scholarly journals Capacity constraints as a trigger for high growth

2021 ◽  
Author(s):  
Alex Coad ◽  
Clemens Domnick ◽  
Florian Flachenecker ◽  
Peter Harasztosi ◽  
Mario Lorenzo Janiri ◽  
...  
Keyword(s):  
New Product Development ◽  
Trigger Point ◽  
High Capacity ◽  
High Growth ◽  
Sales Growth ◽  
Capacity Utilisation ◽  
Process Improvements ◽  
The Road ◽  
Transitory State ◽  
Future Growth

Abstract High-growth enterprises (HGEs) have a large economic impact but are notoriously hard to predict. Previous research has linked high-growth episodes to the configuration of lumpy indivisible resources inside firms, such that high capacity utilisation levels might stimulate future growth. We theorize that firms reaching critically high capacity utilisation levels reach a “trigger point” involving either broad-based investment in further growth or shrinking back to previous levels. We analyze EIBIS survey data (matched to ORBIS) which features a question on time-varying capacity utilisation. Overcapacity is a transitory state. Firms enter into overcapacity after a period of the rapid growth of sales and profits, and the years surrounding overcapacity have higher employment growth rates. Firms operating at overcapacity make incremental investments (e.g. capacity expansion, process improvements and modern machinery) rather than investing in R&D and new product development. We find support for the “fork in the road” hypothesis: for some firms, overcapacity is associated with launching into massive investments and subsequent sales growth, while for other firms, overcapacity is negatively related to both investments and sales growth.

scholarly journals An empirical relationship between company growth and the market price of securities listed on the Johannesburg Stock Exchange

1992 ◽  
Vol 23 (3/4) ◽  
pp. 63-68 ◽  
Author(s):  
Narendra Bhana
Keyword(s):  
Stock Exchange ◽  
Empirical Relationship ◽  
Market Price ◽  
Selection Procedure ◽  
High Growth ◽  
Return On Equity ◽  
Johannesburg Stock Exchange ◽  
Investment Returns ◽  
Growth Stocks ◽  
Future Growth

There appears to be a widespread belief among investors that growth companies and growth stocks are identical. The objective in this article is to determine if the shares of high growth companies listed on the Johannesburg Stock Exchange (JSE) provided superior investment returns during the period 1974-88. The empirical evidence revealed that high growth companies underperform because the market overestimates their future growth and future return on equity, as a result their shares tended to have overvalued price-earnings ratios. Therefore, the investor will incur substantial losses if their results are below expectations. It is hypothesized that a cognitive bias may be responsible for the erroneous identification of growth stocks as shares of growth companies. Company results have a tendency to regress to the mean as the underlying economic forces attract new entrants to attractive markets and leave low-growth businesses. Because of this tendency, companies that have provided high growth in the past may prove to be inferior future investments. Past financial attributes cannot be relied upon to predict future returns. The investor should integrate a rigorous valuation model into the share selection procedure so that estimates of future growth and profitability can be used to make an estimate of expected returns.Dit blyk dat daar 'n algemene mening onder beleggers bestaan dat groeiende maatskappye en groeiende effekte een en dieselfde is. Die doel van hierdie ondersoek is om te bepaal of die aandele van maatskappye wat op die Johannesburgse Effektebeurs genoteer word en wat 'n hoe groei toon, hoer opbrengste gelewer het gedurende die tydperk 1974-88. Die empiriese bevindings dui daarop dat hoegroeimaatskappye onderpresteer, omrede beleggers hul toekomstige groei en toekomstige opbrengste oorskat, met die gevolg dat hul aandele oorgewaardeerde prysverdienste-verhoudings toon. As gevolg hiervan strek dit tot nadeel van die belegger as die uitslae nie aan die verwagtings voldoen nie. Die hipotese word gemaak dat 'n bewussynsvooroordeel moontlik daarvoor verantwoordelik is dat groei-aandele foutiewelik as aandele van groeiende maatskappye geindentifiseer word. Maatskappy-uitslae het die neiging om terug te keer tot die gemiddelde, na gelang die onderliggende ekonomiese kragte nuwe deelnemers na aantreklike markte lok, weg van laegroeimarkte. As gevolg van die neiging mag maatskappye wat in die verlede hoe groei getoon het, swak toekomstige beleggings wees. Daar kan dus nie op voormalige finansiele kenmerke vertrou word om toekomstige opbrengste te voorspel nie. Die belegger behoort 'n streng skattingsmodel in sy keuse van effekte te integreer sodat skattings van toekomstige groei en winsgewendheid gebruik kan word om 'n skatting van verwagte opbrengste te maak.

scholarly journals Firm Growth and R&D in the Korean Pharmaceutical Industry

2019 ◽  
Vol 11 (10) ◽  
pp. 2865 ◽  
Author(s):  
Hyunseog Chung ◽  
Soomin Eum ◽  
Chulung Lee
Keyword(s):  
Growth Rate ◽  
Pharmaceutical Industry ◽  
Firm Growth ◽  
Negative Relationship ◽  
High Growth ◽  
Sales Growth ◽  
Young Firms ◽  
The Government ◽  
The Impact ◽  
Positive Effect

