Showing papers in "Academy of Management Executive in 1988"

Successful vs. Effective Real Managers

Abstract: W hat do successful managers those who have been promoted relatively quickly have in common with effective managers those who have satisfied, committed subordinates and high performing units? Surprisingly, the answer seems to be that they have little in common. Successful managers in what we define as "real organizations" large and small mainstream organizations, mostly in the mushrooming service industry in middle America are not engaged in the same day-to-day activities as effective managers in these organizations. This is probably the most important, and certainly the most intriguing, finding of a comprehensive four-year observational study of managerial work that is reported in a recent book by myself and two colleagues, titled Real Managers.1 The startling finding that there is a difference between successful and effective managers may merely confirm for many cynics and "passed over" managers something they have suspected for years. They believe that although managers who are successful (that is, rapidly promoted) may be astute politicians, they are not necessarily effective. Indeed, the so-called successful managers may be the ones who do not in fact take care of people and get high performance from their units. Could this finding explain some of the performance problems facing American organizations today? Could it be that the successful managers, the politically savvy ones who are being rapidly promoted into responsible positions, may not be the effective managers, the ones with satisfied, committed subordinates turning out quantity and quality performance in their units? This article explores the heretofore assumed equivalence of "successful managers" and "effective managers." Instead of looking for sophisticated technical or governmental approaches to the performance problems facing today's organizations, the solution may be as simple as promoting effective managers and learning how they carry out their jobs. Maybe it is time to turn to the real managers themselves for some answers. And who are these managers? They are found at all levels and in all types of organizations with titles such as department head, general manager, store manager, marketing manager, office manager, agency chief, or district manager. In other words, maybe the answers to the performance problems facing organizations today can be found in their own backyards, in the managers themselves in their day-today activities. The Current View of Managerial Work

Career Issues in International Assignments

Abstract: M uch research in international human resource management has focused on the selection and training of personnel for overseas assignments, such as the criteria for selecting candidates and training programs to prepare personnel for cross-cultural encounters. An often neglected area of research in international human resource management is what happens to the subsequent career path of the individual upon return. In other words, did the international assignment have a positive impact on the person's overall career development and subsequent advancement in the organization? In this article I will explore some of the career issues associated with repatriation. The findings presented here are based on in-depth interviews with the vice-president of foreign operations or the vice-president of human resources in 17 European, 18 Japanese, and 11 Australian multinationals. In many cases, people who have served on overseas assignments in their respective companies were also interviewed. These findings were compared with those from interviews with the director of human resource management in 20 U.S. multinationals and a questionnaire survey of 80 U.S. multinationals. (The multinationals from the various countries came from a variety of industries and services, including automobiles, banking and finance, steel and chemical manufacturing, general trading, and so on.) Career Issues in Repatriation

Choosing an Involvement Strategy

Abstract: The most prevalent approach to designing work organizations calls for such features as hierarchical decision making, simple repetitive jobs at the lowest level, and rewards based on carefully measured individual job performance. But this "control" approach appears to be losing favor. Numerous articles and books have recently argued that work organizations need to move toward an "involvement" or "commitment" approach to the design and management of work organizations.' The advantages of the involvement approach are said to include higher quality products and services, less absenteeism, less turnover, better decision making, and better problem solving in short, greater organizational effectiveness.2 Careful examination of the suggested ways to increase involvement reveals not one but at least three approaches to managing organizations. All three encourage employee participation in decision making. These three approaches, however, have different histories, advocates, advantages, and disadvantages. An organization interested in adopting an involvement-oriented approach needs to be aware of the differences among these approaches and strategically choose the approach that is best for it. The three approaches to involvement are (1) parallel suggestion involvement, (2) job involvement, and (3) high involvement. They differ in the degree to which they direct that four key features should be moved to the lowest level of an organization. Briefly, the features are: (1) information about the performance of the organization, (2) rewards that are based on the performance of the organization, (3) knowledge that enables employees to understand and contribute to organizational performance, and (4) power to make decisions that influence organizational direction and performance. Information, rewards, knowledge, and power are the central issues for all organizations. How they are positioned in an organization determines the core management style of the organization. When they are concentrated at the top, traditional control-oriented management exists; when they are moved downward, some form of participative management is being practiced. The parallel suggestion approach does the least to move power, knowledge, information, and rewards downward, while the high involvement approach does the most. Because they position power, information, knowledge, and rewards differently, these approaches tend to fit different situations and to produce different results. It is not that one is always better than another, but that they are different and, to some degree, competing. Let us consider how these three approaches operate, and the results they produce. Once we have reviewed them, we can discuss when and how they are best used.

