Gender diversity and innovative R&D

Gender diversity is relevant when it comes to R&D innovation, according to a study of Spanish manufacturing firms; however much more important is “diverse functional expertise”, say researcher in a paper to be published in the International Journal of Entrepreneurship and Small Business.

Juan Fernández-Sastre of FLACSO Ecuador explains that innovation does not result from rational managerial decisions, rather it emerges from the complex social systems in which individuals share knowledge to generate new ideas. The personnel working in a research and development (R&D) department are perhaps the most relevant to the innovation structure.

Fernández-Sastre has analyzed data extracted from the Spanish Survey of Technological Innovation (PITEC). PITEC is panel data compiled by the Spanish National Statistics Institute (INE), the Science and Technology Foundation (FECYT) and the Foundation for Technical Innovation (COTEC). He has looked at four different types of innovation: product, service, process and organisational. Product innovation involves a company marketing a new or improved product. Service innovation involves the introduction of new or improved services. Process innovation involves novelty and improvements in production, distribution or support activities. Organisational innovation involves changes for the better in management practices.

The analysis reveals that among the Spanish companies studied, the emergence of innovation was specially related to the functional diversity of the R&D workforce and to a lesser extend to its gender diversity, except in the case of service innovation, for which gender diversity was as beneficial as functional diversity, due to the personal interactions and market insights necessary for improvements at the service level.

“Manufacturing firms, for which service innovation is a source of competitive advantage, should be really concerned with human resource management practices for gender diversity and not only with the building of cross-functional teams,” says Fernández-Sastre. Additionally, the data suggests that, “Managers should not consider forming teams with equal proportions of men and women. This may reduce male-female interaction and the benefits associated with the existence of minority groups in the creative and problem-solving process”. Finally, “Those firms aiming at introducing innovations that involve interactions among internal and external agents and those that require a better interface with the market place will benefit more from gender diversity than those firms pursuing innovations related to the solution of technical problems”, Fernández-Sastre concludes.

Fernández-Sastre, J. (2015) ‘The impact of R&D teams’ gender diversity on innovation outputs’, Int. J. Entrepreneurship and Small Business, Vol. 24, No. 1, pp.142–162.

Reputation and online buzz

Reputation is an asset to cherish, whether corporate, institutional or personal. In the age of social media, however, reputation is more fragile than ever. News of a simple mistake or misjudged action can spread rapidly via social networking sites. The ill-judged video, the angry response, the tasteless joke, the inappropriate photograph… In the past, they would reach very few people and would be quickly forgotten in the print era, unless particularly gruesome. Today, Twitter and YouTube and a legion of citizen journalists will prevent the Internet from ever letting you, your friends, family, customers or membership from ever forgetting even the most trivial of faux pas.

Thierry Warin, Associate Professor of International Business at HEC Montréal and Vice-President of Strategy and International Economics at Cirano (Canada) and colleagues Nathalie de Marcellis-Warin, William Sanger, Bertrand Nembot and Venus Hosseinali Mirza of the Polytechnique Montréal, have turned to game theory to help them understand corporate reputation in the age of social media. Their results serve as a warning to corporations to be ready to protect their reputations more vehemently than ever before. They also suggest that it is essential for companies to be aware of the risks associated with social media and social networking in terms of “buzz” and the potential to “go viral” in the context of bad publicity or those aforementioned faux pas.

“More and more companies are exposed to the judgment of social media,” the team reports in the International Journal of Economics and Business Research. “On the one hand, local companies can be criticized by local consumers on media such as Facebook, while on the other hand, global companies can be criticized by consumers anywhere in the world.” At the time of writing, Facebook has a “population” akin to that of China or India, with almost 900 million daily users. Other social sites also have memberships numbering in the hundreds of millions and current estimates suggest that around 40 percent of the world’s population now have Internet access, 20 years ago it was just 1 percent. There is plenty of scope for sharing of both information and disinformation across the globe.

Events with the potential to damage reputation might include news of a genuine problem shared, hoaxes, libel and slander, activist activities and industrial sabotage. Whether or not the event will have a significant impact will ultimately depend on whether or not the wider social media is interested and thus whether the issue is shared widely enough that it reaches critical mass and “goes viral” to the detriment of the company, institution or individual.

