Showing papers in "Academy of Management Executive in 1989"

Organizational Frame Bending: Principles for Managing Reorientation

Abstract: O ne of the hallmarks of American business in the past decade has been the attempts by large organizations to manage large-scale planned change. In some cases — AT&T, Chrysler, and Apple, for example — the efforts have been dramatic and have captured public attention. Other cases, such as Corning Glass, Xerox, Citicorp, and GTE, have received less attention, but the changes have been no less profound. The concept of planned organizational change is not new; but this most recent generation of changes is somewhat different from what has gone before. First, they typically are initiated by the leaders of organizations rather than consultants or human resource specialists (although they have played significant roles in some cases). Second, they are closely linked to strategic business issues, not just questions of organizational process or style. Third, most of the changes can be traced direaly to external factors, such as new sources of competition, new technology, deregulation or legal initiatives, maturation of product sets, changes in ownership, or shifts in fundamental market struaure. Fourth,these changes affect the entire organization (whether it be a corporation or a business unit) rather than individual SBUs (strategic business units) or departments. Fifth, they are profound for the organization and its members because they usually influence organizational values regarding employees, customers, competition, or products. As a result of the past decade's changes, there are now more large visible examples than ever before of successful planned organizational change.

Leadership: The Art of Empowering Others

Abstract: I n his handbook, The Prince, Machiavelli assures his readers some being aspiring leaders, no doubt that only by carefully amassing power and building a fearsome respect could one become a great leader. While the shadowy court life of 16th-century Italy demanded such treachery to ensure one's power, it seems hard to imagine Machiavelli's advice today as anything but a historical curiosity. Yet, interestingly, much of the management literature has focused on the strategies and tactics that managers can use to increase their own power and influence.' As such, a Machiavellian quality often pervades the literature, encouraging managers to ensure that their power base is strong and growing. At the same time a small but increasing number of management theorists have begun to explore the idea that organizational effectiveness also depends on the sharing of power that the distribution of power is more important than the hoarding of power.2 While the idea of making others feel more powerful contradicts the stereotype of the all-powerful executive, research suggests that the traditional ways of explaining a leader's influence may not be entirely correct. For example, recent leadership studies argue that the practice of empowering or instilling a sense of power is at the root of organizational effectiveness, especially during times of transition and transformation.3 In addition, studies of power and control within organizations indicate that the more productive forms of organizational power increase with superiors' sharing of power and responsibility with subordinates.4 And while there is an increasing awareness of this need for more empowering leadership, we have only recently started to see documentation about the actual practices that leaders employ to effectively build a sense of power among organizational members as well as the contexts most suited for empowerment practices.5 In this article, I will explore these practices further by drawing upon a recent study of senior executives who proved themselves highly effective leaders. They were selected by a panel of professors at the Harvard Business School and management consultants who were well acquainted with them and their companies. The study included eight chief executive officers and executive vice-presidents of Fortune 500 companies and successful entrepreneurial firms, representing industries as diverse as telecommunications, office automation, retail banking, beverages, packaged foods, and managementconsulting. In each case, these individuals were responsible for either the creation of highly successful companies or for performing what were described as remarkable turnarounds. During my study of these executives, I conducted extensive interviews, observed them on the job, read company and other documents, and talked with their colleagues and subordinates. While the study focused on the broader issue of leadership styles, intensive interviews with these executives and their subordinates revealed that many were characterized as empowering leaders. Their actions were perceived as building confidence and restoring a sense of personal power and self-efficacy during difficult organizational transitions. From this study, I identified certain organizational contexts of powerlessness and management practices derived to remedy them. In this article I will also illustrate several of these practices through a series of vignettes. While the reader may recognize some of the basic ideas behind these practices (such as providing greater opportunities for initiative), it is often the creative manner in which the leader deploys the particular practice that distinguishes them. The reader will discover how they have been carefully tailored to fit the context at hand. I might add, however, that these practices represent just a few of the broad repertoire of actions that leaders can take to make an empowering difference in their organizations.

