Nicolaj Siggelkow

• Nicolaj Siggelkow and Christian Terwiesch (2023), Create Winning Customer Experiences with Generative AI, Harvard Business Review. Abstract

  The launch of ChatGPT will be remembered in business history as a milestone in which artificial intelligence moved from many narrow applications to a more universal tool that can be applied in very different ways. While the technology still has many shortcomings (e.g., hallucinations, biases, and non-transparency), it’s improving rapidly and is showing great promise. It’s therefore a good time to start thinking about the competitive implications that will inevitably arise from this new technology. Many executives are wrestling with the question of how to take advantage of this new technology and reimagine the digital customer experience? For value creation to happen, we have to think about large language models as a solution to an unmet need, which requires a precise understanding about the pain points in customer experiences. From finance to healthcare and from education to travel, industry observers expect an explosion of service innovations and new digital user experiences on the horizon.

• Daniel Albert and Nicolaj Siggelkow (2022), Architectural Search and Innovation, Organization Science, 33 (1), pp. 275-292. Abstract

  Product innovation can result from the novel design and combination of product components as well as from changing the underlying architecture, that is, the way components interact with each other. Even though previous studies have shown that architectural change can constitute a powerful source of innovation, little insight exists on how organizations should engage in architectural search itself. In this paper, using computer simulation, we explore underlying mechanisms of architectural search. We find that contrary to search for component combinations, architectural search provides greater performance improvements the narrower the search scope, regardless of product complexity. Moreover, our theory and findings suggest a more differentiated typology of architectural innovation. While narrow architectural search often leads to pure architectural innovations that do not require substantial component changes, broader architectural search often leads to composite architectural innovation, i.e., architectural innovations that typically render existing component designs suboptimal, but allow for new high-performing component combinations to arise. Lastly, while narrow architectural search outperforms broad architectural search in the long run, in the short run, broad architectural search can have performance advantages.

• Emanuele Borgonovo, Marco Pangallo, Jan Rivkin, Leonardo Rizzo, Nicolaj Siggelkow (2022), Sensitivity Analysis of Agent-Based Models: A New Protocol, Computational and Mathematical Organization Theory, 28 (1), pp. 52-94. Abstract

  Agent-based models (ABMs) are increasingly used in the management sciences. Though useful, ABMs are often critiqued: it is hard to discern why they produce the results they do and whether other assumptions would yield similar results. To help researchers address such critiques, we propose a systematic approach to conducting sensitivity analyses of ABMs. Our approach deals with a feature that can complicate sensitivity analyses: most ABMs include important non-parametric elements, while most sensitivity analysis methods are designed for parametric elements only. The approach moves from charting out the elements of an ABM through identifying the goal of the sensitivity analysis to specifying a method for the analysis. We focus on four common goals of sensitivity analysis: determining whether results are robust, which elements have the greatest impact on outcomes, how elements interact to shape outcomes, and which direction outcomes move when elements change. For the first three goals, we suggest a combination of randomized finite change indices calculation through a factorial design. For direction of change, we propose a modification of individual conditional expectation (ICE) plots to account for the stochastic nature of the ABM response. We illustrate our approach using the Garbage Can Model, a classic ABM that examines how organizations make decisions.

• Nicolaj Siggelkow and Christian Terwiesch, “New Business Models for the Digital Age: From After-Sale Services to Connected Strategies”. In Creating Values with Operations and Analytics, edited by Hau Lee, Ricardo Ernst, Arnd Huchzermeier, Shiliang Cui, (Berlin: Springer, 2022), pp. 23-39 Abstract

  More and more firms use connected technologies to reshape fundamentally the way in which they interact with their customers. Rather than having few episodic interactions, companies are trying to create a continuous relationship with their customers that reduces friction and allows companies to anticipate the needs of their customers. In this chapter, we discuss new business models enabled by this development. We do so by reviewing some of the literature on after-sales services in general and some of Morris Cohen’s pioneering research in particular. We then extend this prior work by articulating a framework of “Connected Strategy” in the form of a taxonomy of four connected customer experiences. Finally, we apply our Connected Strategy framework to the domain of healthcare delivery.

• Nicolaj Siggelkow and Christian Terwiesch (2021), Designing a Seamless Digital Experience for Customers, Harvard Business Review. Abstract

  Connected strategies can become a powerful new source of competitive advantage. And connected technologies have greatly advanced over the recent past. Customers and employees are increasingly expecting well-designed digital experiences, a trend that certainly has further accelerated during the pandemic. Consequently, the question companies face currently is not a matter of “whether they should implement a connected strategy,” but a matter of “how.” When designing a successful connected strategy, the technological innovation is only one piece of the puzzle. In order to create a lasting competitive advantage, companies need to match the right technological solutions with the right customer needs. This article discusses four connected customer experiences that firms can create: 1) respond-to-desire; 2) curated offering, 3) coach behavior, and 4) automatic execution, to turn episodic interactions with customers into continuous relationships.