Fundamentally, the team’s game theory model of commercial reputation versus social media buzz demonstrates that those corporations that do not set much store by social media and are not concerned with their reputation in this sphere will struggle to contain the “buzz” in the face of an adverse event and so it will take longer for the buzz to die down. Their reputation may never recover in some cases, stock prices can plummet and companies can go out of business. “From a management perspective, this model helps us advocate in favor of a strategy that consists in investing a lot of resources in brand building,” the team says. “Brand building strategies are an efficient investment. It may prevent a buzz in case of an adverse event by convincing social media users that they should play the coordination strategy. But even in the case of a buzz, having a high level of reputation as a result of brand building strategies help reduce the recovery time.”

Warin, T., de Marcellis-Warin, N., Sanger, W., Nembot, B. and Mirza, V.H. (2015) ‘Corporate reputation and social media: a game theory approach’, Int. J. Economics and Business Research, Vol. 9, No. 1, pp.1–22.

Warin, T., de Marcellis-Warin, N., Sanger, W., Nembot, B. and Mirza, V.H. (2015) ‘Corporate reputation and social media: a game theory approach’, Int. J. Economics and Business Research, Vol. er9, No. 1, pp.1–22.

Urban liveability – international cities ranked

An international study has devised a new measure for the “livability” of major cities across the world. The Global Liveable Cities Index (GLCI) takes into account the sensibilities of ordinary working people from 64 cities, balancing work and play, environmental awareness, localism, globalism and many other factors. Details are published in the World Review of Science, Technology and Sustainable Development.

According to Tan Khee Giap of the National University of Singapore and colleagues at University of California, Davis, and Curtin University, in Bentley, Australia, existing major city indices can be divided into two groups. The first includes those that put a higher value on cities based on economic-financial prowess, and strong global agenda-setting power in political and cultural matters. The second ranks cities based on their having a pleasant living environment, a mild climate and a scenic locale. However, such measures ignore the multidimensional nature of what makes a city liveable.

The team suggests that a combination of all those factors and several others should provide a much more balanced perspective on a city’s “value” to its citizens from the economic, aesthetic, environmental and other perspectives. Moreover, the team asserts that, “The implicit ethical values of a balance between work and play, and of a balance between thinking globally and acting locally are values which we are comfortable in advocating to any city, and which we think most people could accept.” The factors they take into account in their measure include (in no particular order of merit): economic vibrancy and competitiveness, domestic security and stability, socio-cultural conditions, public governance, environmental friendliness and sustainability. These factors, each given equal weight, provide a conceptual framework for a concept of liveability in the team’s index.

In the 1950s about one third of the world’s population lived in cities, by the second decade of the new millennium this proportion had risen to about one half and it is projected that by 2050, almost three-quarters of us will live in urban, rather than rural or other, areas. It is important for the comfortable and sustainable development of cities and the quality of life of their citizens that we define and understand what makes a city liveable.

From the economic perspective, liveability is a key characteristic that attracts people with talent and money leading to putatively self-fulfilling economic growth and resilience and power on the global scale. But, city dwellers are not all rich and talented and their growing populations must have available to them opportunity for personal growth and a good quality of life too.

The team describes their index as a work in progress, but posits a liveability list of the 64 cities studied, which includes many of the most populace cities. The ranking of the top ten is as follows: Geneva, Zurich, Singapore, Copenhagen, Helsinki, Luxembourg, Stockholm, Berlin, Hong Kong, Auckland. New York City does not appear until number 17, despite being ranked number 1 by economic indicators and other ranking schemes. Tokyo is number 18. London is number 22. Moscow close to the bottom of the rankings at number 62 and Jakarta bottom of their list at number 64.

However, the team has simulated new rankings based on how environmental, political and economic change to improve liveability might alter the order and shown that Singapore could rise to joint #1 with Geneva while Chicago, Shanghai, Amman and Abu Dhabi could jump from relatively low-ranking positions to much higher up the team’s urban league table. “The rank of a city today is not necessarily a good indicator of its rank in the future,” the team suggests. Environmental restoration and transport infrastructure improvements already underway in many Asian, and specifically Chinese cities, could see the higher liveability today of European cities outstripped as those developing cities develop further.

The team’s ongoing work involves assessing 200 global cities including 100 from Greater China, 30 from South East Asia, 20 from the Middle East and 50 from Europe, Australia, New Zealand, North and South America.

Giap, T.K., Thye, W.W. and Aw, G. (2014) ‘A new approach to measuring the liveability of cities: the Global Liveable Cities Index’, World Review of Science, Technology and Sustainable Development, Vol. 11, No. 2, pp.176–196.