Business Feed

"TSMC’s debacle in the American desert"

Even leaving aside the cultural problems which TSMC's management should have been better prepared for--anyone who's been through an MBA program recently probably has had instruction in the importance of corporate culture--the inadequate preparation for the language barrier seems remarkably inept
 
But these problems might be understood as consequences of Newmark's Third Law: if you see a business practice that's very difficult to understand or just plain weird, always ask: is there a government law or regulation or incentive involved? The article alludes to this in just one sentence: "The remaining American workers began speculating that the company only hired them to secure CHIPS Act funding . . ." Indirectly, the article refers to the geopolitical reasons why TSMC built in Arizona. It sounds to me that without those pressures TSMC would never have built in the U.S. And  that Mr. Chang was pessimistic about the U.S. factory supports the idea that TSMC basically had its arm twisted.
 
Link courtesy of Michael G.
 
UPDATE: Link added.

"Diversity Matters/Delivers/Wins Revisited in S&P 500® Firms"

Paper free for download. Abstract:

In a series of influential studies, McKinsey (2015, 2018, 2020) report a statistically significant positive relation between the industry-adjusted EBIT margin of global samples of large public firms and the racial/ethnic diversity of their executives. However, when we revisit McKinsey’s tests using recent data for US S&P 500® firms, we find statistically insignificant relations between McKinsey’s inverse normalized Herfindahl-Hirschman measures of executive racial/ethnic diversity and not only industry-adjusted EBIT margin, but also industry-adjusted sales growth, gross margin, ROA, ROE, and TSR. Our results suggest that despite the imprimatur often given to McKinsey’s (2015, 2018, 2020) studies, caution is warranted in relying on their findings to support the view that US publicly traded firms can deliver improved financial performance if they increase the racial/ethnic diversity of their executives.