Strategy Implementation as Substance and Selling

Abstract: Today's strategists are at no loss for concepts and techniques to help them formulate strategies. Over the past 15 years, consultants and academic researchers have introduced a variety of powerful and pragmatic tools for answering the question, "Where and how should we compete?" Tools such as industry and competitor analysis, portfolio models, product life-cycle theory, and internal strength and weakness analysis have gained widespread use.1 Many executives now express satisfaction with the methods used to derive their business strategies. But many of these "best-laid plans" are failing to see the light of day. Plans to innovate fizzle out after a series of task-force meetings; plans to improve quality get no farther than some airy rhetoric and the hiring of a "quality guru"; and plans to become the low-cost producer bog down when corporate officers balk at expensive outlays for plant modernization. In short, many of our strategies simply aren't happening. Without successful implementation, a strategy is but a fantasy. This problem how to convert a new strategy into concrete competitive success is what managers now need frameworks for, and is the focus of our article. Actually, the widespread inability to implement strategy may be a sign that accepted approaches to strategy formulation are not as good as many think they are, for a well-conceived strategy is one that is implementable. For that reason, implementation must be considered during the formulation process, not later, when it may be too late. A tendency to treat formulation and implementation as two separate phases is at the root of many failed strategies.2 Regrettably, the recent trend among consultants and business schools to treat strategy formulation as being primarily based on industry and product/market economics exacerbates the schism. The strategist will not be able to nail down every action step when the strategy is first crafted nor, as we will later argue, should this even be attempted. However, he or she must have the ability to look ahead at the major implementation obstacles and ask, "Is this strategy workable? Can I make it happen?" If an honest assessment yields "no" or "only at an unacceptable risk," then the formulation process must continue. A great strategy is only great if it can actually be carried out. Thus, the guidelines we offer in this article about implementation must be in the mindset of the strategist even at the earliest formulation stages. Our ideas about strategy implementation have evolved on the basis of situations we have observed in numerous firms, as well as a long and careful reading of the literature on the topic.3 However, our thoughts have been crystallized and clarified particularly by a recent opportunity to study several successful and unsuccessful implementations of business strategies in a large multibusiness firm. The top management of this company, which we will call Globus, had concluded that the major difference between competitive success and failure for its business units lay more in matters of strategy implementation than formulation, and they sought to understand the common ingredients of their own most effective business strategy implementations. At Globus, we had an opportunity to examine a broad range of plans for strategic change for achieving low cost position, going global, consolidating, and others. Here, we will draw on one of the businesses we studied the Bondall Division to illustrate the very persuasive, recurring themes we observed. Succinctly put, and portrayed in Exhibit 1, these were the patterns of behavior for the effective strategy implementers at Bondall and the other units we studied: 1. Obtain broad-based inputs and participation at the formulation stage. 2. Carefully and deliberately assess the obstacles to implementation. 3. Make early, first-cut moves across the full array of implementation levers resource commitments, subunit policies and programs, structure, people, and rewards. 4. Sell, sell, sell the strategy to everyone who matters upward, downward, across, and outward. 5. Steadily fine tune, adjust, and respond as events and trends arise.

The Role of the Manager: What's Really Important in Different Management Jobs

Abstract: This article presents a study on the differences in management roles and activities across different levels and functions within an organization. The study asked more than a thousand managers to rate the relative importance of a number of managerial tasks to their jobs. It identified seven major factors or groups of management tasks. It confirmed that there are differences in the importance of managerial tasks across marketing, manufacturing and administrative functions. The study also revealed that the similarities of managerial tasks are greater than the differences. The practical implication of this finding is that a common approach to selecting, training and developing managers may developed within an organization.

