Carolyn Geason-Beissel/MIT SMR | Getty Images The transition to an economy with radically lower greenhouse gas (GHG) emissions is not a matter of if but of when and how. Discussions with executive teams about how they are navigating sustainability issues, however, too often remain framed around the question of “Should my business become more sustainable ..read more

Ken Orvidas/theispot.com More than ever, companies need supply chains that are resilient to disruptions, whether the cause is a natural disaster, an infrastructure failure, labor actions, or a global pandemic. Yet the conventional approach to resilience is seriously flawed. Many companies follow a boom-and-bust pattern, making big investments in resilience after a supply chain disruption ..read more

Carolyn Geason-Beissel/MIT SMR | Getty Images Companies are under increasing pressure to improve supply chain transparency, particularly around working conditions in remote factories. Government regulations, the best practices of peers, and attention from outside stakeholders all make it increasingly critical that leaders ensure that partners producing goods for the company operate fair, safe, and equitable workplaces. A key tactic in fostering such supply chain transparency is to implement on-the-ground, in-person reviews of factories and other workplaces. These social compliance audits are ..read more

Carolyn Geason-Beissel/MIT SMR | Getty Images We like customers and have spent most of our careers studying them. In our research, teaching, and consulting projects, we have repeatedly urged executives to listen to their customers.1 However, we have come to realize an uncomfortable truth: Some customers are just not good for you and will ruin your business. Hence, you would be better off “firing” them. Firing any customer goes against much of the prevailing wisdom in marketing and business. According to legendary business guru Peter Drucker, the purpose of any business is to create and keep a ..read more

For the second year in a row, MIT Sloan Management Review and Boston Consulting Group have assembled an international panel of AI experts to help us understand how responsible artificial intelligence (RAI) is being implemented across organizations worldwide. For our final question in this year’s research cycle, we asked our academic and practitioner panelists to respond to this provocation: As the business community becomes more aware of AI’s risks, companies are making adequate investments in RAI. While their reasons vary, most panelists recognize that RAI investments are falling short of wha ..read more

Annalisa Grassano Touted as one remedy to the gender wage gap, pay transparency laws are increasingly being rolled out across the United States at the state and local levels. Nine states — including New York, as of September — are currently regulating some aspect of pay disclosure. The National Women’s Law Center reports that altogether, more than one-quarter of U.S. employees live in a location where pay information is regulated. By and large, pay transparency regulations have emphasized disclosing a salary range for advertised positions and internal opportunities for advancement. These laws ..read more

Neil Webb/theispot.com The Research The authors conducted research into the state of counterfeiting from 2017 through early 2020. Funding was provided by CAPS Research, a joint venture of Arizona State University and the Institute for Supply Management. During the discovery phase, they ran an in-person workshop and attended the October 2017 annual strategic summit of the Center for Anti-Counterfeiting and Product Protection of Michigan State University. The authors conducted individual interviews with more than 20 subject-matter experts in 2017 and 2018. The authors also conducted in-depth s ..read more

Carlo Giambarresi/theispot.com Are stock buybacks as bad as they’re made out to be? The ubiquitous corporate practice of repurchasing shares has been the focus of much political and media scrutiny. The federal Inflation Reduction Act of 2022 included a 1% excise tax on repurchases (which President Biden has proposed increasing to 4% in his 2024 budget). In addition, senior Democrats have shown interest in barring executives from selling shares for three years after a repurchase, the federal government has suggested that companies that give up buybacks will receive preferential treatment, and ..read more

Predictive Models Can Lose the Plot. Here’s How to Keep Them on Track. Vern L. Glaser, Omid Omidvar, and Mehdi Safavi Key Insight: When algorithms aren’t updated to account for changes in the environment, they deliver poor-quality predictions. Top Takeaways: AI models designed to dynamically account for new circumstances don’t always do so effectively. This scenario, called algorithmic inertia, can result in poor guidance and flawed decisions. The authors explored the causes and consequences of algorithmic inertia by investigating credit-ratings agency Moody’s and its use of algorithmic model ..read more

Simon Prades The Research The authors undertook a holistic study of enterprise resilience that began with the extraction of corporate risk factors from two decades of 10-Ks filed by S&P 500 companies, investment analyst reports, and academic databases. They organized the risks into a value-centric framework composed of eight functions and 99 major risk categories; they then cross-linked the categories and functions with input from risk experts and leaders in 10 economic sectors and 26 industries to create a quantitative risk network. They also analyzed cybersecurity risk acknowledgment i ..read more