Cultivating an Image of Justice: Looking Fair on the Job

Abstract: C ertainly, it would appear that being fair is a central interest among today's managers, concerned as they must be about providing "equal employment opportunities," adhering to "fair labor practices," and offering "a fair day's pay for a fair day's work." Just as judges promote fairness in the legal system, and referees and umpires ensure that sporting events are played fairly, managers are responsible for upholding both their company's and society's views of fairness by guaranteeing the fair treatment of employees.1 Despite this, however, it remains unclear what those responsible for the day-to-day management of organizations think constitutes fair behavior. Not surprisingly, just as legal scholars and philosophers cannot agree on what fairness really is in any absolute sense, social scientists have relied on studying justice as it is perceived to be that is, what is fair is in the eye of the beholder.2 In organizations, where the differing perspectives, interests, and goals of supervisors and subordinates might offer each access to different sources of information (as well as different biases on the same information), uncertainties about what is perceived to be fair are likely to arise.3 As a result, we may expect that seasoned managers trying to be fair may learn to focus on what others believe to be fair, thereby cultivating an impression of fairness rather than striving toward any abstract sense of morality. Indeed, when interviewing executives on the topic of organizational justice, I learned that in business organizations fairness was often a matter of impression-management. As one senior vice-president of a Fortune 500 firm confided in me, "What's fair is whatever the workers think is fair. My job is to convince them that what's good for the company is fair for them as individuals." Hearing this sentiment echoed by others, I began to suspect that fairness as viewed by corporate management was perhaps as much a matter of image as it was a matter of morality; that is, "looking fair" may be at least as important as actually "being fair." After all, even the best-intentioned, most "fair-minded" manager may fail to win the approval of subordinates who are not convinced of his or her fairness. Given this, we may ask the following two questions: (1) Are managers more concerned about looking fair or actually being fair? and (2) What do managers do to cultivate impressions of fairness? The Importance of Looking Fair: Survey Evidence

Women: World-Class Managers for Global Competition

Abstract: It is no secret that business faces an environment radically different from that of even a few years ago, the result of increasingly global competition. The Commerce Department estimated in 1984 that in U. S. domestic markets some 70% of firms faced "significant foreign competition," up from only 25% a decade previously. By 1987, the chairman of the Foreign Trade Council estimated the figure to be 80%. In 1984, U.S. exports to markets abroad accounted for 12.5% of the GNP; by comparison, Japan's 1984 exports were 16.5% of its GNP.1 Global competition is serious, it is pervasive, and it is here to stay. More stringent competition is an important result of this global economy. (See Exhibit 1.) Because markets are increasingly interconnected, "world-class standards" are quickly becoming the norm. New products developed in one market are soon visible in markets around the world, as initial producers use their advantage, forcing competitors to meet the challenge or lose market share. Product life-cycle has been reduced by 75%. Product development and worldwide marketing are becoming almost simultaneous. For example, recent developments in superconductivity, initially demonstrated in Zurich, were quickly replicated in The People's Republic of China, the United States, Japan, and in Europe. Similarly, U.S. automobile customers quickly learned to demand improved quality from U.S. automakers, once the Japanese autos had demonstrated it. Standards for price, performance, and quality have been permanently altered worldwide.

Restoring American Competitiveness: Looking for New Models of Organizations

Abstract: Every day brings new reports of lousy American product or service quality, vis-a-vis our foremost overseas competitors. The news of buyers rejecting our products pours in from Des Moines; Miami; Santa Clara County, California; Budapest; Zurich; and even Beijing. Industry after industry is under attack old manufacturers and new, as well as the great hope of the future, the service industry. Change on an unimagined scale is a must, and islands of good news those responding with alacrity are available for our inspection. But it is becoming increasingly clear that the response is not coming fast enough. For instance, even the near-freefall of the dollar does not seem to be enough to make our exports attractive or reduce our passion for others' imports. "Competitiveness is a microeconomic issue," the chairman of Toyota Motors stated recently. By and large, I agree. There are things that Washington, Bonn, Tokyo, Sacramento, Harrisburg, and Albany can do to help. But most of the answers lie within that is, within the heads and hearts of our own managers.

