Author: Jill Young Miller


About Jill Young Miller

As research translator for WashU Olin Business School, my job is to highlight professors’ research by “translating” their work into stories. Before coming to Olin, I was a communications specialist at WashU’s Brown School. My background is mostly in newspapers including as a journalist for Missouri Lawyers Media, the Atlanta Journal-Constitution, The Washington Post and the Sun-Sentinel in South Florida. Also, I am the reigning Olin Cornhole Champion.

The coronavirus pandemic has shattered and shuttered businesses. Here, three Olin experts offer insights into potential opportunities as businesses struggle to emerge from the economic storm.

“The biggest question businesses are learning to ask themselves is, ‘Are we essential?’” said Doug Villhard, professor of practice in entrepreneurship and academic director for entrepreneurship. “If that answer was recently proven to be ‘no,’ then now is the time to form strategies to make your organization ‘essential’ in the future.”

How will businesses change because of the pandemic?

Minyuan Zhao

Minyuan Zhao, associate professor of strategy: “Businesses may have to rethink their value propositions. Before the pandemic, a nail salon was there just because women were ‘supposed’ to have their nails done, a florist was in business because flowers were ‘supposed’ to be at various events, and retailers invested in second-day delivery because consumers were ‘supposed’ to like fast delivery. The crisis will change all this. Collectively, we will redefine what is truly essential to our lives, and what we can do without.”

Peter Boumgarden
Peter Boumgarden

Peter Boumgarden, professor of practice in strategy and organization: “It’s important for businesses to think hard about the ways in which their short-term demand is impacted both by general consumer confidence, which is likely to be down in the short-run, and the social proximity people need to receive your products or services, which is potentially impacted due to changing social norms around public gathering.

“Think of a concert venue or a restaurant. They might want to creatively plan for some kind of viable model of reduced operations.”

What opportunities could exist as we emerge from the crisis?

Doug Villhard

Villhard: “Look for ways to solve the biggest problems you and your customers are now facing. It will be one of two things: supply or demand. Work quickly to become essential in one of these areas.”

Boumgarden: “Organizations should think hard about how to develop the flexibility to ramp up or down operations more quickly and seamlessly if a second wave of the virus forces a similar social distancing. Think of a hospital system that is opening up for elective services but also wants to be ready to move back to a COVID-19 response set-up. I can see new opportunities for those who can help organizations do this transition planning more effectively.”

Zhao: “The most obvious opportunity is the online businesses: virtual meetings, virtual classes, virtual concerts, virtual tourism, etc. But I think the opposite is also true: street corner coffee shops where you can say hi to the neighbors and connect with the offline world. 

“The new business models also create demand for robust infrastructure, especially the digital infrastructure in data storage, transfer and security.”

What can businesses do to position themselves for opportunity?

Zhao: “It’s probably too early to make costly strategic moves, but businesses can start to reassess their business models and all the assumptions that support their business models. It’s shocking how many assumptions are now in question.”

Villhard: “Re-read your website and marketing materials.  You’ll immediately be able to tell if those concepts are suddenly ‘dated’ in light of the crisis. Revise them to speak to the new challenges your customers now face. The world changed overnight. Your organization needs to adapt as well, and you need to show you are a thought-leader in the new world.”

Boumgarden: “I would encourage business leaders to find ways to run mini-experiments during this time. Use these as an opportunity to tease out creative hypotheses with your customers that you might not have done previously. If you can do this in inexpensive ways now, this is a great opportunity to learn.”

Villhard: “In entrepreneurship we teach to ‘start with empathy.’ Put yourself in the mindset of the problems your customers are now facing. If you do so, an unprecedented number of new ideas will immediately emerge for you.”

Do some businesses currently have an advantage over others?

Villhard: “If your solutions are both domestic and/or virtual/digital you are extremely well-suited. And if they are not, work quickly to get them there.”

Boumgarden: “I see leaders having to wrestle with new types of problems. Imagine trying to figure out the Paycheck Protection Program as you consider whether or not your loan will be forgiven. Or trying to predict the likelihood of viral reoccurrence and its impact on your supply chain. Many organizations do not have this expertise internally and have to look outside for support. Organizations and individuals with strong social networks can tap into new forms of expertise outside their own walls.”

Anything you recommend for business owners/managers to read?

Villhard: “Refresh on the classic book Innovators Dilemma. If you are an established company, you are about to be attacked by dozens of startups. And many of them will now be run by recently laid-off workers who have been sitting on an innovative idea in your industry for years and now find themselves in a perfect opportunity to strike against the establishment.”