We explore the impact of research and development (R&D) on sales growth rate with firm-specific factors under the Korean pharmaceutical industry structure using listed Korea pharmaceutical company data from 2007 to 2018 with the quantile regression technique. We find that R&D intensity has a positive effect on firm growth rate while R&D scale a negative effect on the firm growth rate at the upper quantile, whereas the result is opposite at the lower quantile. Firm size has a mixed relationship with sales growth at the upper quantile, thus Gibrat’s law is rejected in the Korean pharmaceutical industry. Firm age has a negative relationship with the sales growth rate at the upper quantile, which shows the consistent result with previous research that young firms grow faster. Patent persistence has a negative relationship with sales growth at the upper quantile, while a positive effect at the lower quantile. We show that young firms and firms with high R&D intensity contribute to the high growth rate, while the relationship is not clear at the lower quantile. Therefore, policy implication in this research is that the government should pay attention to encouraging and supporting R&D investment activities and small firms as well as consider ways to enhance patent rights.

scholarly journals A influência das condições operacionais na pontualidade do transporte marítimo

2020 ◽  
Author(s):  
◽  
S. D. G. Müller
Keyword(s):  
Discrete Event ◽  
Operating Cost ◽  
High Capacity ◽  
Road Transport ◽  
Outcome Data ◽  
Liner Shipping ◽  
Operational Conditions ◽  
The Road ◽  
Efficient Alternative ◽  
Low Efficiency

Among the available cargo transport modes, Liner Shipping can be highlighted due to its importance to the globalization process and the exponential growth witnessed along the last decades, as effect of the attractive attributes of reliability, predictability, high capacity and low overall cost. Although punctuality is also considered as default in Liner Shipping, past data points to a different reality, especially on developing countries, a subject approached in several research in the area. In Brazil, Cabotage plays a significant role to the national logistics landscape, by adding a viable and efficient alternative to the road transport, the country’s main transport mode. However, due to poor port infrastructure and low efficiency from the major terminals, there are high operating cost and low schedule reliability. To evaluate how Brazilian port’s operational conditions affect strategic and tactical planning of a Cabotage Liner Shipping service, a discrete-event simulation model has been developed, aiming at the cabotage service of a large Brazilian shipping company over a year and the outcome data of the simulation were crosschecked against the company’s preestablished deterministic proforma. The results show several reliability issues, forcing the company to take speed variation countermeasures, which might not be the most financially attractive scenario. Another insight regards to under- or overstated variables in some port calls, leading to bad service quality as well as unnecessarily increasing the system costs. Ultimately, some necessary proforma changes have been identified, in order to enhance its reliability

IMPROVING THE ORGANIZATION OF PASSENGER SERVICE ON THE ROUTE BY USING BUSES OF DIFFERENT CAPACITY

2019 ◽  
Vol 16 (3) ◽  
pp. 264-275 ◽  
Author(s):  
I. M. Ryabovbov ◽  
R. Ya. Kashmanov
Keyword(s):  
Road Network ◽  
High Capacity ◽  
Rolling Stock ◽  
Volga River ◽  
The Road ◽  
Passenger Traffic ◽  
Transport Services ◽  
Rational Distribution ◽  
On The Road ◽  
The City

Introduction. The authors propose to use a rational distribution of buses, taking into account their passenger capacity and the hours of the day, in order to optimize the operation of the rolling stock (RS) on the route. The usage of RS low-capacity on routes with significant passenger traffic increases the RS need, the load on the transport network and emissions of harmful substances into the atmosphere. Operation of high-capacity buses on routes with low power passenger traffic leads to the large intervals of movement and to the increase of waiting time for passengers. The authors highlight that on the number and type of buses’ determining it is necessary to take into account the city specifics (on the example of Volgograd), such as the presence of only two main streets with three lanes in each direction, adjacent roads through which the routes pass, one lane direction.The length of the city along the Volga river in total is about 90 km, due to the peculiarities of the road network (RN) of the city, any irrational use of the RS leads to a significant load on the road network, and, as a result, to the congestion on the roads. Nowadays the PS is not operated effectively.On most routes of the city the capacity of RS does not correspond to passenger traffic on the route. Possible way to optimize the use of RS is taking into account the daily load on the road network.Materials and methods. The authors studied the technology of the movement organization of the rolling stock on the № 59 route. In order to optimize the transportation process, the authors used the method of determining the buses’ number by hour of the day on the base of the graph-analytical method. Buses of different capacity were used on this route.Results. The resulting distribution of buses made it possible to combine the interests of carriers and passengers, to increase the efficiency of rolling stock and to reduce the load on the road network.Discussion and conclusions. As a result, the authors present the measures for improving the efficiency of the rolling stock. These measures are the main for improving transport services for population.

