Pete Kyle Joins Smith School One of the foremost financial theorists in the world, Albert “Pete” Kyle, will join the Smith School as the Charles E. Smith Chair in Finance in July 2006. He is best known for creating the “Kyle Model,” which provides a foundation for the modern theory of market microstructure, a subfield of finance dealing with the process of price formation in financial markets.

Netcentricity Conference

Edwin A. Locke, professor emeritus of management and organization, has won the James McKeen Cattell Fellow Award from the American Psychological Society. He received the award at APS 18th Annual Convention, May 25-28, 2006. Locke is the most published organizational psychologist in the history of the field. His pioneering research focused on work motivation and job satisfaction, and he is well-known for his publications on goal-setting theory.

Research By Christopher Bingham WHEN IT COMES TO DEVELOPING STRATEGIC ORGANIZATIONAL PROCESSES, EXPERIENCE MAY NOT BE THE BEST TEACHER. THOUGH MUCH RESEARCH IN THE FIELD FOCUSES ON THE WAY FIRMS LEARN THROUGH EXPERIENCE, RECENT RESEARCH BY CHRISTOPHER BINGHAM, ASSISTANT PROFESSOR OF MANAGEMENT AND ORGANIZATION, SUGGESTS THAT THIS VIEW MAY NOT ADEQUATELY DESCRIBE WHAT AND HOW FIRMS LEARN FROM HETEROGENEOUS EXPERIENCES SUCH AS ACQUISITIONS, PRODUCT DEVELOPMENT, PARTNERING, AND INTERNATIONALIZATION.

Research By Soeren Hvidkjaer THE PHENOMENON OF MOMENTUM—THAT STOCKS WHICH INCREASE IN PRICE ONE YEAR WILL TEND TO CONTINUE TO INCREASE IN PRICE OVER THE NEXT YEAR, AND THAT STOCKS WHICH DECREASE IN PRICE ONE YEAR WILL CONTINUE TO DECREASE IN PRICE OVER THE NEXT YEAR—HAS INTRIGUED RESEARCHERS FOR A LONG TIME. WHAT DRIVES THIS ANOMALY? IF MOMENTUM IS DRIVEN BY A PARTICULAR KIND OF INVESTOR BEHAVIOR, THEN THAT BEHAVIOR SHOULD BE DETECTABLE IN THE TRADING RECORDS, REASONED SOEREN HVIDKJAER, ASSISTANT PROFESSOR OF FINANCE AT THE SMITH SCHOOL.

Research by Sunil Mithas MOST BUSINESS MANAGERS UNDERSTAND INTUITIVELY THAT SATISFIED CUSTOMERS ARE THE KEY TO A BUSINESS’ LONG TERM SUCCESS. CHANGES IN A COMPANY’S CUSTOMER SATISFACTION SHOULD BE A LEADING INDICATOR OF CHANGES IN THEIR EXPECTED EARNINGS, AND CHANGES IN EXPECTED EARNINGS ARE IMMEDIATELY REFLECTED IN STOCK PRICES. SO IF THE STOCK MARKET WAS EFFICIENT, NEWS ABOUT AN IMPROVEMENT IN A COMPANY’S CUSTOMER SATISFACTION SCORES SHOULD IMMEDIATELY MAKE THAT COMPANY’S STOCK MORE ATTRACTIVE AND INCREASE ITS PRICE.

Increased Customer Satisfaction Increases Stock Price Most business managers understand intuitively that satisfied customers are the key to a business’ long term success. Changes in a company’s customer satisfaction should be a leading indicator of changes in their expected earnings, and changes in expected earnings are immediately reflected in stock prices.