Publications

November – December 2011
Article

Most Likely to Succeed: Leadership in the Industry

By: Robert C. Pozen and Theresa Hamacher

What is the critical factor for success in the U.S. mutual fund industry? Is it top-ranked investment performance, innovative products, or pervasive distribution? In our view, it is none of these factors, despite their obvious importance. Instead, the best predictors... View Details

Keywords: Leadership; Success; Investment Funds; Rank and Position; Performance; Investment; Innovation and Invention; Product; Distribution; Forecasting and Prediction; Asset Management; Governance Controls; United States

January 2011 (Revised January 2015)
Case

Matrix Capital Management (A)

By: Malcolm P. Baker and David Lane

Ben Balbale, a partner at hedge fund Matrix Capital, must decide whether to exit their investment in Rovi Corporation, a company with a diverse portfolio of patents used primarily for digital interactive guides. Rovi's shares are up over 50% from the time Balbale... View Details

Keywords: Forecasting and Prediction; Asset Management; Cash Flow; Stock Shares; Financial Markets; Investment Funds; Measurement and Metrics; Mathematical Methods; Strategy; Valuation; Financial Services Industry

Educators

January 2010 (Revised March 2013)
Case

HubSpot: Lower Churn through Greater CHI

By: F. Asis Martinez Jerez, Thomas Steenburgh, Jill Avery and Lisa Brem

HubSpot, a web marketing startup is under pressure from VCs to rapidly acquire new customers and to maintain a low level of customer churn. In the case, students explore the drivers of customer churn and uncover opportunities to increase customer retention across the... View Details

Keywords: Business Startups; Customer Relationship Management; Customer Satisfaction; Customer Value and Value Chain; Forecasting and Prediction; Consumer Behavior; Happiness; Consulting Industry

Educators

February 2001 (Revised June 2001)
Case

ClubTools, Inc.

By: Paul W. Marshall and Kristin Perry

Discusses the development of an Internet start-up by a recent HBS graduate. Details the company's business plan, incubation, technology development, marketing strategy, and search for funding. View Details

Keywords: Business Startups; Business Plan; Cash Flow; Marketing Strategy; Financing and Loans; Technological Innovation; Internet and the Web; Forecasting and Prediction

20 Feb 2007
First Look

First Look: February 20, 2007

(forthcoming) Abstract Abarbanell and Lehavy (2006) examine the effect of distributional properties of earnings and forecast data used by researchers who investigate 'Street' earnings. They perform a large number of analyses, and... View Details

Keywords: Martha Lagace

April 2012
Article

The Predictive Value of Accruals and Consequences for Market Anomalies

By: Francois Brochet, Seunghan Nam and Joshua Ronen

We revisit the role of the cash and accrual components of accounting earnings in predicting future cash flows using out-of-sample predictions and market value of equity as a proxy for all future cash flows. We find that, on average, accruals improve upon current cash... View Details

Keywords: Forecasting and Prediction; Investment Return; Value; Equity; Markets; Cash Flow; Information Management; Accrual Accounting; Earnings Management; Corporate Governance; Stocks

December 1991 (Revised February 1992)
Case

Dayton Electric Corp.

By: Steven C. Wheelwright

Concerns a product redesign decision for one of the company's most successful motor products, its rectified power, medium D-C motor, the RPM. A one-year redesign program has proposed a design that comes close to meeting its stated cost and performance goals, but at the... View Details

Keywords: Product Design; Strategic Planning; Research and Development; Business Divisions; Decisions; Forecasting and Prediction; Product Development; Technological Innovation; Machinery and Machining; Manufacturing Industry; Ohio

29 Jun 2007
First Look

First Look: June 29, 2007

inefficient information processing in equity markets by documenting that biases in analysts' earnings forecasts are reflected in stock prices. In particular, investors fail to account for analysts' tendency to withhold negative views and... View Details

Keywords: Martha Lagace

16 Aug 2010
Lessons from the Classroom

HBS Introduces Marketing Analysis Tools for Managers

Analysis": Managers frequently need to estimate the size of their markets, both for existing products, so that sales forecasts can be developed, and for new products, so that market opportunities can be assessed. This tookit enables... View Details

