Publications

In this paper, we tackle a generic optimal regime switching problem where the decision-making process is not the same from one regime to another. Precisely, we consider a simple model of optimal switching from competition to cooperation. To this end, we solve a two-stage optimal control problem. In the first stage, two players engage in a dynamic game with a common state variable and one control for each player. We solve for open-loop strategies with a linear state equation and linear-quadratic payoffs. More importantly, the players may also consider the possibility to switch at finite time to a cooperative regime with the associated joint optimization of the sum of the individual payoffs. Using theoretical analysis and numerical exercises, we study the optimal switching strategy from competition to cooperation. We also discuss reverse switching.

The liberated company—a company where employees are fully autonomous and accountable for the decisions they take—is a concept about which much has been said and written. Some observers portray it as a major managerial innovation and even as a fully-fledged organizational model for the future. Yet, despite constituting an interesting attempt to address issues related to the changing values and expectations of employees at work, the concept seems more cosmetic than something that will have a significant managerial effect. A clearly better approach is to ask what role managers should adopt, rather than fomenting the idea that the need for management is on the cusp of disappearing altogether. Adopting a more anthropological vision of the company, we suggest instead that a conceptual revision informed by a postmodern reading of this issue, suggests a new way of rethinking managerial attitudes. The main idea here being to no longer try and liberate companies, but instead to lay the foundations so that they themselves become liberating.