Cultural Consequences for Organization Change in a Southeast Asian State: Brunei

Abstract: In spite of the eureka-like cries of so many present-day writers on management and organization, the idea that organizationally speaking things get done differently in different cultures is not a new one. Ancient civilizations, like those of Greece and Rome, had more than a passing acquaintance with such differences; indeed, they appear to have spent much of their time trying to iron them out. The Pax Romana was as much about the imposition of standard forms of organization as it was about anything else the promise of peace and prosperity delivered via a uniform system of administration. Likewise in the modern world, the peripatetic organizational researcher will frequently come across the distinctive administrative footprints of more recent colonial powers. From the sands of the Sahara to the jungles of Borneo, clearly discernible amidst the crumbling ruins of older civilizations are the vestiges of British, Dutch, French, Portuguese, and Spanish colonial administrations. But with the passing of empires and the emergence of a large number of independent nation states, more subtle terms of trade have had to be developed. It has become necessary for multinational organizations and governments to take account of the wide variety of cultures and environments they encounter in their travels abroad. One of the most currently applauded attempts in recent times to identify cultural clusters of organizationally pertinent values has been that of Geert Hofstede, the Dutch researcher. In this well-known study, inferences about the value systems of 40 nations were drawn from a questionnaire survey of employees in a single multinational organization.1 (A subsequent study by Hofstede supplied data on an additional 10 countries.2) Differences in nations' values systems were explained most parsimoniously by four dimensions power, uncertainty avoidance, individualism, and masculinity/femininity. The results of these studies give a clue as to the kinds of things to expect in "close encounters" with organizations in the nations surveyed. But while such studies provide an admirable skeletal framework for researchers, managers might want more "flesh on the bones" to make the findings intelligible. Accordingly, the purpose of this paper is twofold: First, to propose further organizational examples of values that appear to be common to a subset of Southeast Asian nations by focusing on public organizations in the small, oil-rich nation state of Brunei. And second, to examine the potential impact of culture on the introduction of organizational change by comparing cultural impediments to change found elsewhere with dominant values in the region. A possible, though highly speculative, implication of this discussion is that certain cultures in Southeast Asia may be intrinsically more resistant to change than others. At the same time both the evidence offered and the discussion will furnish some kind of qualitative test of Hofstede's findings. Much of the discussion, however, will be suggestive and conjectural in nature rather than firmly grounded in empirical data.

Cultural Values and the CEO: Alluring Companions?

Abstract: One hundred fifty years ago, William Procter and James Gamble delivered their handmade candles and soap by wheelbarrow. Their emphasis even then on innovative marketing, competitive strategies, and uncompromised honesty are hallmarks of the multinational Procter & Gamble Company today. IBM's Tom Watson, Jr. believed in constructive rebellion, claiming, "You can make a wild duck tame, but you can't make a tame duck wild again." Today the wild duck is a symbol of IBM's unwavering respect for creative nonconformists that is, as long as they fly in the same direction. A founder of more recent vintage, Apple Computer's Steven Jobs is the quintessential rugged individualist whose fresh approach, willingness to take risks, and originality are evident in the company's name, as well as every product it makes. These descriptions illustrate how a founder's values permeate a corporation and affect its direction. When leadership changes, the new leader often carries on traditions while bringing along a new set of values that are also gradually integrated into the company's culture. An awareness of different companies' values can facilitate a firm in its business transactions and help stave off conflict. The abundance of such corporate raiders as T. Boone Pickens and Carl Icahn, and the impact raiders have had on Phillips Oil, TWA, CBS, Gulf Oil, and other companies' human resources, are clear evidence of a clash of values. The current emphasis on corporate culture both in academic journals and the popular press underscores the need for practicing managers to appreciate its influence. Yet little attention has been paid to the influence of national culture on corporations outside the United States. Viewing the world as "global village" requires that managers become more knowledgeable about international business yet many managers simply conduct international business as though they were dealing with fellow Americans. Culture shock, not to mention lost business, has often been the result. This article presents a framework for anticipating societal values that ultimately impact the behaviors of chief executive officers. Analyses of CEOs from five different cultures will illustrate how the framework can be used by managers involved in international business. Although biographies, stories, and legends about company founders are abundant, surprisingly little consideration has been given to the importance of the current CEO to the firm. What has been written usually focuses on CEO succession or demographic statistics. Clearly, other variables including personality characteristics, organizational design, environment, and business strategy influence CEO behavior, but it is our contention that value systems necessarily come first and may actually determine these other factors and govern their impact on the CEO. The potential for cultural differences among organizations is well known. The dominant values of a particular national culture are reflected in the constraints imposed on an organization by its environment (e.g., government, customers, and suppliers). In addition, the founders of an organization impose certain learned, cultural values on the organization from its beginning. Finally, organization members other than the founders behave in a manner consistent with the values of the "dominant elites" (the founders or current CEO). Culture and value systems are closely related. Individuals learn such values as respect for privacy or freedom of speech from their society. Although individuals differ in how they translate these values into action, in general we can begin to understand the behavior of CEOs by understanding the values their cultures hold dear.

