“Securities analysts' reports new technology slow adoption, warns study in INFORMS journal (EurekAlert!)” plus 2 more |
- Securities analysts' reports new technology slow adoption, warns study in INFORMS journal (EurekAlert!)
- Securities analysts' reports new technology slow adoption, study warns (PhysOrg)
- Kids outgrow growing pains: study (Reuters via Yahoo! News)
| Posted: 12 Mar 2010 07:27 AM PST ![[ Back to EurekAlert! ]](http://www.eurekalert.org/images/back2e.gif){kind=small} Public release date: 12-Mar-2010[ | E-mail |  Share ] Contact: Barry List Evidence from digital photography and VoIPThe reluctance of securities analysts to recommend investment in veteran companies using new techniques to grapple with radical technological change may be harming these companies as they struggle to compete, according to a new study in the current issue of Organization Science, a journal of the Institute for Operations Research and the Management Sciences (INFORMS). "Securities Analysts and Incumbent Response to Radical Technological Change: Evidence from Digital Photograph and Internet Telephony" is by Mary J. Benner of The Wharton School. The study appears in the current issue of Organization Science http://orgsci.journal.informs.org/. The findings suggest that management teams contemplating bold innovation and the adoption of radical technological change may be held back by conservative investment firms that reward firms that stick to their knitting by extending existing technologies. "This may be short-sighted," says Dr. Benner. "Existing companies may be rewarded in the short run with increased stock prices for focusing on strategies that extend the financial performance from the old technology, but they may pay later in the face of threatening technological substitutes." The study examines already existing ("incumbent") companies that contemplated major technological changes in two industries: photography and telecommunications. In the first, the author studies the period of shift to digital technology away from film. In telephony, she looks at the advent of Voice over Internet Protocol (VoIP). Dr. Benner finds evidence that analysts are more encouraging toward companies' strategies that extend existing technology than toward strategies that respond directly to the new technology. "In these settings," she writes, "analysts largely ignore incumbents' strategies that directly incorporate the new technology for several years." She found that 1. analysts were markedly more attentive to companies' offerings that extended old technologies film in photography and wireline technology in telecommunications than to companies' attempts to develop new products to compete with emerging technologies. 2. at turning points in their recommendations about buying a company's securities, analysts still remained more enthusiastic about products that extended old technologies or created hybrids tied to the old technology. Photography The author studied analysts' reports covering two publicly traded companies, Kodak and Polaroid, during the twelve-year period from 1990 to 2001, when Polaroid declared bankruptcy. She studied analysts at five firms covering the photography industry: Morgan Stanley, Prudential, Smith Barney (later Salomon Smith Barney), Paine Webber, and Credit Suisse First Boston, reading and coding 814 securities analysts' reports comprising 8,166 pages. Both Polaroid and Kodak introduced digital cameras to compete with the emerging market, as well as hybrid products that combined film and digital technology. Analysts preferred the latter. Between 1990 and 1996, for example, analysts mentioned the Kodak hybrid Photo CD 38 times and the company's APS camera system, another hybrid, some 144 times but never mentioned the company's DCS 100, a new digital camera. The analysts were consistently positive to the hybrid products and critical of the digital cameras. During this same period, in contrast, a LexisNexis search shows 493 articles and business stories focusing attention on Kodak's new digital products. When upgrading Kodak ratings to "buy" or "strong buy," the analysts consistently cited the performance of film, not digital. But, Dr. Benner writes, "the securities analysts' optimism toward the incumbents' film-based products was not generally associated with successful outcomes." Only in the final year of study