Keywords: by Sarah Jane Gilbert

April 2002
Teaching Note

Anagene, Inc. TN

By: Robert S. Kaplan

Teaching Note for (9-102-030). View Details

Keywords: Entrepreneurship; Public Ownership; Sales; Production; Forecasting and Prediction; Volume; Governing and Advisory Boards; Cost Accounting; Business or Company Management; Financial Reporting; Strategy; Performance Capacity; Biotechnology Industry

05 Nov 2012
Research & Ideas

What Wall Street Doesn’t Understand About International Trade

'non-strategic traders,' " Cohen says. Historically, Wall Street has failed to consider the local ethnic population trading strategy when assessing the value of a firm. In fact, the researchers found that analysts are significantly less accurate in their earnings View Details

Keywords: by Carmen Nobel

September 2004
Article

Trust in Agency

By: Ramon Casadesus-Masanell

Existing models of the principal-agent relationship assume the agent works only under extrinsic incentives. However, many observed agency contracts take the form of a fixed payment. For such contracts to succeed, the principal must trust the agent to work in the... View Details

Keywords: Trust; Agency Theory; Relationships; Behavior; Motivation and Incentives; Contracts; Business Model; Emotions; Forecasting and Prediction; Ethics; Standards; Risk and Uncertainty

January 2011 (Revised September 2011)
Case

Caterpillar, Inc. (A)

By: David F. Hawkins

2010 Healthcare Reform Act eliminates Medicare Part D subsidy and Caterpillar recognizes a $100 million change. View Details

Keywords: Information Infrastructure; Governing Rules, Regulations, and Reforms; Employment; Cost vs Benefits; Forecasting and Prediction; Change Management; Asset Management; Financial Strategy; Activity Based Costing and Management; Business or Company Management; Technology Industry; Manufacturing Industry; United States

Educators

August 2013
Article

The Price of Diversifiable Risk in Venture Capital and Private Equity

By: Michael Ewens, Charles Jones and Matthew Rhodes-Kropf

This paper explores the private equity and venture capital (VC) markets and extends the standard principal-agent problem between the investors and venture capitalist to show how it alters the interaction between the venture capitalist and the entrepreneur. Since the... View Details

Keywords: Price; Risk and Uncertainty; Venture Capital; Private Equity; Contracts; Investment; Competition; Agency Theory; Investment Return; Forecasting and Prediction; Theory; Diversification

Read Now

05 Feb 2013
First Look

First Look: Feb. 5

earns an average risk-adjusted return of 4.68% per year. Firms with central boards also experience higher future growth in return-on-assets (ROA) with analysts failing to fully reflect this information in their earnings forecasts. Return prediction, growth in ROA, and... View Details

Keywords: Sean Silverthorne

Article

Values, Purpose, Meaning, and Expectations: Why Culture and Context Matter

By: Rosabeth M. Kanter

The "rational person" standard, based on assumptions of economic self-interest, has long prevailed in legal reasoning. But understanding of decision making, behavioral choices, and possibilities for action must be enlarged to include a variety of factors that give... View Details

Keywords: Standards; Interests; Decision Making; Behavior; Value; Groups and Teams; Performance Expectations; Organizational Culture; Leadership; Business Cycles; Forecasting and Prediction; Motivation and Incentives

November 2008
Journal Article

Can Research Committees Add Value for Investors? An Analysis of Lehman Brothers' Ten Uncommon Values® Recommendations

By: Boris Groysberg, Paul M. Healy and Yang Gui

Since 1949 Lehman Brothers has used an investment committee to select the top ten recommendations made by its analysts each year. We examine the performance of this committee's recommendations and find that on average its selections generated abnormal returns of 2.7%... View Details

Keywords: Forecasting and Prediction; Stocks; Financial Markets; Investment; Investment Return; Governing Rules, Regulations, and Reforms; Performance Expectations; Groups and Teams; Research; Value Creation