Controlling Competitive Dynamics by Taking Strategic Initiative

Abstract: Today the popular press as well as the academic literature is replete with discussions of the increased turbulence of competition. The surviving competitors in the wake of this past decade's turbulent times are highly competent, aggressive, and possess significant resources. The implication for corporate strategy is that any competitive advantage currently held will eventually be eroded by the actions of these competent, resourceful opponents. It is no longer a question of whether the current competitive advantage will be eroded but rather a question of when. As a result, the challenge for today's strategist is to constantly seek the "second act" even as the firm is benefiting from the current competitive advantage it should be laying the groundwork for the upcoming competitive advantage. This challenge is best depicted by Exhibit 1. From the time the firm decides to make some strategic move to secure the initiative to the time that this initiative has been achieved and some type of competitive advantage has been created, is called the launch period. It is critical to minimize this period of time. The longer it takes to get an initiative in place, the more likely it is competitors will spot the move and the more time they will have to develop a counterinitiative. Furthermore, the launch period is a period of investment rather than revenue generation. So the longer it takes, the more we have to discount the revenue streams that result from having secured the initiative. In today's high cost capital markets, projects with long launch periods and high early outlays seldom return a positive net present value.

Value-Creating Mergers: Fact or Folklore?

Abstract: Since 1983, over 12,000 companies and corporate divisions worth about one-fifth of the market value of all traded stocks have changed hands. Investment bankers and corporate lawyers have prospered, and words such as "raiders," "greenmail," "white knights," and "golden parachutes" have been added to our vocabulary. This enrichment aside, however, are mergers good for much else? The consensus of the popular business press, which continues to focus on mergers that backfire, seems to be ''no." Almost every month a major article appears with a title such as "The Decade's Worst Mergers," and "Have Mergers Gone Too Far?" These articles love to recount the details surrounding problem-plagued mergers such as Exxon's $1.2 million blunder with Reliance Electric, Kennecott's mismanagement of Carborundum, or Coca-Cola's surprising setback with Taylor Wines.' The position of more than two dozen bills recently introduced in Washington to restrict merger activity is also "no." Proponents of these bills assert that the U.S. economy has suffered because mergers squander resources in the pursuit of illusory efficiency gains. Among the backers of these bills is Andrew C. Sigler, who is president of the Business Roundtable, an organization made up of the 200 largest corporations. Sigler charges that mergers are "nothing but a grubby asset play" that is "damaging the capability of the economic system to perform."2 Financial economists such as Professor Michael Jensen of Harvard and Richard Ruback of MIT represent a more tempered opinion. They maintain that selling firms' shareholders do benefit, but that the buying firms' shareholders do not. At best, they say, the "bidding-firm shareholders do not lose." In addition, they find mergers to be ineffective in reducing shareholder and business risks.3 These observations present a sobering picture of corporate decision makers. If on average mergers do not create value for the acquiring firms, why do managers continue to initiate them? Are managers oblivious to the legacy of those who have failed before them? Or are managers acting in their own interests because their rewards are more closely tied to corporate growth than to corporate value? The purpose of this article is to suggest a different view, one that comes from a growing body of literature that considers the strategy underlying mergers. This literature recently has produced three dissertations that earned national awards for excellence from the Academy of Management as well as a growing number of published articles on mergers.4 It presents findings that challenge the widely held beliefs concerning the value of mergers. We begin with a review of the theory of corporate diversification as it pertains to mergers. The potential benefits and practical impediments of related and unrelated mergers are discussed as background to this basic question: Can a firm create value for its shareholders through merger? We investigated the questions from the perspective of two conditions that are valuable to shareholders. One is when stock returns (appreciation plus dividend) increase as a result of merging, and the increase is in excess of the merging firm's cost of equity and general stock market movements; that is, when a merger causes abnormal returns. Evidence is presented from the strategic management literature that examines abnormal stock returns from the perspectives of selling and buying firms' shareholders. The second condition is when shareholder risk (cost of equity) declines as a result of a merger to a degree greater than that which could be realized through a securities manager's investment in both businesses. Shareholder risk is basically the variability in a firm's stock returns that is caused by the variability in the market's returns. Another name for shareholder risk, therefore, is systematic risk. We consider evidence on mergers and shareholder risk, and mergers and the full variability in a firm's stock returns that is, total risk. Finally, we offer practical suggestions for improving the effectiveness of mergers. The suggestions are particularly timely in light of the increased attention currently focused on shareholder value and the fact that many executives are unsure of exactly how their firm's actions affect stock price. For example, a Louis Harris and Associates, Inc. poll found that 60% of executives surveyed do not agree with the market's valuation of their company.5