did analysts begin to acknowledge the importance of a technology that had already become established in the public eye. Telecommunications The author studied analysts' reports covering the four "Baby Bells" Verizon, Qwest, SBC Communications, and Bellsouth from 2002, when Vonage debuted, to 2005, when SBC merged with AT&T. She examined Morgan Stanley and Deutsche Bank, including 420 reports with 3,298 pages. In these reports, analysts ignored new VoIP-related devices such as Qwest's OneFlex and SBC's U-verse and Verizon's VoiceWing, despite hundreds of articles in the press. In contrast, the author found nearly 800 analysts' mentions of applications by telecommunications companies for long-distance lines in compliance with Section 271 of the Telecommunications Act of 1996. "Again, as in the photography setting," she writes, "the general lack of reaction from analysts toward the incumbents' strategies to directly respond to VoIP technology is surprising." Speculating on their motives, Dr. Benner suggests that the uncertainty associated with eras of technological ferment leads them to hold onto legacy approaches until companies' profits are directly affected. Or, she writes, the difficulty of establishing the value of new technological strategies may be too difficult within traditional models. Nevertheless, the negative implications for managers are clear. "Managers interested in adaptation and survival of their organizations must take steps to respond to new technology long before uncertainty about technological standards or new profit models is resolved," she writes. "The challenges may be even greater than suggested in prior research, however, as analysts (and the investors they influence) may continue to reward firms for strategies that focus on extending and preserving an old technology." About INFORMS The Institute for Operations Research and the Management Sciences (INFORMS) is an international scientific society with 10,000 members, including Nobel Prize laureates, dedicated to applying scientific methods to help improve decision-making, management, and operations. Members of INFORMS work in business, government, and academia. They are represented in fields as diverse as airlines, health care, law enforcement, the military, financial engineering, and telecommunications. The INFORMS website is www.informs.org. More information about operations research is at www.scienceofbetter.org. [ | E-mail | Share ]
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| Securities analysts' reports new technology slow adoption, study warns (PhysOrg) Posted: 12 Mar 2010 07:52 AM PST "Securities Analysts and Incumbent Response to Radical Technological Change: Evidence from Digital Photograph and Internet Telephony" is by Mary J. Benner of The Wharton School. The study appears in the current issue of Organization Science http://orgsci.journal.informs.org/. The findings suggest that management teams contemplating bold innovation and the adoption of radical technological change may be held back by conservative investment firms that reward firms that stick to their knitting by extending existing technologies. "This may be short-sighted," says Dr. Benner. "Existing companies may be rewarded in the short run with increased stock prices for focusing on strategies that extend the financial performance from the old technology, but they may pay later in the face of threatening technological substitutes." The study examines already existing ("incumbent") companies that contemplated major technological changes in two industries: photography and telecommunications. In the first, the author studies the period of shift to digital technology away from film. In telephony, she looks at the advent of Voice over Internet Protocol (VoIP). Dr. Benner finds evidence that analysts are more encouraging toward companies' strategies that extend existing technology than toward strategies that respond directly to the new technology. "In these settings," she writes, "analysts largely ignore incumbents' strategies that directly incorporate the new technology for several years." She found that — 1. analysts were markedly more attentive to companies' offerings that extended old technologies - film in photography and wireline technology in telecommunications - than to companies' attempts to develop new products to compete with emerging technologies.
