Showing papers by "London Business School published in 1992"
TL;DR: In this article, the authors discuss the manner in which the improper use of outsourcing can destroy the future of a business, and how the proper use of outsourced services can help build competitive advantage.
Abstract: Executive Overview The improper use of outsourcing is playing an important role in the continuing competitive decline of many Western firms. Western managers often view outsourcing as a defensive operational measure. The approach tends to be incremental. A whole series of incremental outsourcing decisions, taken individually, may make economic sense, but collectively they may also represent the surrender of the business's capability to compete. However, properly understood and managed as an overall part of strategy, outsourcing can aid competitiveness. This article, based on the authors' research with firms in North America. Europe, and Asia, discusses the manner in which the improper use of outsourcing can destroy the future of a business, and how the proper use of outsourcing can help build competitive advantage.
555 citations
TL;DR: This paper examined whether this refocusing created market value for the companies involved and found that refocusing did not increase the market value of the companies in the context of diversification, but instead reduced their diversification by refocusing.
Abstract: During the 1980s, many diversified firms reduced their diversification by refocusing. This study examined whether this refocusing created market value for the companies involved. It is shown that r...
377 citations
TL;DR: The paper explains how the modelling process fits into conventional management team meetings, and then contrasts the value chain methodology and system dynamics in order to illustrate the variety of group and cognitive support provided by different maps and frameworks.
211 citations
Journal Article•
TL;DR: In an effort to govern their increasingly complex organizations, chief executives in some of today's largest corporations are turning to one of the world's oldest political philosophies-federalism, guided by five principles.
Abstract: In an effort to govern their increasingly complex organizations, chief executives in some of today's largest corporations are turning to one of the world's oldest political philosophies-federalism. Given that organizations are seen more and more as minisocieties, the prospect of applying political principles to management makes a great deal of sense. Federalism is particularly appropriate because it offers a well-recognized system for dealing with paradoxes of power and control: the need to make things big by keeping them small; to encourage autonomy but within bounds; and to combine variety and shared purpose, individuality and partnership, local and global. As London Business School professor Charles Handy explains it, federalism responds to these paradoxes by balancing power among those in the center of the organization, those in the centers of expertise, and those in the center of the action--the operating businesses. The centers of federal organizations meet regularly, but they do not need to live together. Doing so would concentrate too much power in one place, whereas federalism gets its strength and energy from spreading responsibility across many decision points. Guided by five principles, federalism avoids the risks of autocracy and the overcontrol of a central bureaucracy. It ensures a measure of democracy and creates a "dispersed center" that is more a network than a place. That's why Asea Brown Boveri CEO Percy Barnevik calls his sprawling "multi-domestic" enterprise of 1,100 separate companies and 210,000 employees a federation. It succeeds because the independent bits, be they individuals, clusters, or business units, know they are part of the greater whole.
168 citations
TL;DR: In this paper, the authors provide insights into how the investment in capacity for generation could evolve according to various regulatory conditions, economic assumptions, degrees of competition and the strategic behaviour of the separate companies.
160 citations
TL;DR: A framework to determine manufacturing planning and control system requirements that reflect differences in manufacturing strategy and process technology in a business is presented.
Abstract: Presents a framework to determine manufacturing planning and control system requirements that reflect differences in manufacturing strategy and process technology in a business. Manufacturing planning and control systems represent a critical part of the manufacturing infrastructure and support functions, and their design needs to be closely linked to decisions regarding a firm′s manufacturing strategy and choice of processes. Discusses examples of companies which have developed a good fit between their manufacturing planning and control systems and their manufacturing strategy in terms of the framework presented.
140 citations
TL;DR: For managers in large-scale organizations, careers have traditionally provided a set of organizing principles around which they have been able to structure both their private and professional lives as mentioned in this paper, and through them, they were able to experience a sense of security, stability, and order.
Abstract: For managers in large-scale organizations, careers have traditionally provided a set of organizing principles around which they have been able to structure both their private and professional lives. Through them, they have been able to experience a sense of security, stability, and order. Personal feelings of growth and advancement have been achieved through jobs which provide not only the opportunities for the completion of specific tasks but also a mean whereby longer-term personal goals can be achieved. Indeed, the combined promise of job security and advancement within corporate hierarchies-as linked with incremetal increases in authority, status, and pay-have constituted the major rewards of the modern managerial career. It has been largely through these mechanisms that large-scale organizations have been able to obtain the motivation and commitment of their managerial staff. During the 1980s, however, a variety of technological, organizational, and broader social changes have led many observers to s...
114 citations
TL;DR: In this paper, the authors examined the productivity performance of nine of the largest enterprises over the last twenty years and concluded that a large part of the observed upturn in productivity is a result of changes in efficiency.