Face Your Problem Subordinates Now

Abstract: A sk any manager the question, "Do you have problem subordinates?" and the reply is generally an emphatic "Yes!" ora more cynical "You must be kidding!" If there is one universal truth about managers, it is that all of them have problem subordinates. If there is a second truth, it is that the stories they have to tell about these subordinates often reflect a good deal of disparagement and despair. Here are a few typical tales of woe:

You Won't Recognize Me: Predictions About Changes in Top-Management Characteristics

Abstract: Everyone in today's business world is familiar with the pressures that result in reorganization, restructuring, decentralization, and attention to the near term. Recently, we have seen the fall of Richard J. Ferris, CEO of Allegis, allegedly because he attempted to build his organization for the long term. Psychological catastrophes that accompany these pressures are no longer news.' In addition, the concentration on cutting costs and attacking competitors frequently results in abandoning research and product development. The heavy emphasis on paying for the bottom line has all too often led to loss of innovation and depreciation of those qualitative features of an organization representing the core of its character. Yet the majority of CEOs remain heavily focused on the numbers, a pressure exacerbated by the threat of possible takeovers and the increasing demand of large stockholders, such as pension fund managers, for high returns in the short run. Search consultants report they continue to be asked to find prospective CEOs who will tightly control organizations for short-term results. Although these results often bolster stock prices, making the firm more attractive to institutional buyers, they start a spiral of escalating demands for "lean and mean" cultures. The phrase "lean and mean," taken from the world of professional sports, is now widely used. The implication in that phrase is that one should be willing to incapacitate the opponent whenever possible,2 and highlights the struggle for so many executives between being hard and soft, between being nonemotional and emotional, between being hard-nosed and a "bleeding heart." The fact of the matter is most business management has always been hard, in the sense of emphasis on measurement by the numbers and relative insensitivity to and inadequate understanding of psychological issues. So, the new model says, "Become harder in the face of stress. Tighten up." It is exactly that mode of defense which, when practiced by an individual under stress, can lead to ultimate burnout and breakdown. I have reservations about what is promising to become the "uptight" organization. The tighter the organization, the greater its rigidity and the harder for it to adapt flexibly to change. A tight organization implies significant control by its leadership and correspondingly less input from others, threatening the flow of information from those closest to the customer. An uptight organization is likely to be a driven organization. It is difficult to sustain the morale and commitment of people who are under unrelenting pressure. Physical and emotional exhaustion are likely to follow, with high turnover and loss of key personnel. Driven by bottomline pressures, more managers are likely to take only marginal risks with respect to environmental, legal, and financial regulations. These can have financial costs and reflect on the reputations of those organizations. There is considerable criticism of established hardnosed leadership. Roger B. Smith, chairman of General Motors, has such a difficult time with the critics that he has developed a psychosomatic skin rash.3 Thomas G. Wyman, who tried to bring better business management to CBS, seemed unable to deal with the mix of personalities in his organization. Harold Geneen of ITT, James Dutt of Beatrice Foods, and the late Charles Bludhorn of Gulf +Western have been criticized for their insensitivity to the feelings of employees and customers alike. That insensitivity is characteristic of all hard-nosed management. When costs have been cut to the bone and controls tightened into rigidity, the resulting insensitivity and lack of flexibility will inhibit competitive adaptation. That likely outcome leads me to predict that there will have to be a significant change in the personality characteristics of chief executives if their organizations are to be successful. That prospective requirement, however, will increase the sense of helplessness on the part of many top managers. In this article I will discuss both of those issues, the likely change, and the increase in the sense of helplessness.

