Timothy Simcoe’s research covers topics in innovation, technology, intellectual property, and corporate strategy. He has consulted for major corporations in the information technology sector. During 2014 and 2015, Professor Simcoe served as a senior economist on President Obama’s Council of Economic Advisers. He is a faculty research fellow at the National Bureau of Economic Research, and an editor at several journals, including Management Science.
|The U.S. Federal Trade Commission’s proposed ban on noncompete agreements will impact innovation and entrepreneurship outside of existing technology hubs. Strongly agree||“There is very strong evidence that ending noncompetes will be good for innovation generally. While benefits may be concentrated in existing technology and innovation hubs, the benefits can still be broad-based (and are likely to be larger outside of California, where noncompetes have long been tough to enforce).”|
|The diametric experiences of Disney and UEFA illustrate that firms should refrain from making political statements in support of particular stakeholders. Strongly disagree||“The experiences of Disney and UEFA illustrate that firms may be forced into taking a public stance on issues that are culturally or politically divisive. The lesson is not to avoid things that might be unavoidable but to think ahead and develop a clear set of values to guide managers’ actions and statements in those circumstances.”|
|BP’s decision to dial back plans for cutting oil and gas production shows that short-term financial performance pressure will make it difficult for many firms to transition their strategies toward more sustainable business models. Disagree||“I think BP’s change does illustrate that oil and gas producers will be slow to transition toward greener strategies. But firms in other sectors do not necessarily have the same stranded-asset problem (or similar cultural issues) and will face increasing pressure from shareholders and customers to make meaningful changes.”|
|Digital platform companies like Uber and Netflix have lost their first-mover advantage. Neither agree nor disagree||
“Yes: Both of these companies face competition from similar services, their users increasingly multi-home, and complementors constantly seek a larger share of total surplus.
No: These early movers built a huge installed base, brand recognition, and some relatively sophisticated technology that will be hard for entrants to imitate.”
|The use of generative AI will restore competition in search. Strongly agree||“Investments in generative AI are an example of technological competition in search. It’s too early to say exactly how those investments will play out or whether Google’s large share of overall search will decline. But there is no question that many different companies are currently working to apply new AI technologies to help users find what they want on the internet.”|
|New salary transparency laws will cause companies to increase bonus pay and other nonreportable perks as a share of total compensation. Agree||“At the margin, there will almost certainly be some substitution in this direction. I do not have strong views about how much.”|
|Artificial intelligence is reducing wasteful holiday giving (i.e., deadweight loss) by helping online retailers to better match people to presents. Strongly agree||“I do think that recommendation engines are helping to improve gift giving at the margins. So yes! But there is an older technology called the “Christmas list” that already works pretty well — except for a few unnamed relatives, who are giving me socks no matter what Amazon tells them.”|
|Charging for user verification will lead to increased user engagement and trust on Twitter. Strongly disagree||“In theory ... maybe. On the actual Twitter platform, where users are actively trying to circumvent (and parody) rules that change from one moment to the next ... I don't think so.”|
|Corporate investments in diversity, equity, and inclusion should be expected to generate a monetary return on investment. Disagree||“This question asks whether firms should accept that some investments in DEI may have a negative financial ROI, and I think the answer is yes. All firms face constraints — such as laws — that must be satisfied before they can worry about earning a profit. In that context, one could argue that addressing historical and socioeconomic injustice is part of the cost of every firm’s social license to operate. Of course, DEI initiatives are not always a burden, and when they are, firms need not share those costs equally. But smart managers will recognize that investments in social justice typically serve shareholders’ long-term interests, even if the immediate financial ROI is negative.”|
|The era of dominance for Tesla in the EV market is coming to an end. Agree||“Competition comes for us all. I can’t “strongly agree” only because I am no car industry expert, but all signs point toward increased choice and competition in EVs.”|
