Research Roundup: July 2024

Dive into our monthly Research Roundup, showcasing the latest insights from the business education community to keep you informed of new and noteworthy industry trends. Here are this month’s selections:

The Human Touch in AI Development

The Researchers: Cristina Simon, professor of people management at IE Business School, IE University; Elena Revilla, department chair of operations and technology at IE Business School; Maria Jesus Saenz, director of research in digital supply chain transformation at MIT Center for Transportation and Logistics, Massachusetts Institute of Technology

The Output: “Integrating AI in Organizations for Value Creation Through Human-AI Teaming: A Dynamic-Capabilities Approach,” Journal of Business Research, 2024

The Question: How can managers leverage human expertise, transparency, and continuous learning to optimize AI integration and decision-making?

The Findings:

• Domain experts and AI developers discovered that successful collaboration occurred through managing the data requirements for machine learning (ML). When the developers explained the data needed to meet these requirements, the domain experts realized their available data were insufficient for the ML to translate the experts’ knowledge into valid results.
• The technical assistance (TA) team that tested the AI application for hiring was initially skeptical of its capabilities. To build trust and refine the AI's decision-making process, the TA team maintained transparency in their interactions with the AI. For instance, by monitoring how the AI reorganized interview schedules when candidates received similar matching scores, the TA team was able to enhance trust and improve decision-making.
• The study team of developers, experts, and TAs organized follow-up meetings to share their experiences in training and using the algorithm. These discussions highlighted the algorithm’s benefits in challenging their beliefs and converting their implicit expertise into explicit knowledge. These valuable conversations led to changes in their routines, such as adding a test to balance biases and improve hiring processes.

The Implications:

• Managers should invest time in understanding human-AI teaming and establishing the necessary organizational resources and requirements before developing AI-based applications.
• Since AI development benefits from professional wisdom for continuous improvement, managers should create a transparent environment where team members can share experiences and build trust in AI. For example, a finance company developing an AI investment platform should involve financial analysts, data scientists, etc., to ensure alignment with regulations and expert knowledge.
• Mutual learning between AI developers and domain experts should refine biases, enhance decision-making, and improve process and resource optimization within the department.

Learn More

How Psychological Distance Shapes New Product Success

The Researchers: Juyon Lee, visiting research scholar of marketing at the Institute of Management Research, Seoul National University; Wujin Chu, professor of management at SNU Business School, Seoul National University; Rajat Roy, associate professor of marketing at Bond Business School, Bond University

The Output: “Enhancing Consumer Evaluation of New Products: The Role of Innovation Newness and Communication Strategy,” Journal of Business Research, 2024

The Question: How can marketers tailor their messages to better promote new or existing products by considering psychological distance, comprehension, and product type?

The Findings:

• Incremental new products (INPs) enhance existing offerings (e.g., LED lightbulbs versus traditional bulbs), while radical new products (RNPs) introduce novel items (e.g., 3D printers for home use).
• The novelty of RNPs causes consumers to perceive them as more psychologically distant –unfamiliar or less relevant to consumers’ lives compared to INPs.
• Product evaluations improve when INPs highlight attributes (e.g., upgrades or new options) and RNPs emphasize benefits (e.g., groundbreaking technology advancements).
• Consumers equally comprehend the benefit and attribute appeals for both incremental and radical new products that are utilitarian, or practical and functional items. However, consumers respond better to benefit appeals for hedonic products, which are designed for pleasure and enjoyment.

The Implications:

• When promoting utilitarian RNPs, marketers should emphasize the benefits by showcasing how the product can significantly enhance consumers' lives. For instance, a company promotes a smart home energy system that reduces electricity bills and improves home comfort, highlighting savings and environmental benefits.
•  To effectively promote utilitarian INP’s, marketers should highlight attribute appeals, focusing on specific features and functionalities. For example, marketers could highlight an electric toothbrush with advanced features like multiple brushing modes, detailing how those elements improve oral hygiene.
• To promote RNPs, marketers should encourage consumers to visualize positive outcomes and benefits, fostering a mindset that focuses on the reasons behind their purchase decisions. This "why-thinking" increases confidence in their choices.

Learn More

From Click to Cart: Impulse Buying on Social Platforms

The Researchers: Hamed Azad Moghddam, lecturer in consumer behavior at Newcastle Business School, University of Newcastle; Jamie Carlson, professor of marketing at Newcastle Business School; Jessica Wyllie, senior lecturer in marketing at Newcastle Business School; Syed Mahmudur Rahman, faculty member in marketing at Macquarie Business School, Macquarie University

The Output: “Scroll, Stop, Shop: Decoding Impulsive Buying in Social Commerce,” Journal of Business Research, 2024

The Question: How do social commerce features influence consumer motivations and impulse buying, considering the roles of brand identification and social risk?