Irrelevance, Intransigence, and Business Professors

Abstract: T he professor quoted above was explaining his lack of interest in relevant research on real-world business problems. Not three months later, the relevance of business education to the business world was the concern of a brouhaha that erupted at the Yale School of Organization and Management. Its new dean had decided to dismiss six untenured faculty members who taught organizational behavior, to eliminate the doctoral program in that area, and to transfer valued courses in production management and data analysis to a nonbusiness curriculum. A fire storm of criticism arose over what many saw as the destruction of the school's unique and useful emphasis on interpersonal skills in business.2 These are just recent examples of the continuing criticism leveled at collegiate business education and research. Many consider business scholarship irrelevant and deliberately recondite; books and articles complain that business executives and business professors have little in common and communicate infrequently. Although authors have proposed inventive schemes to unite these estranged parties,3 little evidence of reconciliation exists. In fact, cooperation between the two groups has been so unusual that their collaboration at Duke University made national newspaper headlines.4 The situation begs a question: If the rift between top managers and business professors is so wide, and if prominent critics have proposed ideas for solving the problem, why has so little change occurred? Strangely, even some academic writers seem oblivious to the query. In one of the most widely read articles on the subject, J. N. Behrman and R. 1. Levin5 complained that business schools simply were not doing their jobs. The authors suggested that schools change their pedagogical goals, implement new organizational and reward systems for business schools, and appoint deans capable of exerting extraordinary leadership. Scant attention was paid to the fact that there just are not enough extraordinary leaders to go around and that existing goals and systems remain in place because they work for many academicians. The lack of attention to the sources of academic intransigence turns potentially good ideas into emotional rhetoric that produces little action. Our purpose in this article is to explain the obscure but powerful roots of such intransigence, to suggest that the rift between managers and academicians will continue, and to make inferences about the future consequences of this rift.

An Anatomy of Autonomy: Managing Professionals

Abstract: The most vexing problem in the management of salaried professionals is how to provide them with their espoused right of autonomy while ensuring adequate control of the organization. In this article, Joseph Raelin explains how a standard approach of granting professionals operational autonomy (autonomy over the means or procedures to be used) while according management administrative and strategic autonomy (autonomy over the activities of the organizational unit or over the missions of the entire enterprise) is a convenient norm for executives to adopt in most situations. However, he goes on to illustrate how to manage the critical exceptions: those conditions when professionals out to be granted administrative and strategic autonomy as well as those conditions when management may actually invade the operational autonomy of the professional.

The Making of the British CEO: Childhood, Work Experience, Personality, and Management Style

Abstract: The purpose of the research described here was to find out more about the personality, background, and characteristics of successful managers. We were particularly interested in managers' psychological attributes and developmental influences, rather than in the roles they play and how they spend their time, which has been the focus of so many other studies; we wanted to know more about what they were like as people. Any discussion of successful managers inevitably raises the question of defining "success." We have avoided this issue by defining a successful manager as one who reaches the top of a major organization. Therefore, the conclusions outlined here are based on interviews with 45 chief executives of British companies with over 1,000 employees and a successful financial record. The interviews were semistructu red and explored such aspects of the executives' lives as family background and childhood, education, career pattern, motivation, and personality.

Gaining Strategic and Organizational Capability in a Turbulent Business Environment

Abstract: Being an executive in the late 1980s and the 1990s will be like playing basketball with a moving basket. With increasing rates of environmental changes as well as the diversified nature of most large firms, continuity and durability of organizational strategy no longer guarantee success. Drafting 5or 10-year strategic plans becomes an exercise in futility when the organizational environment changes so dramatically that long-term plans fail to adjust for transient targets. To compete in this and the next decade of transformation requires that executives create and maintain organizational assumptions and practices that help clarify and cope with continual environmental change. This article proposes executive actions that can increase strategic and organizational capability in turbulent times.

Changing Unethical Organizational Behavior

Abstract: W A / hat are the implications of Hamlet's question in the context of organizational ethics? What does it mean to be ethical in an organizational context? Should one suffer the slings and arrows of unethical organizational behavior? Should one try to take arms against unethical behaviors and by opposing, end them? The consequences of addressing organizational ethics issues can be unpleasant. One can be punished or fired; one's career can suffer, or one can be disliked, considered an outsider. It may take courage to oppose unethical and lead ethical organizational behavior. How can one address organizational ethics issues? Paul Tillich, in his book The Courage to Be, recognized, as Hamlet did, that dire consequences can result from standing up to and opposing unethical behavior. Tillich identified two approaches: being as an individual and being as a part of a group.' In an organizational context, these two approaches can be interpreted as follows: (1) Being as an individual can mean intervening to end unethical organizational behaviors by working against others and the organizations performing the unethical behaviors; and (2) being as a part can mean leading an ethical organizational change by working with others and the organization. These approaches are not mutually exclusive; rather, depending on the individual, the organization, the relationships, and the situation, one or both of these approaches may be appropriate for addressing ethical issues. Being as an Individual

