Articles

During the past thirty years, Japan has developed global preeminence in many technologies used for both military and commercial applications, without making significant investments dedicated to the military economy. The United States, by contrast, has pursued guns and butter simultaneously by directing public expenditures toward military goals. As a result, its defense establishment became the largest single source of R&;D funding in the world. Despite this massive effort directed toward military ends, the relative strength of the U.S. technical base has declined. The author, in a forthcoming book, examines how Japan's concept of national security developed to encompass technological strength and how its institutions support that concept. This excerpt looks in detail at the pathways along which technology is diffused within and across Japanese industries. Excerpted primarily from chapter 8 of "Rich Nation, Strong Army": National Security and the Technological Transformation of Japan, copyright (c) 1994 by Cornell University. Used by permission of the publisher, Cornell University Press.

What is corporate transformation and how can we define a successful one? The authors propose a definition based on behavioral changes throughout the organization and suggest a framework, built on their analysis of cases and interviews, for comparing transformations among firms.

How the partners in an alliance view their joint venture can have much to do with its success or failure. Do they fear that the other partner will get a larger payoff, while they operate in good faith? Or do they make seemingly counterintuitive unilateral commitments that involve acts of faith by one or both companies? Here the authors present a framework, derived from field interviews and viewed in game theory terms, for securing partners' cooperation, managing an alliance, and ensuring its success.

The case manager role represents a break with the conventional approach to the division of work. Individuals or small teams perform a series of tasks, such as the fulfillment of an order, from beginning to end, often with the help of information systems that reach through the organization. Case managers provide a way to increase organizational efficiency, timeliness, and customer satisfaction. The authors discuss some of the issues arising from case management and the lessons we can learn from the experiences of some pioneering firms.

The role of IT in shaping tomorrow's business operations is a distinctive one. IT has become a fundamental enabler in creating and maintaining a flexible business network. Using a framework that break IT-enabled business transformation into five levels, the author describes each level's characteristics and offers guidelines for delivering maximal benefits. He suggests that each organization first determine the level at which benefits are in line with the costs or efforts of the needed changes and then proceed to higher levels as the demands of competition and the need to deliver greater value to the customer increases.

In a global economy, managers constantly negotiate with people from other cultures, whether the issue is coordinating operations within a multinational firm, arranging a joint venture, or convincing a foreign government to approve construction of a plant. Yet managers have had to rely on simplistic formulas -- following lists of "dos and don'ts" -- or very demanding ones -- "doing as the Romans do" -- to deal with the cultural aspects of these negotiations. Actually, a number of strategies are available. The author presents these strategies in a framework based on the parties' level of familiarity with each other's cultures and the extent to which they can explicitly coordinate their strategies. These factors determine the subset of strategies that are realistically feasible for an individual manager. Part 2 of this article, which describes a methodology for choosing among these strategies, appeared in the Spring 1994 issue.

Which model for the labor-intensive production of standardized products -- the Japanese production model represented by NUMMI or the holistic alternative represented by Uddevalla -- is really the best organizational design to support learning? The author revisits Paul Adler and Robert Cole's article from the Spring 1993 issue of Sloan Management Review and presents his own side of the debate. Adler and Cole's rejoinder appears at the end of the article.

Organizational performance is increasingly tied to intangible assets such as corporate culture, customer relationships, and brand equity. Yet controllers, who monitor and track firm performance, traditionally concentrate on tangible, balance-sheet assets such as cash, plants and equipment, and inventory. The authors argue that controllers can have an important role in tracking and analyzing off-balance-sheet resources. Here they envision this new role and its place in the organization.

Corporate banks are ideally suited for the new financial environment in which trade barriers will fall and national financial markets will open to capital transfers, borrowing, and investment. The author discusses the history of corporate banks, their structure, their functions, their links with subsidiaries, performance assessment, and the benefits and risks of setting up a corporate bank.

Firms in many industries are being squeezed by customer demands for both greater product variety and reduced delivery lead times. This is difficult for firms to achieve because quick delivery is usually based on standardization, whereas product variety requires the organization to be flexible and innovative. A common response to these demands is to start production of expensive, specialized products prior to receiving specific orders for them. Such a risky approach often can be avoided, the authors argue. They present a framework for determining the extent of your company's "customization-responsiveness squeeze" and choosing appropriate tactics to mitigate it.