The Findings:

• Technological advancements significantly enhance impulse-buying opportunities, making it easier for consumers to make spontaneous purchases. During livestream shopping events, for example, consumers can instantly purchase items in real time, taking advantage of the sense of urgency presented by a live event.
• Impulse buying is situational, driven by excitement and immediate gratification, while compulsive shopping is a repetitive behavior that can lead to negative consequences.
• Consumer motivation for social commerce, which involves buying products directly through social media platforms, includes brand intimacy, entertainment, platform benefits, and escapism, collectively driving the urge to impulse-buy (UIB). For instance, the convenience of Instagram's “Shop Now” feature allows users to purchase products directly within the app without navigating to an external website.
• Consumer-brand identification (CBI) helps counteract consumers’ perceived social risk when commenting on social platforms—such as lack of approval by peers—thus maintaining customer motivation to impulse-buy.

The Implications:

• Social commerce managers should allocate marketing resources to create personalized content and strategies to address customer needs and promote CBI/UIB.
• Clearly communicating value propositions through social media and offline channels is essential to addressing consumer priorities. Marketers can use targeted ads to highlight unique product features and customer testimonials to build trust and credibility.
• Social commerce practitioners should design customer experiences and content marketing to fulfill consumer desires and motives. They might design immersive virtual shopping environments with entertainment, escapism, and practical tools, for example.

Learn More

Birth Country Bias in Global Acquisitions

The Researchers: Antonio Marra, associate professor of accounting and finance at Bocconi University; Angela Pettinicchio, affiliate professor in accounting at the SDA Bocconi School of Management Bocconi, Bocconi University; Ron Shalev, associate professor of accounting at the University of Toronto Scarborough

The Output: “Home Sweet Home: CEOs Acquiring Firms in Their Birth Countries,” Journal of Accounting Research, 2024

The Question: How do foreign-born CEOs influence the location of their organization's acquisition targets and their approach to cross-border deals?

The Findings:

• Empire-building motives are more common in local acquisitions than in global ones for both domestic and foreign-born CEOs, as they aim to expand quickly and manage larger companies.
• Cross-border acquisitions in a CEO’s birth country have higher completion rates than those by domestic-born CEOs or foreign-born CEOs targeting other countries.
• CEOs are more likely to acquire distressed firms when the target is in their birth country. For example, a CEO from India is more likely to acquire a struggling Indian firm due to local knowledge and a desire to support their home economy.

The Implications:

• Foreign-born CEOs prefer less complex, quicker-to-integrate acquisitions to facilitate rapid expansion and manage larger companies. For example, a CEO acquiring a local competitor with similar business practices and regulatory environments allows for smoother integration and faster growth.
• The larger target premium for distressed firms indicates that CEOs desire to support their birth countries, leading to higher offers for struggling companies.
• These motives impact wealth distribution between acquirers’ and targets’ shareholders and affect the overall quality of acquisitions. For instance, a CEO acquiring a distressed firm in their birth country benefits the target’s shareholders significantly but may lead to challenges in achieving long-term value.

Learn More

Unlocking Employee Voice in Dynamic Workplaces

The Researchers: Xiaotong Zheng, associate professor in leadership and organizational behavior at Durham University Business School; Michele Williams, research fellow in entrepreneurship at the Tippie College of Business, University of Iowa; Xiaoyu Wang, associate professor of organizational management at Schools of Economics and Management, Tongji University; Jian Liang, vice dean at the Advanced Institute of Business, Tongji University

The Output: “It’s More About ‘We’ Than ‘I’: The Employee-Supervisor Fit in Achievement Striving, Organizational Identification and Employee Voice,” BlueSky Education, 2024

The Question: How does the alignment of supervisors’ and employees’ achievement striving—their desire to accomplish goals to a high standard—impact employee voice through organizational identification?

The Findings:

• Employees are more likely to voice concerns when their achievement goals align with their supervisors’, leading to a more open and communicative work environment.
• Alignment with a supervisor's goals was more important for employees to express their thoughts than having a high motivation for achievement. When there was a mismatch in motivation for achievement between employees and supervisors, employees were less likely to speak up.
• Goal alignment enhances organizational identification, which is a key motivator for constructive feedback, fostering a sense of belonging and commitment to the company’s success.

The Implications:

• Alignment between supervisors’ and employees’ achievement goals boosts employee voice, leading to better communication and more proactive problem-solving.
• While many employees are focused on career growth, some prioritize only pay and minimum job requirements. Promoting high achievers to growth roles and aligning them with similarly minded managers, and matching minimal-effort employees with like-minded supervisors, can enhance talent management and address employee well-being.
• Organizations should set clear and challenging goals while providing incentives to motivate and inspire creativity in their employees. This approach helps align goals and enhances employee voice.

Learn More

Send press releases, links to studies, PDFs, or other information regarding new and forthcoming research, grants, initiatives, and projects relevant to business education to AACSB Insights at [email protected].