Abstract: The reforms in the regulation of the UK'nationalised industries over the last decade are examined and the extent to which they have been successful in achieving one of their declared aims – that of increasing the efficiency of the enterprises' operations – is considered. To achieve this the productivity performance of nine of the largest enterprises over the last twenty years was analysed. The results show that the rate of productivity growth has been significantly higher during the 1980s, compared with the preceeding decade. It is concluded that a large part of the observed upturn in productivity is a result of changes in efficiency.
109 citations
TL;DR: The 1990s look different from the 1980s: IT expenditures are no longer rising, value for money questions are being asked about IT, changes are being made to IT organization structures and IS Directors are losing their jobs as mentioned in this paper.
Abstract: The 1980s were characterized by rapid developments in information technologies, continuously rising IT expenditures in firms and high hopes about the pay-off of IT investments. In many ways, the great expectations of IT seemed to encourage organizations to manage IT as a special case, somehow above the norms of conventional policy and practice. The 1990s look different. IT expenditures are no longer rising, value for money questions are being asked about IT, changes are being made to IT organization structures and IS Directors are losing their jobs. Michael Earl argues for a more realistic approach to managing IT. He calls it “putting the business back into IT”.
93 citations
TL;DR: In this article, the authors put recent industrial policy debates into a somewhat wider perspective by developing a neglected argument about the design of industrial policy: that problems of technological stagnation are not always caused by the production of'too few' innovations so much as they are caused by problems associated with a too limited use of innovations, or with bottlenecks in the supply of crucial inputs.
Abstract: The goal of this essay is to put recent industrial policy debates into a somewhat wider perspective by developing a neglected argument about the design of industrial policy: that problems of technological stagnation are not always caused by the production of ' too few' innovations so much as they are caused by problems associated with a too limited use of innovations, or with bottlenecks in the supply of crucial inputs. It follows from this that policies applied to innovation producing industries ('horizontal strategies' hereafter) may not be as efficacious as those applied to upstream supplier or to downstream user industries ('vertical strategies' hereafter). The major gain that comes from exploring this line of argument is that it identifies a number of slightly unusual policy options that might be used to stimulate industrial innovation. The argument proceeds in three steps. We start in Section II by reviewing the classic arguments (and recent evidence) about market failure and R&D. While market failures may bedevil the production of knowledge, the gain to innovation can often be realized by an innovator if knowledge is embodied in output, particularly when the innovator can control the market in which that output is sold. It follows, then, that a natural appropriation strategy to pursue is to embody new knowledge in specific goods, or, even better, in a package of complementary goods and services. Further, the ability of an innovator to produce a commercially successful product may turn on his/her ability to stimulate the production of necessary complementary inputs, and to mobilize demand. We shall argue in Section III that these observations are consistent with a considerable body of empirical evidence about the determinants of successful innovations, and they imply that vertical strategies are often (but not always) rather more attractive than horizontal ones for those interested in the design of policies to stimulate innovation. We close the essay in Section IV with a few speculations on policy options associated with the use of vertical strategies.
83 citations
TL;DR: In this paper, the authors identify the characteristics that distinguished the companies that refocused from those that did not, and find that relative to their industry counterparts, the refocusing firms were characterized by high diversification and poor performance.
Abstract: SUMMARY
During the 1980s, many diversified firms reduced their diversification by refocusing on their core businesses. This research note tries to identify the characteristics that distinguished the companies that refocused from those that did not. It is found that relative to their industry counterparts, the refocusing firms were characterized by high diversification and poor performance. In addition, a firm was more likely to refocus if its core industry was ‘attractive’.
TL;DR: In this paper, the authors focus on the application of manufacturing based concepts in a service environment and their application in a UK environment, using the service factory concept developed by Richard Chase (1988).
Abstract: Much of the writing on Service in the Operations Management literature has focused on the application of manufacturing based concepts in a service environment1.There has been a limited amount of consideration of the service element of manufacturing companies such as field service operations2, but only recently has the reverse begun to take place. A key contribution to this reverse trend is the ‘service factory’ concept developed by Richard Chase (1988). The research in this paper focuses on this concept and its application in a UK environment.
TL;DR: A group of senior managers and planners from a major oil company met to discuss the changing structure of the oil industry with the purpose of improving group understanding of oil market behaviour for use in global scenarios as mentioned in this paper.
TL;DR: There is increasing interest in ‘hybrid managers’, a breed of managers who blend information management skills with general management skills, which are perceived as important in enabling organizations to exploit information systems effectively in today's competitive business environment.
Abstract: . There is increasing interest in ‘hybrid managers’, a breed of managers who blend information management skills with general management skills. Such people are perceived as important in enabling organizations to exploit information systems effectively in today's competitive business environment.
Based on a literature survey this paper summarizes what we know about hybrid managers, as expressed by both ‘expert opinion’ and formal research studies. We conclude that little substantive research has been conducted into hybrid managers. Much has still to be learnt about their possible role, characteristics and competences; and how organizations should recruit and develop them. Because of the paucity of published material about ‘hybrids’ in the information systems context, we have drawn inferences from appropriate analogues in other functions — namely personnel, finance and R&D. Relevant studies in related areas of information systems, general management, careers and management development are also put into the ‘hybrid’ context.