• Phebo Wibbens and Nicolaj Siggelkow (2020), Introducing LIVA to Measure Long-Term Firm Performance, Strategic Management Journal, 41 (5), pp. 867-890. Abstract

  This article introduces a new measure of long-term firm performance: long-term investor value appropriation (LIVA). This measure helps to address a disconnect between the common theoretical assumption that managers optimize firm value, and the widespread empirical practice of measuring performance using short-term ratios such as return on assets (ROA). LIVA can lead to markedly different strategic insights compared to commonly used measures such as ROA and cumulative abnormal returns. For instance, the widely cited finding of a U-shaped relation between acquisition experience and performance turns out to be largely driven by short-term stock price movements and vanishes when using 10-year LIVA.

• Nicolaj Siggelkow and Phebo Wibbens (2020), What is the Best Way to Create Long-Term Value?, Harvard Business Review. Abstract

  The authors propose a new tool for measuring the creation of long-term value, use it to rank the best and worst performers, and then compare those results with the results of more traditional measures. The exercise exposes revealing differences.

• Nicolaj Siggelkow and Christian Terwiesch (2019), Five Questions to Consider When Pricing Smart Products, Harvard Business Review. Abstract

  The revenue model is one of the most important elements of a firm’s strategy. It defines the ways in which a firm gets compensated for the value that its products or services generate. In the old days, revenue models primarily consisted of picking a “good” price. Connected, smart devices are changing this paradigm. To think systematically about revenue models and to spot opportunities for improvement, consider: what is paid for, when the payment is made, who is paying, why the customers are paying, and what currency the customer is paying with.

• Nicolaj Siggelkow and Christian Terwiesch, Connected Strategy (: Harvard Business Review Press, 2019)
• Nicolaj Siggelkow and Christian Terwiesch (2019), The Age of Continuous Connection, Harvard Business Review.
• All Research from Nicolaj Siggelkow »

Current Courses

• HCIN6012 - Connected Health Care

  Connected strategies have the potential to radically transform health care business models. By designing connected relationships and architectures, and developing digital and analog networks, we may be able to improve quality of care while also making efficient use of resources. These strategies can enhance existing organizations and can also foster disruptive innovation. In the first 4 weeks of the course, we will practice using the conceptual and practical components of connected strategies, including: • Building connected customer relationships • Designing connection architectures • Understanding new revenue models • And creating the infrastructure of connection In the final 2 weeks, you will methodically apply what you have learned to design a connected strategy for your organization or service, and you will come away with a body of work you will be able to build upon in future endeavors. After completing this course, you will be able to: 1. Identify points along the customer or patient journey that are good candidates for innovation. 2. Customize connected relationships to anticipate and seamlessly meet customer needs. 3. Discern financial opportunities offered by the implementation of connected strategies. 4. Select technological solutions that facilitate the implementation of connected relationships. 5. Create comprehensive connected strategies that are applicable in health care settings.

  HCIN6012001

  HCIN6012002

• MGMT7010 - Strategy And Competitive Advantage

  This course is concerned with strategy issues at the business unit level. Its focus is on the question of how firms can create and sustain a competitive advantage. A central part of the course deals with concepts that have been developed around the notions of complementarities and fit. Other topics covered in the course include the creation of competitive advantage through commitment, competitor analysis, different organizational responses to environmental changes, modularity, and increasing returns. An important feature of the course is a term-length project in which groups of students work on firm analyses that require the application of the course concepts.

  MGMT7010002 ( Syllabus )

  MGMT7010004 ( Syllabus )

• MGMT7230 - Strategy And Environmental Sustainability

  Environmental sustainability issues are one of the defining problems of our time. While governments and NGOs will have to play important roles, without active involvement of businesses it will be impossible to make sufficient progress on these issues. Globalization and Digitization have been two major disruptive developments that organizations have faced (and are still facing). ESG (Environmental, Social, and Governance) issues are the latest large-scale development that will shape companies’ futures. This course will focus on the “E” of ESG. As with any large change, environmental sustainability poses significant business challenges but also tremendous opportunities. We will study these issues both from the perspective of incumbent firms that have to adapt their business practices and from firms (incumbents and new start-ups) that will take advantage of the new opportunities that are being created.

  MGMT7230002 ( Syllabus )

  MGMT7230004 ( Syllabus )

Past Courses

• HCIN6012 - Connected Health Care

  Connected strategies have the potential to radically transform health care business models. By designing connected relationships and architectures, and developing digital and analog networks, we may be able to improve quality of care while also making efficient use of resources. These strategies can enhance existing organizations and can also foster disruptive innovation. In the first 4 weeks of the course, we will practice using the conceptual and practical components of connected strategies, including: • Building connected customer relationships • Designing connection architectures • Understanding new revenue models • And creating the infrastructure of connection In the final 2 weeks, you will methodically apply what you have learned to design a connected strategy for your organization or service, and you will come away with a body of work you will be able to build upon in future endeavors. After completing this course, you will be able to: 1. Identify points along the customer or patient journey that are good candidates for innovation. 2. Customize connected relationships to anticipate and seamlessly meet customer needs. 3. Discern financial opportunities offered by the implementation of connected strategies. 4. Select technological solutions that facilitate the implementation of connected relationships. 5. Create comprehensive connected strategies that are applicable in health care settings.

