Analysis of Extremes in Management Studies

The potential advantage of extreme value theory in modeling management phenomena is the central theme of this paper. The statistics of extremes have played only a very limited role in management studies despite the disproportionate emphasis on unusual events in the world of managers. An overview of this theory and related statistical models is presented, and illustrative empirical examples provided. Res Co All ISS As I am sure almost every geophysicist knows, distributions of actual errors and fluctuations have much more straggling extreme values than would correspond to the magic bell-shaped distribution of Gauss and Laplace. John Tukey Consider the coast of Norway. It appears jagged whether measured in kilometers, meters, centimeters, or millimeters. This is called scalability – no matter what the scale of measurement, the phenomena appear the same. Scalability equates to what Benoit Mandelbrot (1982) calls fractal geometry. A cauliflower is an obvious example. Cut off a floret, cut a smaller floret from the first floret, then an even smaller one, and another one stilly . Now set them all on a table, in line. Each fractal subcomponent is smaller than the former, but each has the same shape and structure. earch Methodology in Strategy and Management, Volume 3, 123–196 pyright r 2006 by Elsevier Ltd. rights of reproduction in any form reserved N: 1479-8387/doi:10.1016/S1479-8387(06)03007-4