Browsing by Author "Mitchell, Will"

This dissertation examines what drives firms' divestiture activity and how it impacts their performance. Divestitures is defined here as the sale, spin-off or liquidation of assets from an ongoing organization. This dissertation seeks to understand what drives firms' reconfiguration activities via divestitures, and in turn how the divestiture activity impacts the future performance in terms of survival and growth. The dissertation identifies differences in the performance of a firm relative to their prior performance as a driver for divestitures, as well as other financial constraints. Moreover, it shows that, counter-intuitively, divestitures are a tool for growth and helps strong firms continue to grow and helps them avoid becoming a target for acquisitions; whereas in the case of weak firms, divesting does not help them avoid shutting down. This dissertation argues that divestitures are tools firms use to reconfigure and reallocate their financial and managerial resources; in the case of weak firms, divestitures are a mode used primarily to free the necessary monetary funds necessary for firms to address problems and regain competitiveness, whereas for strong firms divestitures are a tool to free scarce managerial resources that can be more efficiently allocated in areas that can provide further growth. This dissertation contributes to our understanding of what drives firms divestitures and corporate strategic decisions in general, and provides evidence that even firms coming from positions of strength can eliminate parts of the organization as a way to grow.

This dissertation develops new theory and evidence to show that human-capital based competitive advantage of firms varies with external markets, firm structure, and firm openness to factor markets. The dissertation includes three empirical studies.

The first study examines how labor market frictions due to strict employment protection regulations can be a source of competitive advantage for affiliates of corporate groups over standalone firms in environments where benefits from internal market flexibility are high. Utilizing the variation in labor laws and capital market development across 16 West-European countries, the study finds a stronger competitive advantage for group affiliates in countries with rigid labor markets, but flexible capital markets. In these environments, group affiliates are more prevalent and they outperform standalone firms in terms of growth and profitability.

The second study examines how structural features of a firm and the nature of managerial resources interact to influence top managerial mobility in corporate groups. Using a novel dataset on intragroup managerial mobility, the study documents decreased internal redeployment of managers to affiliates with minority shareholders, especially if those managers are high-performing. These results are driven by hired managers. In contrast, family-related managers, who are related to the controlling shareholders, are more likely to be deployed to partly-owned, strategically peripheral and affiliates operating in regions where societal trust levels are low. These results suggest the importance of trust as a managerial attribute.

The third study examines how disclosure of firm performance affects top manager mobility into and out of firms. Using managerial mobility data for 610,000 managers in over 32,000 corporate groups across Europe, the study shows the key tradeoffs in managerial markets associated with disclosure: disclosing firms lose more managers, especially if firms are performing well. Importantly, those departing managers leave to larger firms and to positions of greater responsibility. However, the results suggest that disclosing firms are better able to acquire new managers from other high-performing firms. Further, survey evidence suggests that disclosing firms can mitigate managerial outflows by implementing better human capital management practices. The study contributes to understanding how firms can capture value from strategic human capital, while protecting and refreshing sources of competitive advantage that are embodied in firm's top management.

Taken together, these three studies contribute to understanding conditions under which firms can capture value from strategic human capital, and the key tradeoffs associated with accumulating and protecting knowledge resources while tapping into external knowledge flows.

Health system strengthening is now recognized as a pressing global health priority. Motivated and productive health workers are a critical component of health systems. Low and middle-income countries need many more health workers, but not simply more of the same. Insufficient collaboration between the health and education sectors creates a crippling mismatch between professional health service education and the realities of health service delivery. A transformative scale-up of health education is needed to increase the capacity of health systems to respond to population needs. We make the case for multi-sector innovation during the scale-up of health education-- ranging from new recruitment strategies, faculty development and curricular reform on the institutional level to cross-sector planning and investment on the national level. Such a transformation will require a broad process of multi-sector reform.

In Uganda the lack of formal health management education is a barrier to improved health systems and improved population health outcomes. Duke University partnered with executive leadership from the Ugandan Catholic and Protestant medical bureaus, the public health sector and the three leading schools of health management in Uganda to conduct a series of activities to strengthen the capacity for health management and leadership in Uganda. After a formative research process to describe the national health management training landscape, the partnership surveyed health managers in the Kabarole District in western Uganda. The partnership then designed and led a five day workshop on leadership, management and governance in the Kabarole District in western Uganda.

A series of pre- and post- surveys asked workshop participants to self-report their confidence, previous use and predicted use of skills in each of the five workshop modules as well as evaluate the course content, design and instruction. These data were analyzed to determine if the workshop showed potential for health system improvement.

All but one module demonstrated significant pre to post confidence effect-size change, as well as significant self-reported intent to practice new management skills. A module-based workshop that (1) is designed with evidence gathered with a country-level and local needs assessment; (2) combines global content with local context; and (3) uses experiential learning techniques, may be an effective intervention for organizational change. Further follow-up after post-workshop mentoring activities will be important to document this process. We describe a vision for how this follow-up might take place within the larger context of the partnership's future activities. We also include a manual based on the workshop instructional materials entitled: A Teaching Manual for Health Facility Management, Leadership and Governance in Uganda.