• MGMT6130 - Manag Estab Enterprise

• MGMT7010 - Strat & Compet Advantage

  This course is concerned with strategy issues at the business unit level. Its focus is on the question of how firms can create and sustain a competitive advantage. A central part of the course deals with concepts that have been developed around the notions of complementarities and fit. Other topics covered in the course include the creation of competitive advantage through commitment, competitor analysis, different organizational responses to environmental changes, modularity, and increasing returns. An important feature of the course is a term-length project in which groups of students work on firm analyses that require the application of the course concepts.

• MGMT7230 - Strat & Environ Sustainability

  Environmental sustainability issues are one of the defining problems of our time. While governments and NGOs will have to play important roles, without active involvement of businesses it will be impossible to make sufficient progress on these issues. Globalization and Digitization have been two major disruptive developments that organizations have faced (and are still facing). ESG (Environmental, Social, and Governance) issues are the latest large-scale development that will shape companies’ futures. This course will focus on the “E” of ESG. As with any large change, environmental sustainability poses significant business challenges but also tremendous opportunities. We will study these issues both from the perspective of incumbent firms that have to adapt their business practices and from firms (incumbents and new start-ups) that will take advantage of the new opportunities that are being created.

• MGMT7820 - Strategic Implementation

  Much more is known about strategy formulation than its implementation, yet valid, sensible strategies often fail because of problems on the implementation side. This course provides you with tools to turn good strategy into successful reality. It covers the choices, structure, and conditions that enable the successful attainment of strategic objectives. Students learn from rigorous academic research on successful implementation, as well as a series of seasoned business leaders who will visit to share their own experience from the front lines.

• MGMT7990 - Special Topics MGMT

  Courses offered of various topics and points of focus, ranging across multiple concentrations of Management, (i.e., Entrepreneurial, Strategy, Organizational Business, etc.).

• MGMT8910 - Advanced Study-Smgt

• MGMT8970 - Global Modular Course A

  Special course arranged for Wharton MBA students, focused on global business, management and innovation.

• Wharton Teaching Excellence Award, 2020
• Excellence in Teaching Award, Wharton Executive MBA Program, West Coast, 2015
• Excellence in Teaching Award, Wharton, MBA Program, 2015
• Excellence in Teaching Award, Wharton, MBA Program, 2014
• Excellence in Teaching Award, Wharton Executive MBA Program, West Coast, 2014
• Excellence in Teaching Award, Wharton Executive MBA Program, East Coast, 2014
• Core Curriculum Teaching Award, Wharton, 2013
• Fellow of the Strategic Management Society, 2013
• Excellence in Teaching Award, 2012
• Student-elected Faculty Marshal, 2011
• Excellence in Teaching Award, 2010
• Helen Kardon Moss Anvil Teaching Award, 2010
• Student-elected Faculty Marshal, 2010
• Administrative Science Quarterly Scholarly Contribution Award for the most significant paper published in ASQ five years earlier, 2008
• Class of 1984 Award (presented to the faculty member with the highest teaching rating in the MBA classroom), 2006
• Excellence in Teaching Award, 2006
• Excellence in Teaching Undergraduates Award, 2005
• The (inaugural) Wharton Graduate Association Student Choice Award (for commitment to teaching excellence), 2005
• Class of 1984 Award (presented to the faculty member with the highest teaching rating in the MBA classroom), 2004
• The Wharton Award (awarded by MBA students to “the professor who has contributed the most to students’ experience at Wharton”), 2004
• Student-elected Faculty Marshal, 2004
• Excellence in Teaching Award, 2003
• Excellence in Teaching Undergraduates Award, 2003
• Excellence in Teaching Award, 1999

• Warren Buffett's Big Secret - 02/29/2012

Knowledge @ Wharton

• Building Stronger Family Offices by Sharing Knowledge and Securing the Future, Knowledge @ Wharton - 11/21/2024
• State of the NBA with Seth Partnow, Knowledge @ Wharton - 11/20/2024
• How Are Companies Really Using AI? A New Report Has Answers, Knowledge @ Wharton - 11/19/2024
• Impact vs. Time: A Leader’s Guide to Slow Productivity, Knowledge @ Wharton - 11/19/2024
• Kevin O’Leary Illustrates the Benefits of Tariffs for U.S. Businesses, Knowledge @ Wharton - 11/19/2024
• Boosting Donations Through Self-expressive Choices | Jonah Berger, Knowledge @ Wharton - 11/19/2024
• Why Are Hospitals So Expensive?, Knowledge @ Wharton - 11/18/2024
• New Phenomena in Behavioral and Social Investing, Knowledge @ Wharton - 11/18/2024
• Bigger Hospitals, Better Care? Wharton Research Finds Benefits Are Only at the Operational Level, Knowledge @ Wharton - 11/14/2024
• Linda Dow Cash, CEO, Two Chicks Cocktails, Knowledge @ Wharton - 11/14/2024