Knowledge at Wharton

Popular social network sites including MySpace and Facebook are changing the human fabric of the Internet and have the potential to pay off big for investors but -- given their youthful user base -- they are unusually vulnerable to the next new fad. As quickly as users flock to one trendy Internet site they can just as quickly move on to another with no advance warning according to Wharton faculty...

NutriSystem -- the Horsham Pa.-based online weight-loss company -- has bulked up. Its first-quarter 2006 revenues grew 292% to $146.8 million and net income rose 592% with analysts predicting continued sharp increases in 2006. Memories of its bankruptcy filing and litigation woes under previous owners have all but been erased even as the company plans to target new customer segments and expand int...

When Lawton Robert Burns Wharton professor of health care systems began teaching healthcare management he found a hole in the academic literature. There was plenty of material on physicians hospitals government regulations and insurance. But there was no single source of good information on a key component of the industry -- the producers of healthcare products. Burns aims to fill that gap with hi...

When companies talk about marketing these days they are talking about things like promotional strategy advertising and distribution; customer perception; market share; competitors’ power; margins and pricing; products and portfolios; customer profitability; and sales forces and channels. How does a company measure the effectiveness of the various components of its marketing strategy? What metrics...

Disney the media giant announced earlier this month that the company would provide several major shows -- Desperate Housewives Lost Commander-in-Chief and Alias -- as free streaming video through the ABC network’s website. Also this month the Wall Street Journal reported that the Fox network has signed agreements with 187 of its affiliated stations to share revenues from reruns of its programs on...

Interest rates are rising around the world. Last Thursday April 13 the yield on 10-year U.S. Treasury notes closed at 5.05%. This was the first time in four years that the yield exceeded 5%. Moreover short-term interest rates in the U.S. are also going up: The federal funds rate (or the interest rate at which banks provide overnight loans to one another) has risen to 4.75% from some 1% a few years...

Foreign stocks are soaring and Americans are pouring money into them. But although overseas equities have captured investors’ fancy before there’s a twist this time: More investors are embracing passive index-style investing ignoring the long-held belief that active managers can beat indexers by uncovering bargains in inefficient foreign markets. Have conditions really changed enough to make index...

When James C. Collins and Jerry I. Porras wrote their hugely popular 1994 book Built to Last: Successful Habits of Visionary Companies they began by stating clearly that they did not mean to write about visionary leaders. Their goal was to find visionary companies -- the crown jewels of their industries -- and discover what made them extraordinary. Then questions arose about the extent to which th...

In the second of a two-part interview Azim Premji who owns more than 80% of Bangalore-based Wipro India’s third largest software exporter discusses why that country’s IT companies have done a better job at delivering services than developing products. Speaking with Wharton professor Ravi Aron he points out that customers are beginning to unbundle prices with the result that established IT and cons...

The phrase ”free shipping” is like a siren song to many who shop on the Internet. For whatever reason a free shipping offer that saves a customer $6.99 is more appealing to many than a discount that cuts the purchase price by $10 says Wharton marketing professor David Bell. Bell noticed this phenomenon a few years ago while doing research for an online grocery store and the observation prompted hi...

Consumers’ love affair with expensive customized cups of coffee shows no signs of abating even though most orders consist of little more than a cup of water a splash of milk a spoonful of coffee grinds and 30 seconds of labor. Indeed Starbucks has managed to turn its customers’ craving for caffeine into a $6.4 billion a year business with close to 6 000 company-owned coffeehouses already up and ru...

Corporate leaders must build international organizations to compete in today’s economy and be prepared to defend globalization at home according to Klaus Kleinfeld chief executive of the German electrical and engineering conglomerate Siemens AG. Speaking at a recent Wharton Leadership Lecture Kleinfeld said U.S. concerns about the sale of port assets to a Dubai-based firm and French resistance to...

When General Motors last month offered buyouts and early retirement packages to 113 000 hourly workers the move focused new attention on a key aspect of the continually evolving relationship between employers and employees. Buyouts often signal management’s decision to strategically change the company’s direction and start easing out those workers who are part of what is now considered the old reg...