Identifying and Closing the Gap in the Middle of Organizations

Abstract: C omplexity has become a way of life for many U.S. organizations: Deregulation has blurred traditional market boundaries, international firms have successfully invaded U.S. markets, and new competitive and financial pressures have forced companies to make changes in what previously had been considered sound operating methods. When these developments were first occurring, many senior managers recognized that they could no longer effectively make all major decisions they were simply too far from the action. They saw that the traditional, vertical organizational structure was becoming paralyzed as a result of too many decisions being passed up the line. To increase the effectiveness of their organizations, many decided to shift the power to make decisions regarding everyday operations to middle-level people, who were closer to operations and to the customer. This decision to decentralize, which was popularized by Tom Peters and Bob Waterman, is based on the principle that involvement, participation, empowerment and ownership motivate people. Consequently, top managers expect that middle-level individuals would rise to the occasion and enthusiastically take on their new responsibilities. As we evaluate this effort today, however, we can see that attempts in many organizations to improve organizational effectiveness by giving more responsibility to people at middle levels are not working. Vertical channels are still clogged, decisions are not being made any faster, and foreign competitors are still able to introduce new products faster than U.S. firms can. Frustration is mounting at the top of the organization and in the middle. A senior manager made these observations about his three-year effort to delegate decision making:

GE's Crotonville: A Staging Ground for Corporate Revolution

Abstract: Dadically altering the genetic code of a large, successful corporation requires revolutionary action. Since 1981 John F. Welch, CEO of General Electric, has been struggling to break the company's old genetic code. This code was built around a core set of principles based on growth in sales greater than GNP, with many SBUs (strategic business units), relying on financial savvy, meticulous staff work, and a domestically focused company. The new genetic code is to build shareholder value in a slow-growth environment through operating competitive advantage with transformational leadership at all levels of the organization. After five years of this effort -which included downsizing GE by over 100,000 employees, divesting $6 billion and acquiring $13 billion in businesses (RCA being the largest), doubling investment in plant equipment and RD that is, creatively destroy and remake an organization around new visions, supported by revamping the social architecture of the organization. This is needed at all levels of GE and is a continuous process.

MBO as a Complement to Effective Leadership

Abstract: M ike Gantz knew he was in trouble. After only two years as vice-president of marketing and sales at Acme Products, his boss had just suggested he resign. Actually, Gantz had seen it coming. He had to admit he'd let Acme down by his inability to get things done the way he had in his previous job. But he still couldn't understand where he'd gone wrong. Prior to coming to Acme, Gantz had earned an excellent reputation as the best division sales manager in a large, diversified industrial firm. He credited much of his success to his highly participative management style. In implementing Management by Objectives (MBO), for example, he had actively involved his subordinates in goal setting and then granted them considerable latitude in meeting their goals. This approach had produced a highly motivated and productive team of subordinates. In fact, Gantz had been recruited to work the same magic at Acme Products, one of his former division's competitors. Unfortunately, the results of his considerable efforts had been very disappointing so far. After two years of his leadership, Acme had lost almost as much market share as top management had expected him to gain, customer dissatisfaction was at an all-time high, and turnover of salespeople had nearly tripled. As far as Acme Products was concerned, Gantz was a disaster and had to go! How could a manager with a proven record fail so badly? Could he have been the victim of the "Peter Principle" and found his level of incompetence? Maybe. But we believe that Mike Gantz's failure came about in large measure from his failure to diagnose the situation and adopt leader behaviors and MBO practices that were compatible with each other as well as appropriate to his new and different situation. Most of the managers reporting to him at Acme did not have the abilities or initiative of his previous subordinates. Nor did the new firm possess most of the well developed support systems to which Gantz had grown accustomed in his previous job. The new organization's culture was very different as well. While extensive participation and trust had been the norm at his previous firm, his new subordinates were used to being told exactly what to do and then having the boss follow up closely to make sure they were actually doing it right. Small wonder that Gantz's participative and permissive style frustrated his new subordinates and resulted in confusion rather than goal attainment. Gantz should have recognized the difference in the capabilities and expectations of his new subordinates and made himself available to be a supportive resource and coach, with more directive and decisive behavior. While the names have been changed to protect the guilty, the above scenario is all too real. It illustrates a very common problem: a failure to achieve a suitable match between leader behavior, MBO implementation, and the organizational situation. It is this very important match that we will consider in this article.