Who Reaches for the Golden Handshake

Abstract: Downsizing. The word has a fearful ring, both to those whose jobs are in jeopardy and to those who must make the decision to push others out of the corporation. To soften the blow of workforce reductions, especially when they involve management employees, companies frequently offer a financial incentive or "golden handshake" to volunteers willing to terminate their employment ahead of schedule. This has been particularly effective for those nearing retirement, who can claim their pension and an additional payout. The golden handshake offer often takes the form of a bonus payment, which may be supplemented by a change in pension requirements, resulting in a larger pension. (For example, a company may give the employee credit for more years than he or she actually worked.) Observing the departure of managers reaching for such golden handshake offers, an executive may wonder, "What have I done? Have I lost my best managers?" At the same time, colleagues may wonder, "What will become of them? Will they regret it? Should I do the same thing?" Some answers to these questions come from a longitudinal study begun in the 1950s of Bell System managers. Participants in the study were followed intensively until the mid-1980s, by which time a significant number had taken an early retirement. Those who left with golden handshake offers were compared to other early retirees, and all who retired early were compared to an equivalent group who remained active on the company payroll. Also explored was whether it was possible to predict which managers were most likely to retire early. Data collected periodically over their managerial careers reveal that the retirees differed from the actives in terms of their work motivations and attitudes, their financial concerns, and their values and interests. A final consideration is the reactions of the early retirees to the circumstances of their departures and to their lives in retirement. These various analyses have led to recommendations for companies' using golden handshake offers.

Managers' Careers and Organizational Change

Abstract: It can be said that career patterns often reflect an organization's human resource solutions to critical business problems a reflection of business strategy and organizational culture as well as a resource for creating new strategy. Organizations grow and perpetuate themselves not only because of their products, but also because of their people. The large organization generally creates career patterns through which people move, become committed to the organization, and become capable of managing larger parts of the business. What happens when organizations go through a significant change? Are existing career patterns able to produce an appropriate new mix of executives, or do career patterns inhibit large-scale transformation? In this article we examine managerial career patterns and the way in which they can be structured to facilitate organizational adaptation and change. Specifically, we argue that managerial careers ought to have logical, linear, rational, planned characteristics as well as opportunistic, incremental characteristics. Consider the following experiences of two organizations one private and the other military. A large manufacturing firm recently began hiring middleand upper-level managers and specialists to help the company regain its competitive position in its markets. By itself this was not a particularly noteworthy event. However, this firm had never hired for any but entry-level positions in the past, had always developed and promoted its own top management from within, and had elaborate, stable career patterns and management training programs that were regarded as the industry standard. Why, then, did it begin hiring experienced managers from other firms? Historically, this company had been quite dominant in its markets. Driven by a stable manufacturing technology, its product lines were highly profitable, and product marketing was almost nonexistent. The company was reputed to be a safe, secure employer, almost never firing employees. Then a series of unforeseen changes shook this firm out of its complacency. Government regulations changed, opening the way for more competition. Foreign-based manufacturers began producing the same product at much lower cost, and competitors undertook technological developments that threatened the firm's preeminence. These changes caused top management to pursue a process of transformation in which marketing and new product development were to become the driving force. To implement these changes, middleand seniorlevel managers were hired from outside. These people were to run the complacent businesses more aggressively, with a sharp eye on costs. The effect, of course, was to displace managers who for years had been nurtured through the management development process. Marketing talent was also hired to help recapture market share. Older employees, long since plateaued, were invited to retire early, while those who did not retire were downgraded as a way to cut costs. The results? Market share has continued to decline, new product development is lagging, and morale among lower and middle managers is down as career opportunities have been truncated by the new practice of outside hiring. The firm also discovered that a significant marketing presence cannot be created overnight, especially in a culture that was dominated so strongly by manufacturing. As a result, high talent MBAs in marketing were hired but not used effectively, and high turnover among this group resulted. Finally, the middleand senior-level managers brought in to run the businesses have not experienced much success, so the legitimacy of this tactic is in doubt. Top management now talks about promotion from within, and slower mobility through the ranks so the next generation of general managers will know the businesses before being asked to run them. During World War 11 the Allies were in need of a Commander-in-Chief with skills rather different from those of the typical general. In his book, The Professional Soldier, Morris Janowitz recounts Dwight Eisenhower's military career as a counterexample to typical military promotion patterns.' Eisenhower was probably best classified as a staff specialist. He had relatively little command experience, the norm for executive careers in the military. However, he had experience dating from the 1920s and 1930s as a negotiator and interpreter between the military and the War Policies Commission, which was a long-range planning group consisting of cabinet secretaries and members of Congress. In this job he interpreted the military's point of view to the politicians, and vice versa. He went on to staff assignments for General MacArthur in which his ability to handle politically sensitive assignments further contributed to his success.