|Online education and specialized degrees will supplant the traditional two-year full-time MBA. Agree||“This is definitely true at the margin, but I don’t think online and micro MBAs will “supplant” the traditional MBA in the near future. The online experience is undoubtedly improving. Students who are more sensitive to price and opportunity costs, or who are looking to upskill without switching employers, will find these new formats and options attractive. That will put pressure on B-schools that use in-person, part-time, and evening programs to make up for the lack of scale in the two-year MBA, and it may lead to more concentration in the full-time segment. But there is still plenty of demand for well-rounded managers who can understand an entire business, and if that is what you aspire to, the in-person approach still delivers a lot of value, both inside and outside the classroom.”|
|Starbucks’s plans to increase wages for nonunionized workers is a shortsighted strategy. Neither agree nor disagree||“I don’t know whether or not this is a good strategy. But I don’t think you can call it shortsighted, since they must have some expectations about how this move changes the behavior of workers who would otherwise unionize.”|
|Sanctions against Russia will cause multinational companies to consider human rights protections in supply chains more broadly. Disagree||“A host of recent events (not just the war in Ukraine) should cause firms to reevaluate risks associated with international supply chains. While many health, climate, political, and technological risks are linked to human rights, firms are more likely to respond to these other factors, rather than address human rights issues directly.”|
|Blockchain is more likely to be a sustaining innovation than a disruptive innovation in the financial sector. Agree||“While blockchain already appears “disruptive” in the colloquial sense of changing how things are done, I don’t see any reason to think it is “disruptive” in the strategic management sense of undermining the sources of competitive advantage enjoyed by large, established financial institutions.”|
|The field of strategic management has overlooked the role of corporate purpose in driving business performance. Strongly agree||“The normative debate about business purpose has been with us for a very long time, even if Milton Friedman’s famous answer (“to increase profits”) seemed to settle the matter for much of the 80s through the aughts. Perhaps because that view became so entrenched, management scholars have not produced much credible knowledge about how firms define purpose-beyond-profit, or whether it matters for performance (measured as either profit or some broader set of goals). Scholars like Claudine Gartenberg are starting to fill the gap, and that is exciting. But for this research to make a real impact, it will be important not to overemphasize “doing well by doing good” cases that skirt hard trade-offs, and to develop new and better ways of measuring social impact.”|
|Socially responsible mutual funds are more of a marketing tool than a solution to environmental and social problems. Agree||“Measuring social costs and benefits is very hard. CSR-oriented investment funds rely on third-party metrics that purport to measure corporate environmental and social responsibility, but the evidence that those indices are valid is very weak. So, I agree with the statement, though I also believe that many managers and investors want to do (and not just look) good and that the popularity of these funds sends an important signal about investors’ objectives and beliefs.”|
|When hackers take data hostage, companies should pay the ransom. Disagree||“Perhaps this is arguing the premise, but I think strategy offers two basic lessons on this topic: (1) Plan ahead so you have a backup. (2) A public commitment NOT to pay is one good way to deter hackers before they strike.”|
|Relaxing the rules around physical presence in the office will improve employee productivity and firm performance. Neither agree nor disagree||“Flexibility may raise the productivity of experienced employees. But it will take longer for new hires to acclimate, and creativity will suffer from fewer serendipitous interactions.”|
|The COVID-19 pandemic has permanently changed how companies should think about business strategy. Strongly disagree||
“The answer to this question turns on how one thinks about resiliency and risk management.
Many firms found that their supply chains were not as resilient as they assumed (similar to banks that discovered latent risks in the financial crisis). This will probably lead to greater emphasis on risk management and a reevaluation of some types of operational decisions.
But the pandemic did not alter any of the fundamental lessons about value creation and value capture that form the core of business strategy.”
|The COVID-19 pandemic will lead companies to relocate infrastructure and employees away from dense urban locations. Disagree||“It could happen a bit at the margins, but I don’t think COVID-19 is going to completely reshuffle the geographic deck. There is a lot of sunk investment in large cities and plenty of evidence that economies of density are substantial. The stronger imperative is to build redundancies into international supply chains.”|