Articles

Integrating design and manufacturing helps, but only if the fit is right.

All corporations engaged in multiple lines of business face a paramount strategic imperative imposed by the stock market: Maximizing the profitable growth that is possible from their constituent businesses. Meeting this imperative over the long term requires such corporations to develop new strategy-making capabilities. So how can company leaders identify and exploit the opportunities that take the fullest advantage of their companies' capabilities and potential to pursue new strategies? In their attempts to meet the stock market's imperative, multibusiness companies in the past have pursued operational efficiencies by integrating business activities and have extended their existing strategies by combining resources from various business units. But that is not enough, say Robert A. Burgelman, professor of management at Stanford University, and Yves L. Doz, professor of global technology and innovation at INSEAD. Multibusiness corporations need to develop a capability for what the authors call complex strategic integration, which involves the discovery and creation of new business opportunities by combining resources from multiple units within the firm -- each with its own perspective and vested interests -- in order to extend the corporate strategy in new directions. Only a few multibusiness companies are currently trying to develop a CSI capability. But the challenges and imperatives for all companies are the same. Company leaders need to manage the evolving tension between reinforcing the company's core business and redirecting strategy in new directions, as well as the sharing and transferring of resources. They also must ensure that senior executives develop the political and entrepreneurial skills necessary to effectively pursue CSI initiatives, along with the ability to conceive of these new strategies. Above all, company leaders have to create a corporate context that facilitates CSI as an ongoing institutionalized process rather than as an infrequent occurrence that depends on the ad hoc championing efforts of some highly dedicated senior managers. That includes developing the appropriate organizational structures, control systems and incentives.

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New research confirms that workers everywhere have the same needs.

Managers don't need to be told that globalization is accelerating, that new technologies are proliferating or that change is the only constant. Nor do they need anyone to point out how difficult it is for organizations to keep adapting to all the change. They have lived that story. What they may not realize, however, is the extent to which they may be the stumbling blocks to their organizations' transformation and growth. That is because the personal assumptions that undermine their decision making are often quite unconscious. Recent research shows that despite the genuineness and dedication of executives' attempts to manage change, "social projection," or the "false-consensus effect," keeps getting in the way. Projection involves making intuitive judgments about other people and places on the basis of one's own beliefs, knowledge and experience rather than on anything objective about the particular people or places. It leads to overestimating consensus, undervaluing objective assessments or different views, turning away constructive feedback and taking on new ventures without reaching consensus -- a dangerous scenario. Authors Robert L. Cross, a lecturer in the organizational behavior department at Boston University and a research fellow at IBM's Institute for Knowledge Management in Cambridge, Massachusetts, and Susan E. Brodt, a professor of management at Duke University's Fuqua School of Business, use industry examples to support their concrete advice on how to tackle the detrimental effects of projection. They suggest techniques such as creating and maintaining an individual's awareness of projection, practicing looking at ideas from a different perspective, encouraging conflict, and disentangling self-worth from consensus. Because well-honed intuitive judgment is an executive necessity, no manager should let it fall prey to projection. After managers have learned to identify that invisible barrier, they can gain insight into the workings of their own minds and make sense of others' actions. Having done so, they will be able to move ahead in implementing change while managing organizations that can excel in the global arena.

Integrating design and manufacturing helps, but only if the & #x0201C;fit” is right.