Management in the 1990s: The International Challenge

Abstract: As we approach the 1990s, it is becoming increasingly clear that the United States has lost its competitive edge in international business competition. Signs of this can be seen in many places. Last year, for example, the United States had a trade deficit of $166 billion, making it the world's largest debtor nation, far surpassing such nations as Brazil, Mexico, and Argentina. Each year, we own less and less of our own economy. As American firms decline, companies in other nations often prosper. Consider the case of Japan. Toyota and Nissan are now the thirdand fourth-largest auto companies after General Motors and Ford, and they continue to gain market share each year. Nippon Steel is now larger than U.S. Steel or what is now USX and Hitachi and Matsushita are second and third after General Electric in consumer electronics. NTT is emerging as AT&T's principal competitor in the telecommunications industry, and IBM's only serious rivals in the mainframe computer industry are Fujitsu and NEC. However, the problem goes further than Japan. Consider the case of Korea. One of the largest and most modern steel mills in the world is Pohang Steel near Ulsan in South Korea. Hyundai Heavy Industries can build a supertanker to unique specifications in ten months, while the same project in the United States or Western Europe would take almost three years. Korea was the third nation (after the United States and Japan) to build the 256K D-Ram chip. Japan's principal competitors for the American and European consumer electronics markets are such Korean companies as Goldstar, Daewoo, and Samsung. And the car with the most successful sales record ever for a new entry in both the United States and Canada is made in Korea by Hyundai. Other examples from other countries could be cited. France's Thompson Group recently purchased GE's major television production capacity in the United States, while Italy's Olivetti and the Dutch-owned Phillips continue to make inroads in the American electronics market. However we look at it, we are facing a global economy and, as a result, our industrial competitiveness has come to rely increasingly on our ability to compete successfully with these rivals. The fact that we often do not win these competitions represents a challenge to both management and teachers of management. If the United States and other nations are to develop into successful world competitors, it is imperative that greater efforts are invested in developing the managers of tomorrow who understand global economics and political dynamics and can act accordingly. Among U.S. multinationals there is a need for managers who are mobile and adaptable, can deal effectively with a wide variety of people, and feel at ease and knowledgeable in different cultures of the world. If they fail to select and develop managers who possess these skills and abilities, countries like the United States run the very real risk of becoming what might be termed a "newly de-industrialized country" (in contrast to a newly industrialized country, or NIC). To avoid such a possibility, managers and teachers of management have a collective responsibility to examine all possible avenues for improving overall organization effectiveness. Education is one of the most promising avenues for meeting the challenge confronting American business, and U.S. business schools have the responsibility to provide the very best education for those students preparing for a career in business. An international perspective is now an essential element of the business curriculum, and students must be exposed to the international dimension of business throughout their academic program. ,vO. 11