The Hidden Influences of Office Design

Abstract: A good deal of attention has been directed at the suggestion that office design including the arrangement of offices, furnishings, and physical objects present in the work setting influences job performance, job attitudes, and impressions. With almost 40 million people currently working in 9 billion square feet of office space in the United States,1 even relatively small influences of office design on performance, attitudes, and impressions could have a large impact on productivity levels and employee attitudes. Many managers are unaware of the relationship between office design and various organizational behaviors, attitudes, and impressions. In this paper, I will (1) identify and describe the ways various elements of office design influence attitudes and behaviors, (2) identify and describe symbolic messages conveyed by office design, and (3) elaborate on actions managers can take that may result in more efficient and effective work environments.

Just-In-Time Management: A Critical Assessment

Abstract: The Japanese import known as JIT, or Just-In-Time Management, has been receiving a great amount of attention recently. Although no one has published any figures on exactly how many companies are currently using or plan to use JIT, a review of the business periodicals index reveals that a total of 168 articles were published on the topic of JIT in the past two years (1987 and 1988). In addition, many of the Fortune 500 companies, such as Exxon, General Motors, Ford Motors, General Electric, Black & Decker, Xerox, Hewlett-Packard, and Steelcase have adopted some form of JIT. Each new article on the subject continues to promote JIT as a panacea for management and scheduling problems. However, they usually fail to elaborate on the problems and weaknesses inherent within J IT an omission that may lead practicing managers and entrepreneurs to believe that it is the solution to all their problems. In the majority of cases, this is simply not true. In fact, JIT probably creates more problems than it solves, especially when it is inappropriately applied. In this article, I will attempt to uncover and elucidate the shortcomings of JIT by exposing its major weaknesses. However, my intent here is not to discredit or downplay the benefits of JIT it has been credited with large increases in quality, and decreases in production time, capital expenditures, and inventory costs.' Instead, my aim is to inform and educate practitioners about potential obstacles that may be encountered in implementing this system. The need for such a paper was highlighted by a recent survey conducted by Price Waterhouse, which found that most manufacturing executives do not understand JIT, even though their companies use it.2 I will begin this article with a brief introduction to JIT and outline its major benefits. Then, I will discuss several areas where problems may arise, using Porter's five forces model of competition, as well as other problem areas. Lastly, I will suggest ways managers can determine and evaluate the appropriateness of JIT for a given situation.

Creating Competitive Advantage: Welding Imagination to Experience

Abstract: Good afternoon, and thank you both for the introduction and for the invitation to be with you here today. The ideas that I want to talk about emerged as a result of a traumatic experience our organization went through in the early 1980s. Our company was acquired in a wildly overleveraged buyout on the eve of the worst business downturn since the Great Depression. Almost overnight we went from being a moderately well-run, growth organization to an insolvent wreck.1 We were thrown from Order into Chaos, and in the months that followed we were forced to reexamine every aspect of our business operations. The crisis was so great that we were compelled to articulate and reconsider everything we believed about the nature of people and the role of business organizations. In short, we were compelled to make explicit our own personal and organizational philosophies. It is a process that continues in our organization today. I have since come to believe that this reaction is the natural response of both individuals and organizations when faced by crisis. It is essentially what happened in the wellknown Tylenol-tampering incident, when the managers at Johnson and Johnson, faced with a problem falling well outside their standard operating procedures, were forced to fall back on their credo their statement of their most fundamental values in their search for a guide as to what action they should take.