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How much CEOs matter to firm performance:
"Do CEOs matter?" has been a perennial question in management discourse. But "the CEO effect" has been notoriously difficult to isolate -- a moving target caught in the slipstream of dynamic forces that shape firm performance.
So Morten Bennedsen, INSEAD Professor of Economics and the André and Rosalie Hoffmann Chaired Professor of Family Enterprise, along with colleagues Francisco Perez-Gonzalez (ITAM and NBER) and Daniel Wolfenzon (Columbia University and NBER) decided to find out how much CEOs matter by measuring the impact on firm performance when a CEO is absent, specifically, hospitalised.
They find, in a forthcoming paper, "Do CEOs Matter? Evidence from Hospitalization Events", soon to be published in the Journal of Finance, that the financial ramifications of CEO hospitalisation are significant.
Based on data of nearly 13,000 Danish SMEs between 1996 and 2012, Bennedsen and his co-authors find that five-to-seven day hospitalisations sent firm profitability tumbling by 7% in the year of illness. Longer hospital stays of 10 days or more wreaked even deeper damage, lowering operating return on assets (OROA) by a full percentage point.
Journal Reference
Morten Bennedsen, Francisco Pérez-Gonzalez, Daniel Wolfenzon. Do CEOs Matter? Evidence from Hospitalization Events, The Journal of Finance[$] (DOI: 10.1111/jofi.12897)
See also: Phys.org
[Source]: INSEAD research
(Score: 2) by JoeMerchant on Wednesday April 08 2020, @01:34PM (7 children)
Put more simply: the monkeys are organized and all food flows through the kitchen.
The hundred monkeys with control of the kitchen have decided to keep all the grapes for themselves, they only pass out cucumbers to the million monkeys outside.
It's what was wrong with the USSR - we're not at those levels of popular demotivation yet, but we're heading in that direction. Demotivate any farther than the USSR and you need to resort to threat of violence or starvation to motivate the workers. We don't need many workers to feed the people anymore, but handing out cucumber while keeping all the grape doesn't work out in the end - and even if it does, do we as a society want to take 99.9% cucumber?
It has been ~40 years since The Clash wrote this, it's a shame that we have made so much technological progress and so little societal progress since then:
🌻🌻 [google.com]
(Score: 1) by khallow on Wednesday April 08 2020, @07:16PM (6 children)
Yes, it's only the best improvement [soylentnews.org] in the human condition ever. Nothing to see here.
(Score: 2) by JoeMerchant on Wednesday April 08 2020, @11:09PM (5 children)
Evidence gathered and presented by your favorite delusionist - colour me unsurprised.
There is some truth to the fact that the peasantry is only now starting to complain because they are somewhat at liberty as compared with centuries gone by - the old maxim of idle hands being the devil's workshop is quite true, if you represent the establishment. It was the idle rich of the Renaissance who had the means and opportunity to upset that applecart of societal control systems.
It's all rather academic to us, assuming mortality continues to claim us within ~100 years of our birth, and if that ceases to be true in the next 40-50 years, the wheels are going to fly right off the applecart.
🌻🌻 [google.com]
(Score: 1) by khallow on Thursday April 09 2020, @01:38AM (4 children)
Unless, of course, they don't. Reality just isn't following the narrative after all. My take is that if suddenly everyone lives a lot longer, they'll finally get around to looking at and solving the problems that take longer than a present day human lifespan to develop - whatever those end up being.
(Score: 2) by JoeMerchant on Thursday April 09 2020, @03:06AM (3 children)
My take is that if suddenly everyone lives a lot longer instead of adding 75 million per year to the population total, we will shoot straight up to 125 million per year - and if functional reproductive health is also pushed into higher aged people the birth rate will climb even higher.
🌻🌻 [google.com]
(Score: 1) by khallow on Thursday April 09 2020, @03:20AM (2 children)
A problem that can be solved by having a lot less kids. Note that the developed world already has this solved.
(Score: 2) by JoeMerchant on Thursday April 09 2020, @07:16PM (1 child)
I note that the developed world currently is in a population expansion pause - predictions about the future are notoriously inaccurate.
🌻🌻 [google.com]
(Score: 1) by khallow on Thursday April 09 2020, @08:20PM
Arguments from ignorance fallacies typically are too.