Boumgarden: “I’m really enjoying a new rhythm of a weekly reading of The Economist. This is for two reasons. First, I find that a daily newspaper (like the New York Times or Wall Street Journal) makes me too attuned to the ups and downs of the news. A weekly is more emotionally digestible. Second, I find that in offering stories from around the globe, The Economist expands my understanding of the interconnectedness of our global economy.”

Zhao: “I’ve found it very helpful to look back into history and reflect on the big picture—how we came to where we are. More to that point, I find it helpful to write in addition to read. Write about how we see the world, and sometimes you’ll be surprised by what’s on your mind.”

She recommends the following: The Deluge: The Great War, America and the Remaking of the Global Order, 1916-1931, by Adam Tooze; The Last Kingdom, by Bernard Cornwell; The Great Influenza: The Epic Story of the Deadliest Plague in History, by John M. Barry; and The Silk Roads: A New History of the World, by Peter Frankopan.

Hong Kong protest 2019

Critics claim the 2019 protests in Hong Kong undermine it as a leading global financial center.

Olin’s David R. Meyer, however, finds that Hong Kong’s status is secure for three reasons:

  • China’s government will continue to support it;
  • Hong Kong’s financial networks possess extraordinary scale and sophistication;
  • and no viable alternative center has emerged to challenge Hong Kong as the Asia-Pacific leader.
David R. Meyer

Meyer, a senior lecturer in management and expert on East Asian and international business, puts forth his arguments in “The Hong Kong protests will not undermine it as a leading global financial centre,” published online in April in Area Development and Policy.

“The Hong Kong protests will not undermine it as a leading global financial center,” he said, citing his research that draws on the “geography of finance” research on global financial centers.

Protests begin

The protests started in mid-March 2019 after the government sought to allow extradition of suspects between Hong Kong, Mainland China, Taiwan and Macau in criminal cases. Then, on June 9, came the march of “more than a million Hongkongers,” according to organizers.

As Meyer notes in the paper, protesters issued five demands: withdraw the extradition bill; make an independent inquiry into police enforcement; retract the “riot” classification of violent protests; drop charges against demonstrators; and reform elections.

Protests and riots continued into the fall. By November, demonstrations reached the airport and temporarily closed it, protesters took over university campuses and disrupted the rapid transit system. Later that month, voters swept anti-government candidates into office in district elections. Then, as violent protests declined, peaceful protests continued this year.

Network hub of global capital’

Now critics claim the protests threaten Hong Kong as a leading global financial center. They suggest Hong Kong’s importance to China will fade because activities such as initial public offerings, bond sales and currency trading will be done elsewhere, Meyer says in his paper.

Hong Kong
Hong Kong

They speculate that other cities—among them Singapore, Beijing, Shanghai and Shenzhen—will compete with Hong Kong and that financiers will move their business to other cities.

“These are serious claims,” Meyer said.

Yet the claim that the protests threaten Hong Kong as a leading center “fails to recognize that the city’s significance rests on its status as a network hub of global capital,” Meyer said.

“Based on this perspective,” Meyer writes in the paper, “I argue that the protests do not threaten Hong Kong as a global financial center because its networks of capital are resilient.”

No other financial center in the Asia-Pacific region has the ability to replace it, he says.

Almost two centuries of stability

Research on global financial centers shows a high degree of stability at the upper-ranked centers dating back for almost two centuries, Meyer notes in the paper.

London had replaced Amsterdam as the leading center by the 19th century, and New York joined the top centers in the early 20th century. Hong Kong became the leading financial center in Asia by the late 19th century, according to the paper.

This relative stability of the upper-level financial centers persists, Meyer says. Even the 2008 global financial crisis couldn’t significantly disrupt the ranks of the top financial centers.

(Meyer says the COVID-19 crisis “will have no consequence other than near-term disruption of activity as is occurring in all major financial centers.”)

And even though China’s leaders are unhappy with the Hong Kong government and outraged over the violent protests, no evidence suggests that they will undermine the city’s financial community, according to the paper.

“Hong Kong’s financial community occupies the highest level of specializations in finance and contains multi-faceted, complex and internally connected networks,” Meyer writes.

“Components of these networks reach across Asia and globally, which means Hong Kong is the pivot of financial expertise and knowledge in the region.”

In business, simple loyalty programs can strongly increase customer retention, Olin researchers have found. And when the US economy edges closer to normal following the global pandemic, such programs may be a method to help businesses get back on their feet.

The researchers studied a loyalty program at a chain of men’s hair salons, collecting data on more than 5,500 customers. Under the program, for every $100 a customer spends, he gets a $5-off coupon.

“This loyalty program did increase loyalty,” said Raphael Thomadsen, Olin professor of marketing. “In fact, the size of the effect is incredibly large given the simplicity of the program.”


