Hope for shareholders; warning for salesmen
In these roller coaster times for the economy, there is qualified hope: operations researchers report that peoples reaction to a sequence of occurrences in which an initial event is unexpectedly reversed is more favorable if the first event is a loss than if it is a gain, according to a study in a journal of the Institute for Operations Research and the Management Sciences (INFORMS®). "Our research supports the casual observation that surprising "bad news, good news" sequences leave a positive impression, and not just because the last event is freshest in mind," says Akshay R. Rao, General Mills Professor of Marketing at the University of Minnesotas Carlson School of Management.
"Close Encounters of Two Kinds: False Alarms and Dashed Hopes" is by Dr. Haipeng (Allan) Chen, Assistant Professor of Marketing at the University of Miamis School of Business Administration and Dr. Rao. It appears in the journal Marketing Science, an INFORMS publication. A summary of the study can be found online at http://www.informs.org/Press/dashedhopesabstract.pdf
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