Engineer-To-Order Product Development

2016 ◽  
pp. 43-59
Author(s):  
Richard Addo-Tenkorang ◽  
Petri Helo ◽  
Jussi Kantola
Keyword(s):  
Product Development ◽  
Competitive Advantage ◽  
New Product Development ◽  
Information Exchange ◽  
Lead Times ◽  
Sustainable Competitive Advantage ◽  
Systems Architecture ◽  
Complex Product ◽  
Process Improvements ◽  
Engineer To Order

Industrial manufacturers' complex product-development activities have seen various advancement and improvement approaches over the past decades. In order to enable the implementation of efficient and effective product-development support processes in the quest of achieving shorter product development lead-times and higher return on investments (ROIs). Engineer-To-Order (ETO) product capacity projects, including large electric machine, huge centrifugal pumps, Diesel/Natural fuel power plant engines, steam turbine, boiler, ship, etc., have challenges concerning their long product-development lead-times. The challenges confronting these enterprises industrial Original Equipment Manufacturers (OEMs) are enormous with one of the major ones being the effective and efficient network or flow of technical communication among the main stakeholders for complex / new product-development. Moreover, with all the industrial manufacturing complex product-development process improvements, in terms of complex engineering design and delivery, there are still a lot more variances to be addressed on the ‘better, faster and cheaper' paradigm. Furthermore, attention is needed on efficient information exchange systems as well as effective operational communication in their complex product-development processes for a sustainable competitive advantage. Therefore, this paper presents a proposed optimum conceptual information technology systems' architecture towards enhancing an industrial sustainable competitive advantage: By employing social network theory (SNT) analysis to advise on a strategic and effective communication network for industrial supply-chain (SC) sustainable competitive advantage.

System Reform, Competition, and Innovation in China

2021 ◽  
pp. 204-240
Author(s):  
Weiying Zhang
Keyword(s):  
Regional Analysis ◽  
Allocative Efficiency ◽  
High Growth ◽  
System Reform ◽  
State Sector ◽  
The Past ◽  
Chinese Entrepreneurs ◽  
The Government ◽  
Innovative Economy ◽  
Future Growth

China’s economic reform and openness have promoted innovation through intensifying competition. A cross-regional analysis shows that innovations in terms of research and development intensity, patents, and sales of new products are all positively and significantly correlated with the degree of marketization, share of private ownership, and foreign investments. However, China is far away from an innovative economy. The high growth of the past four decades is mainly a result of improvement in allocative efficiency driven by entrepreneurial arbitrage. As the potential of pure allocative efficiency is exhausting, future growth will be more and more dependent on entrepreneurial innovation. For Chinese entrepreneurs to be really innovative and for China to be a real innovative country, abolishing the dominance of the state sector and putting the government under law are urgently called for.

scholarly journals Achieving Sustainable New Product Development by Implementing Big Data-Embedded New Product Development Process

2020 ◽  
Vol 12 (11) ◽  
pp. 4681
Author(s):  
Yufan Wang ◽  
Haili Zhang
Keyword(s):  
Big Data ◽  
Product Development ◽  
New Product Development ◽  
New Product ◽  
Innovation Performance ◽  
Sales Growth ◽  
Gross Margin ◽  
Product Testing ◽  
Sustainable Innovation ◽  
Second Year

Literature suggests that new product development (NPD) has an impact on sustainable organizational performance. Yet, previous studies in NPD have mainly been based on “experience-driven”, not data-driven, decision-making in the NPD process. We develop a research model to examine how the big data-embedded NPD process affects the sustainable innovation performance of NPD projects. We test the proposed model and conduct the cross-national comparison using data collected on 1858 NPD projects in the United States of America (USA), the United Kingdom (UK), and Australia. The research findings suggest that big data-embedded business analysis, product design, and product testing increase sustainable innovation performance in all three countries. The study findings also reveal several surprising results: (1) in the USA, big data-embedded product testing has the highest effect on sales growth and gross margin, (2) in Australia, big data-embedded commercialization has the highest effect on sales growth and gross margin, and (3) in the UK, big data-embedded commercialization has the highest effect on second-year sales growth, first-year, and third-year gross margin; in addition, big data-embedded product testing has the highest effect on third-year sales growth and second-year gross margin.

scholarly journals Determinants of dividend policy in GCC firms: an application of partial least square method

2016 ◽  
Vol 13 (3) ◽  
pp. 455-466 ◽  
Author(s):  
B Rajesh Kumar ◽  
K S Sujit
Keyword(s):  
High Growth ◽  
Least Square Method ◽  
Cash Flows ◽  
Payout Policy ◽  
Partial Least Square ◽  
Least Square ◽  
Growth Opportunities ◽  
Dividend Payout ◽  
Partial Least Square Method ◽  
Future Growth

This study focuses on providing empirical evidence on explanation of alternate dividend theories and determinants of payout policies by examining the GCC market. The study explores the financial determinants of the dividend payout policies by examining 646 dividend intensive firms of the GCC. The results suggest that large firms in GCC tends to have larger retained cash flows and tend to have higher dividend intensity. It can be implied that GCC based firms adopt a balanced and cautious approach regarding future growth opportunities as well as the dividend payout policy. Higher the liquidity and profitability signals higher dividend intensity. GCC firms which are liquid and profitable tend to pay more dividends. GCC firms with higher market valuation tend to pay more dividends. Firms with high growth rates of earnings and assets tend to pay less dividends. Firms with high leverage are riskier and risky firms tend to pay less dividends.

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