The program increased the lifetime value of the hair salons’ customers by 29%, with more than 80% of that lift coming from increased customer retention, the researchers found.

The increased lift happened despite the fact that coupon redemption was low, suggesting that psychological factors rather than rational economic factors are driving the results.

Emotionally connected

“For example, the presence of the rewards program can make the customer feel emotionally connected to a particular firm, which leads to the customer visiting the firm more often,” the authors write in “Can Non-tiered Customer Loyalty Programs Be Profitable? The paper is under minor revision at Marketing Science.


Coauthors of the paper include Olin’s Yulia Nevskaya, assistant professor of marketing, Arun Gopalakrishnan, of Rice University, and Zhenling Jiang, of Georgia State University. Both Gopalakrishnan and Jiang have Olin ties. Gopalakrishnan was an Olin assistant professor of marketing from 2015 to 2019. And, last year, Jiang received her PhD in marketing from Olin.

The researchers did not study the response to loyalty programs during the current economic crisis. But Thomadsen and Nevskaya agreed such programs could help businesses recover.

“It is often easier for companies to get in touch with their loyalty program members than with other clients,” Nevskya said. “That is another benefit of having a loyalty program. The right tone and message and being sensitive to likely shifting needs of consumers during and after the COVID-19 epidemic should definitely help.”

‘Even a simple program is likely to work well’

Loyalty programs are popular at many businesses. Some programs, such as those for airlines and hotel chains, are complex and include multiple tiers, and they’ve proven to be quite successful. But a vast number of loyalty programs are set up in much simpler ways, with no tiers.

Over time, managers and academics have questioned the efficacy of simple loyalty programs, finding they have little or no benefit, according to the paper. But previous studies contained a significant flaw, the authors say. Those measured the programs’ effectiveness by increased sales per customer visit or by increased visits. The flaw? They didn’t measure the programs’ impact on keeping customers.

The managerial implications of the findings are clear, Thomadsen said. Many businesses are not going to implement complex loyalty programs, either because of the scale of their businesses—think yogurt shops, pizza parlors, coffee houses—or because they philosophically oppose setting up a tiered system.

“Our research suggests that even a simple program is likely to work well,” he said. “Even if another business only gets half of the lift we get, a simple loyalty program will still add considerable value.”

Because of the worldwide havoc of the coronavirus, supply chains have become a crucial new focus of the global economy. Sergio Chayet, director of the Operations and Supply Chain Management MBA platform at Olin, foresees changes ahead in several areas including making workers safer and strategies to guard against future massive stresses on supply chains.

“There is a new appreciation for retail store employees, factory workers and workers in logistics and transportation, energy, health care, education, and other industries responsible for sustaining life during shutdowns,” he told Bloomberg recently. (See “How supply chains jumped from business school and into our lives.”)

“Just like September 11 brought permanent changes to airport and port security, it is likely this latest crisis will bring permanent changes to operations and supply chain risk management as it pertains to mitigating worker health risks and establishing contingency plans to protect them.”

Would it be better for companies to produce from geographically diverse places or from one particular region?

“Having a geographically diverse footprint and carrying excess capacity is always valuable as a real option, since it allows firms to react to a wide variety of risks (social, political, macroeconomic, etc.) by shifting production to the most convenient location on short notice  with changes to the global economy.

“But such excess capacity is costly and must be justified by being exceeded with the real option’s value. A complementary strategy, when feasible, is having flexible contracts with supply chain partners. However, when several correlated risks happen in quick succession, partners will be unable to honor those flexible terms.”

What lessons are we now learning about supply chains?

“Over the last couple decades, driven by price and time competition, supply chains have evolved toward becoming leaner and more responsive, resulting in lower production and transportation costs. Reduced trade friction and international arbitrage opportunities in the form of wages, total cost, exchange rate, access to talent and raw materials, and other differences, has led to ever more global supply chains. Containerization, larger vessels and ports, and warehousing innovations have all contributed to lowering logistics and transportation costs.

“As a result, consumers have had access to unprecedented levels of product variety at low prices.

“But lean supply chains are more susceptible to disruption risk, and have to rely on excess capacity or being nimble in integrating new partners into them.

“When the crisis started, all eyes were on China, and organizations were evaluating contingency plans to mitigate risks affecting that portion of their supply chains. In the midst of companies evaluating those contingency and reactive measures, the crisis started to become more severe in Europe and subsequently in America, rendering many of those options obsolete.”

What’s an example of a situation that may not have been considered in the past?

“The demand shocks many retailers have experienced for commodity products. Some understandable, such as face masks, hand sanitizers and general purpose cleaners, and some less understandable, such as toilet paper.

“The familiar bullwhip effect in supply chains—driven by information and product lags, independent decisions by channel partners, and low levels of demand variability—has been overshadowed by unpredictable shocks to end-consumer demand.