Roy Vagelos a highly regarded pharmaceutical executive who spent two decades at Merck including 10 years as CEO has often said that ”research remains my life blood ” and indeed he has stayed active in the industry since his retirement from Merck in 1994. For example he is chairman of the board of two small drug companies Regeneron Pharmaceuticals and Theravance and in 2004 co-authored a book entit...

Kevin Werbach a professor of legal studies and business ethics at Wharton spoke recently with David Yaun an IBM executive about the company’s Global Innovation Outlook project. According to Yaun ”traditionally companies have identified innovation with gadgets and gizmos but that thinking is being transformed.” The definition of innovation is being broadened -- it is becoming more open collaborativ...

Everyone uses commodities such as wheat cocoa crude oil butter coal and electricity. But most investors know that speculating on commodities in the futures markets is only for the pros and no sensible amateur would bet his retirement or college funds on sugar silver orange juice or feeder cattle. But are commodities really that risky? Using the most comprehensive data on commodities futures return...

A talking chimp arriving in e-mail inboxes speaks in its sender’s voice through a telephone connection or recites a pre-recorded joke for the boss. Burger King’s ad campaign offers a ”subservient chicken” site where viewers can type in commands to a person in a chicken suit with red garters. JibJab is developing a new site called JokeBox where consumers and corporations can post and share funny vi...

Azim Premji 60 owns more than 80% of Bangalore-based Wipro India’s third largest software exporter which had annual revenues of $1.8 billion in 2005. Forbes magazine reckons that his net worth exceeds $13 billion and it places him at No. 25 in its most recent ranking of the world’s richest people. In the first of a two-part interview with Knowledge at Wharton Premji speaks with Ravi Aron a profess...

In the debate over how to build better models to help the world’s neediest citizens supporters of for-profit social-impact organizations argue that their model is more sustainable than non-profit schemes. Non-profit and foundation executives agree that new paradigms are necessary but caution that for-profit models could ultimately put profit ahead of serving the poor. The issues surrounding this d...

When Google announced its Gmail email service two years ago a lot of people figured the company was joking. After all Google had been known to offer up the occasional gag like saying it was starting a research center on the moon. More importantly nobody believed that consumers would tolerate Google’s plan of scanning people’s emails and then delivering advertisements to them based on the emails’ c...

It’s open season on the television industry’s business model. In recent years the three pillars of the industry’s profits -- advertising regional programming and syndication deals -- have come under fire from a band of technology companies including Sling Media TiVo Orb Networks and Apple Computer that are rewriting the content distribution rules. As one Wharton professor notes TV won’t necessaril...

Helen Greiner shares a key trait with many successful business leaders -- a passion for something. In her case it happens to be robots. That passion led Greiner -- along with Colin Angle and Rodney Brooks -- to found what would become iRobot in 1990. Over the past four years iRobot has sold more than 1.5 million robots for cleaning floors and has deployed more than 300 tactical military robots in...

At a time when global business rivalries are intensifying competition often resembles combat. Keeping this connection between business and the armed forces in mind three Wharton undergraduate students -- Rana Yared Naomi Adaniya and Mark Green -- recently participated in officer leadership training at the U.S. Naval Academy. Among the lessons they learned: Leadership isn’t always glamorous; it oft...

Online communities have become not just a major social force but a significant driver of business activity both online and offline. Facilitating nurturing and benefiting from those communities however is not a simple task. To explore what makes these communities tick Kevin Werbach a professor of legal studies and business ethics at Wharton spoke with Craig Newmark founder of Craigslist.com Julie H...

Much to the surprise of several venture capitalists who turned her down Helen Greiner co-founder of iRobot has built a thriving business making domestic robots like Roomba which sweeps floors and industrial robots that defuse bombs in Iraq. She was on campus this week at the invitation of the Wharton technology and entrepreneurship clubs and spoke with Knowledge at Wharton about the impact that ro...