In what he describes as his third career, Michael Greiner, Ph.D., is merging his lifelong passion for politics with expertise in finance law and government to advance understanding at the intersection of politics, economics and management.
As Assistant Professor of Management in OU’s School of Business Administration, Dr. Greiner draws on his diverse experience ranging from managing political campaigns across the country to serving as Deputy Mayor of Warren, to helping thousands of families and businesses restructure their debt as a bankruptcy lawyer.
Dr. Greiner explores this intersection for his research, the OU business courses he leads and the commentaries he publishes regularly on Medium. His research interests include corporate political activity (CPA), corporate social responsibility (CSR), stewardship theory, and agency theory. His research work focuses on practical insight that can help businesses large and small plan for success.
Dr. Greiner tapped into his expertise to offer business strategists guidance into navigating today’s economic crisis through an article published in Harvard Business Review titled, “Avoid making this strategic mistake in a recession.” The article compares the cost leader and product differentiator approaches. In a macroeconomic crisis like the Great Recession or the COVID-19 pandemic, Dr. Greiner says cost leaders usually fare better than differentiators.
"The cost leaders have seen a one-to-one change," he says. "The people they used to have as customers drop out of the market, or have less money to spend, and the customers of the differentiators kind of shift into their space."
However, he discourages differentiators from pivoting to a cost leadership strategy. Existing cost leaders have a "head start" and differentiators "are literally never able to catch up with them," he says. Dr. Greiner references his mother's antiques shop as an example. As a purveyor of high-end specialty goods, she is a differentiator, but she has focused on deepening her relationships with existing customers since the pandemic hit.
"You just have to hold on and try to survive through the uncertainty," Dr. Greiner says. "Trying to shift all of a sudden because of the larger struggles the economy may be experiencing, you're going to lose customers and you're not going to pick up the new customers that you need."
Dr. Greiner’s research also deals heavily with ethical questions, especially pertaining to his research interest in CPA. Defined as corporate attempts to shape government policy, many organizational leaders believe that CPA can provide a competitive advantage.
In a recent paper, "A supply-side approach to corporate political activity: Performance consequences of ideologically driven CPA," Dr. Greiner examines how the political ideologies that firms support through CPA can affect their financial outcomes. The paper delves into agency theory, analyzing the degree to which corporate executives act in their own interest versus that of their shareholders.
Dr. Greiner found that managers who have greater control over funds for CPA tend to fund more ideologically extreme politicians aligning with their personal views. He also found that such behavior resulted in very little actual political influence for their firms, and correspondingly little impact on the firm's performance.
"Instead of money being given to politicians to convince them to vote one way or another, money is given to politicians who already support an issue," he says. In addition to expending funds on CPA without enjoying the performance benefits, “this can be an added driver of the increased polarization that we're seeing in our political system."
Conversely, firms that participated in more ideologically moderate CPA – and had less managerial discretion over their firms CPA funds – realized much greater performance benefits. Essentially, the paper notes, when managers view CPA as something that must be approached in an ideologically moderate fashion to forward the goals of the firm, firms tend to perform better for shareholders.
“This kind of CPA also benefits American society at large,” Dr. Greiner says.
March 15, 2021
By Patrick Dunn