“Take toilet paper: Because it’s a commodity, manufacturers have little influence on market prices. To be competitive they must control costs and usually rely on high levels of automation, low levels of labor and high-capacity utilization, with plants running 365/24/7. They can maintain high utilization only because of predicable demand, with low uncertainty and no seasonality.

“Such an unpredictable spike in demand—likely driven by a vicious cycle of panic purchases and perhaps some speculators planning to make quick profits in secondary markets—quickly depleted most of the channel’s inventory. With no excess capacity, we can expect a lag until those products are back on the shelves, which will probably be followed by more panic purchases and secondary spikes. Eventually, with so much forward buying, those supply chains will experience excess inventory.

“Interestingly, once consumers started their lockdowns, their demand for these commodities increased to supplement what they had previously used from supply chains serving the commercial market. For example, in addition to their use at home, consumers used toilet paper at offices, schools, restaurants, malls, etc. This has further strained consumer supply chains and will further delay the time it takes for manufacturers, distributors, wholesalers and retailers to replenish inventory to the new necessary levels.

“Because in several industries supply chains that serve the consumer and commercial markets are different (For instance, commercial toilet paper roles don’t fit residential toilet roll holders.), lockdowns have also created both shortages in consumer supply chains and surpluses in commercial ones. But simply shifting one to the other isn’t feasible, at least in the short term.”

Will the coronavirus change the study of supply chains?

“In supply chain risk management, planners start by identifying and assessing possible risks, which are classified according to their probability and anticipated impact. These are called foreseeable risks, and are managed proactively. Relatively likely risks should be mitigated by measures designed to lower their probability or impact before they happen. Because of limited resources, less likely risks are best managed by contingency measures, which are planned ahead but only triggered after the risk happens. Remaining risks are called residual or ‘unknown unknowns’ and can only be managed reactively. The only proactive measures for those are setting aside time, resources and flexibility to be used once the risks are known. 

“When major unknown unknown risks were modeled in the past, they were usually assumed to happen one at a time and independent of each other. COVID-19 turned out to be an unprecedented set of unknown unknowns all happening in rapid succession, including: A highly contagious pandemic, which quickly traveled across continents, sharp economic downturn globally, a large portion of the population under lockdown, etc.

“In the future a global pandemic of this magnitude will not only be a foreseeable event, but also will likely change how we model unknown unknowns. And depending on how likely similar pandemics are expected to be in the future, a whole slew of mitigation and contingency measures are likely to be considered.”

How long can supply chains withstand shock?

“When either demand or supply are affected, predicting how long supply chains can withstand a shock depends on the severity of the shock, the length of the disruption, and specific factors to each industry.

“What’s interesting about the current situation is that both supply and demand are being affected simultaneously. An important new factor determining the resiliency of each supply chain will be the relative changes in their supply and demand.

“A slowdown in economic activity may end up making it easier to restart some producers, in particularly those who will be able to operate with low overhead and be able to scale as demand picks up.”

Olin’s Nora Williams, associate professor of marketing, has received the AMA-EBSCO Annual Award for Responsible Research in Marketing.

The award honors outstanding research that produces credible and useful knowledge that can be applied to benefit society. 

Williams’ award, which comes with a $1,200 grant, is for the paper “Ethically Deployed Defaults: Transparency and Consumer Protection through Disclosure and Preference Articulation,” published in the Journal of Marketing Research.

“The research examined perceptions of behavioral ‘nudges’ like defaults,” Williams said.

Many decisions come with one option chosen by default, she explained. Think about how many businesses automatically sign up employees to contribute to a retirement fund (versus having them actively opt in). Or when a website makes you uncheck a box if you don’t want to subscribe to emails from that business.

People are much more likely to choose the default option rather than move away from it, regardless of which option is the default. 

“But there has long been a debate among policymakers about whether the use of defaults should be disclosed, and, if it is, whether they will become less effective at encouraging good choices,” Williams said.

The research found that even when the intention behind a default is disclosed, the default is still influential.

“This suggests that policymakers and businesses can be transparent about their use of defaults without making them any less effective,” she said.

‘Better marketing for a better world’

The inaugural recipients of the AMA-EBSCO Annual Award for Responsible Research in Marketing were announced in February at the American Marketing Association’s Winter Academic Conference in San Diego, California.

Williams’ coauthors were Mary Steffel, of Northeastern University, and Ruth Pogacar, of Cincinnati University.

In all, the American Marketing Association recognized 14 research groups for outstanding contributions to the discipline and field of marketing. Their work exemplifies the Seven Principles of Responsible Research, which supports the general notion of “better marketing for a better world.”