2. at turning points in their recommendations about buying a company's securities, analysts still remained more enthusiastic about products that extended old technologies or created hybrids tied to the old technology. Photography The author studied analysts' reports covering two publicly traded companies, Kodak and Polaroid, during the twelve-year period from 1990 to 2001, when Polaroid declared bankruptcy. She studied analysts at five firms covering the photography industry: Morgan Stanley, Prudential, Smith Barney (later Salomon Smith Barney), Paine Webber, and Credit Suisse First Boston, reading and coding 814 securities analysts' reports comprising 8,166 pages. Both Polaroid and Kodak introduced digital cameras to compete with the emerging market, as well as hybrid products that combined film and digital technology. Analysts preferred the latter. Between 1990 and 1996, for example, analysts mentioned the Kodak hybrid Photo CD 38 times and the company's APS camera system, another hybrid, some 144 times but never mentioned the company's DCS 100, a new digital camera. The analysts were consistently positive to the hybrid products and critical of the digital cameras. During this same period, in contrast, a LexisNexis search shows 493 articles and business stories focusing attention on Kodak's new digital products. When upgrading Kodak ratings to "buy" or "strong buy," the analysts consistently cited the performance of film, not digital. But, Dr. Benner writes, "the securities analysts' optimism toward the incumbents' film-based products was not generally associated with successful outcomes." Only in the final year of study did analysts begin to acknowledge the importance of a technology that had already become established in the public eye. Telecommunications The author studied analysts' reports covering the four "Baby Bells" - Verizon, Qwest, SBC Communications, and Bellsouth — from 2002, when Vonage debuted, to 2005, when SBC merged with AT&T. She examined Morgan Stanley and Deutsche Bank, including 420 reports with 3,298 pages. In these reports, analysts ignored new VoIP-related devices such as Qwest's OneFlex and SBC's U-verse and Verizon's VoiceWing, despite hundreds of articles in the press. In contrast, the author found nearly 800 analysts' mentions of applications by telecommunications companies for long-distance lines in compliance with Section 271 of the Telecommunications Act of 1996. "Again, as in the photography setting," she writes, "the general lack of reaction from analysts toward the incumbents' strategies to directly respond to VoIP technology is surprising." Speculating on their motives, Dr. Benner suggests that the uncertainty associated with eras of technological ferment leads them to hold onto legacy approaches until companies' profits are directly affected. Or, she writes, the difficulty of establishing the value of new technological strategies may be too difficult within traditional models. Nevertheless, the negative implications for managers are clear. "Managers interested in adaptation and survival of their organizations must take steps to respond to new technology long before uncertainty about technological standards or new profit models is resolved," she writes. "The challenges may be even greater than suggested in prior research, however, as analysts (and the investors they influence) may continue to reward firms for strategies that focus on extending and preserving an old technology." Five Filters featured article: Chilcot Inquiry. Available tools: PDF Newspaper, Full Text RSS, Term Extraction. |
| Kids outgrow growing pains: study (Reuters via Yahoo! News) Posted: 12 Mar 2010 01:06 PM PST NEW YORK (Reuters Health) – Most youngsters grow out of having otherwise unexplained bone and muscle aches known as growing pains, researchers from Israel report. Of 35 children who originally had growing pains, Dr. Yosef Uziel, at Meir Medical Center in Kfar-Saba, and co-investigators found that 18 -- or 51 percent -- no longer had growing pains 5 years later, when they were about 13 years old. Fourteen of the 17 who still had growing pains after 5 years said their episodes had decreased and become milder, the researchers report in The Journal of Pediatrics. These findings, and the fact that growing pains did not result in school absences or sleep problems, hint at "the benign nature of this common syndrome," Uziel commented in an email to Reuters Health. Nonetheless, in both a previous look at 44 children with growing pains and the current assessment in 35 of these same youngsters, the investigators observed that kids with growing pains seem to be more sensitive to pain than their peers. In their latest study, Uziel's team applied metered pressure to various body points of 20 boys and 15 girls from the original cohort with growing pains. They similarly measured pain sensitivity in 38 age-matched boys and girls who did not have growing pains. They report that 82 percent of the youngsters with continuing growing pains had at least one body point where they detected pain at a level less hurtful than a bump into a piece of furniture or a lightly stubbed toe. They found the same in just 44 percent of the youngsters with resolved growing pains and 58 percent of those who never had growing pains. Uziel recommends that parents explain to anxious children that growing pains are common and usually lessen over time. He notes that relaxation techniques, gentle massage, and over-the-counter pain medications may also help. In his experience, Uziel has not seen any case of growing pains develop into a more serious pain syndrome or arthritis. But truly ruling out such a possibility requires further research in larger groups of children, he noted. Therefore, Uziel suggests parents err on the side of caution by having a physician evaluate any child with severe or very persistent growing pains. SOURCE: The Journal of Pediatrics, published online February 22, 2010 Five Filters featured article: Chilcot Inquiry. Available tools: PDF Newspaper, Full Text RSS, Term Extraction. |
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