TL;DR: In this paper, the authors show that the basic insight of the benefit-cost analysis, namely that a greater quantity of natural environments should be protected than is indicated by current valuations, holds under more general conditions than previously indicated.
TL;DR: Argues, based on empirical data from 15 UK engineering companies, that effective implementation of integrating technology requires a better understanding of issues concerning the integration of functions/tasks involved, and proposes alternative organizational and technical mechanisms for implementing such integration.
Abstract: Companies are increasingly adopting technologies that can promote integration between functions and tasks. The implementation of these technologies has largely concerned the tasks of installation and the technical integration of the system. However, insufficient attention appears to have been directed towards organizational and managerial integration issues. Argues, based on empirical data from 15 UK engineering companies, that effective implementation of integrating technology requires a better understanding of issues concerning the integration of functions/tasks involved. Focuses on the issues and problems concerning managers involved with improving engineering/production integration, and proposes alternative organizational and technical mechanisms for implementing such integration. Reviews these mechanisms by reference to the engineering case companies.
TL;DR: In this annual Blackett Lecture, a description is given of how the position of management in Britain has changed over the second half of the century; the qualities required for successful management as discussed by the authors.
Abstract: In this annual Blackett Lecture, a description is given of how the position of management in Britain has changed over the second half of the century; the qualities required for successful m...
TL;DR: In this article, the authors summarize the available literature on divestitures and point out the kinds of divestiture and the implementation tactics associated with value destruction, which should help managers improve their divestment effectiveness.
TL;DR: Recently, new approaches to economic growth, often borrowing from earlier, non-orthodox, interpretations, have underlined the importance of investment in both physical and human capital, of scale economies or of learning by doing as mentioned in this paper.
Abstract: The orthodox theory of economic growth has long been unable to explain some real world "stylized.facts" such as the reasons for continued long-run expansion, the absence of convergence in per capita incomes across rich and poor countries and the frequent presence of medium-term changes in growth rates. Recently, new approaches to economic growth, often borrowing from earlier, non-orthodox, interpretations, have underlined the importance of investment in both physical and human capital, of scale economies or of learning by doing. These "endogenous growth" theories, however, are as yet largely untested, and hence unable to provide clear lessons for policy-making. Copyright 1992 by Oxford University Press.
TL;DR: In this paper, the authors examine the successful and unsuccessful use of new process technologies and argue that management of innovation of processes must cover the whole life cycle of its innovation and adoption, and in particular should include implementation.
Abstract: When we talk of innovation we tend to think of new products, but successful innovation of processes can also lead to a company gaining significant competitive advantage. A good example is to be found in the recent book, The Machine that Changed the World, by Womak et al (1990). The machine in question is process technology and the book's argument is that process innovations which they aggregate as ‘lean production’ are responsible for the level of performance of the Japanese car industry. On the other hand many expensive investments in the latest Flexible Manufacturing Systems have worked, but have sometimes been less flexible than the processes that they replaced! Why is it that one firm can adopt a new production process and gain real benefits, and another can adopt the same new process; invest heavily in equipment and installation, yet not be able to achieve any benefit? This important question has been addressed in a series of recent research programmes undertaken at London Business School. This article examines some of what we and others have learnt about the successful and unsuccessful use of new process technologies. In addition it will argue that management of innovation of processes must cover the whole life cycle of its innovation and adoption, and in particular should include implementation.
TL;DR: A game theoretic model of joint quality control in a single sourcing environment which integrates supplier and customer decisions is developed and numerical examples of Stackelberg and Nash equilibria are presented, indicating how optimal strategies depend on the parameters of the problem.
Abstract: We develop a game theoretic model of joint quality control in a single sourcing environment which integrates supplier and customer decisions. In this model, both parties behave strategically and take each other's incentives into account when deciding on their respective sampling plans. The specific sampling plans considered are of the “single sample fraction defective with rectifying inspection” type. A method to find the optimal sampling plans for both supplier and customer in two different informational setups is constructed. The resulting models lead to examination of Stackelberg and Nash equilibria. Numerical examples of such equilibria are presented, indicating how optimal strategies depend on the parameters of the problem.
TL;DR: In this article, the authors make the starkest assumption of no credibility under EMU, and compare it with hard-EMS for various supply and demand shocks using a two-bloc model, the latter exhibiting short run wage/price stickiness but with long run natural rate properties.
TL;DR: A convergent development between European countries can be observed in terms of the extension of functional flexibility, enlarging production workers' jobs, and introducing teamwork arrangements, which can be explained by different management strategies and industrial relations systems as discussed by the authors.
Abstract: A convergent development between European countries can be observed in terms of the extension of functional flexibility, enlarging production workers’ jobs, introducing teamwork arrangements. In the literature, the emphasis has traditionally been on divergence between countries, which was explained in terms of different management strategies and industrial relations systems.