This month’s research by INSEAD faculty includes strategies to implement better customer experience management and an analysis of the takeover market’s evolution. Other papers investigate the conditions under which human-AI ensembles can support managerial decision-making; how individuals reconcile identity conflicts in an entrepreneurial context; and the potential impact of class action lawsuits in the United States on financial markets abroad.1. Optimising customer experience managementLiterature on the B2B (business-to-business) customer experience tends to promote a one-size-fits-all approach. This advocates the undifferentiated goal of offering customers exceptional customer experience, with the overarching view that “more is better”.In contrast, Wolfgang Ulaga and his co-authors* contend that there’s a better way: Firms may adopt different strategic approaches to customer experience management (CXM), depending on their customers’ goals and related value propositions. The authors identify three universal customer goal categories and their associated CXM value propositions, as well as introduce four archetypical CXM strategies that differ in both impact and scope: CXM Champion, Cherry Picker, Minimalist and Fashionista.Read the paper*Jochen Wirtz, National University of Singapore; Christian Kowalkowski and Tanvir Ahmed, Linköping University; Elina Jaakkola, University of Turku; and Maria Holmlund, Hanken School of Economics.2. When can human-AI ensembles work?An “ensemble” approach to decision-making involves aggregating the results from different decision makers solving the same problem (i.e. a division of labour without specialisation). Drawing on prior research on machine-learning-based AI and human decision-making, Phanish Puranam and his co-authors* examine the conditions under which human-AI ensembles can be useful.They argue that human and AI-based algorithmic decision-making can be ensembled in the context of managerial decisions – even when neither has a clear advantage over the other in terms of predictive accuracy, and even if neither alone can attain satisfactory accuracy in absolute terms. Read the paper*Vivek Choudhary, Nanyang Technological University; Arianna Marchetti, London Business School; and Yash Raj Shrestha, University of Lausanne.3. Reconciling identity conflicts in an entrepreneurial contextWinnie Jiang, Shelly Qi and their co-author, Amy Zhao-Dingof the Technical University of Munich, investigated how individuals achieve or reject an aspired identity when they perceive it as conflicting with existing identities. In their study, 61 socially disadvantaged women in China were provided with an entrepreneurial opportunity. This activated these women’s aspired identity of being business owners, as well as their existing identities of being from a humble background. The women perceived these identities as being in conflict, which generated internal obstacles to the attainment of their aspired identity. The study uncovers the emotional and cognitive dynamics that lead individuals to either be emancipated from or remain entrenched in internal obstacles stemming from a perceived conflict between their aspired and existing identities, which can hinder positive self-transformation.Read the paper4. Can private enforcement discipline foreign firms?The global financial landscape has seen a growing interest in how legal systems, particularly in the US, can influence financial markets beyond their own borders. While it’s well known that legal institutions within a country play a crucial role in protecting shareholders and ensuring market efficiency, there’s been less clarity on whether these effects can extend internationally. Research by Massimo Massa and his co-authors* delves into the potential global reach of US class action lawsuits and their impact on the efficiency of financial markets in other countries. The results show that US class action lawsuits against US-listed foreign firms caused a negative spillover effect on the valuation of similar firms in other countries. This suggests that the influence of US legal institutions can indeed reach beyond national borders.Read the paper*Xiaoqiao Wang and Bohui Zhang, The Chinese University of Hong Kong, Shenzhen, and Hong Zhang, Singapore Management University.5. The evolution of the takeover market Despite largely constant average acquirer returns over the past 40 years, the takeover market has undergone fundamental changes, according to Olivier Dessaint and his co-authors*. Controlling for bidder composition, they found that the general success of acquisitions has increased by as much as five percentage points relative to the 1980s.This increase is broad-based: it is equally present in deals involving public and private targets, cash and stock deals, diversifying and focused acquisitions, and domestic and cross-border agreements. However, the specific benefits each individual buyer obtains from a deal have decreased. The researchers propose a theory of bidder-specific synergies – the unique value a specific acquirer can create – to help interpret these opposing trends.Read the paper*Bjorn Espen Eckbo, Dartmouth College, and Andrey Golubov, University of Toronto.
