Articles

Good decision making required more than knowledge of facts, concepts, and relationships. It also requires metaknowledge -- an understanding of the limits of our knowledge. Unfortunately, we tend to have a deeply rooted overconfidence in our beliefs and judgments. Because metaknowledge is not recognized or rewarded in practice, nor instilled during formal education, overconfidence has remained a hidden flaw in managerial decision making. This paper examines the costs, causes, and remedies for overconfidence. It also acknowledges that, although overconfidence distorts decision making, it can serve a purpose during decision implementation.

Many articles exhort service firm managers to empower workers and first-line supervisors, exploit technology, focus on the customer, and, above all, provide outstanding service. This article proposes a framework to help you evaluate your company's competitive standing in each of these areas. It discusses four types of companies on a continuum, from the company that is simply "available for service" to the firm that delivers world class service. The authors focus on operations, the function that controls the service encounter, and apply the manufacturing strategy paradigm to services as a means of implementing change.

It's a marketer's dream -- the ability to develop interactive relationships with individual customers. Technology, in the form of the database, is making this dream a reality. Now companies can keep track of customer preferences and tailor advertising and promotions to those needs. For instance, a grocery store system could note that you recently purchased a sample size of dishwashing detergent and could offer you a coupon to buy the large size. Blattberg and Deighton explore the impact of this development on marketing practice and give practical advice on designing a marketing database and staffing an interactive marketing department. They also address customer fears and the public debate over marketing and privacy.

How well do upper-level managers manage their own managers? Not very well, argue Longenecker and Gioia, after interviewing 261 managers in eighteen organizations. These people felt they needed more guidance, clearer feedback, more carefully established goals, more discussion of their management styles, and more useful performance appraisals, among other things. At a time when many companies are eliminating whole layers of management, and careers are derailed for mediocre performance, managers are understandably anxious about how to improve their performance, and whether anyone's noticing when they do. The authors describe ten myths of managing managers and provide senior managers with a list of ten recommendations for changing their behavior and, ultimately, improving their organization's overall performance.

It has long been a marketing axiom that customers buy bundles of satisfaction, not products. It follows, then, that they'll respond to certain combinations of products and services -- air conditioners with free installation, combinations of software packages, or season tickets with parking privileges. The difficulty is in devising the bundles that both appeal to consumers and give cost or demand enhancing benefits to the producers. Eppen, Hanson, and Martin argue that the best approach is to treat bundles not as marketing gimmicks but as new products. They offer seven guidelines for creating competitive bundles and a framework for implementing them.

Litigation, arbitration, mediation, mini-trial -- choosing from the menu of dispute resolution processes can be difficult. Ertel argues that, instead of choosing from available options, managers should consider building their own. Each dispute has its own history and characteristics that will dictate the most appropriate resolution process and settlement. In this article, he elaborates a series of steps for developing this process. By thoroughly understanding the nature of the conflict, managers can prescribe remedies and lead their organizations toward a solution of mutual gain.

Japanese success with some management practices may depend on cultural factors that are not present in the West. But that is not true as far as continuous improvement programs are concerned; CIPs were developed in the United States long before they were introduced into Japan by U.S. trainers working for the post-WWII occupation authorities. Schroeder and Robinson synthesize the fascinating history of improvement programs, from the early "awards scheme" of a Scottish shipbuilder to the present day. They propose four fundamental principles that can help managers build the competitive advantage no one can steal -- a constantly improving, highly productive, committed workforce.

Have you ever tried to introduce new technology on the plant floor? Just a guess: everything that could go wrong, did. You developed an action plan, but it proved virtually useless. Of course it did, say these authors. With all the possible problems that can arise, no plan that addresses specific contingencies is adequate. What you need is a plan that emphasizes organizational learning. By systematic learning from every angle, during all phases of implementation and well after, you can not only implement the technology successfully, you can continuously improve all your business processes.

Most managers recognize that good service is a direct result of having effective, productive people in customer contact positions. You need winners at the front lines, not just warm bodies. But most service companies perpetuate a cycle of failure by tolerating high turnover and expecting employee dissatisfaction. Schlesinger and Heskett explore the reasons that so many managers have trouble breaking this cycle. They spotlight a number of companies that are developing winning customer service teams, including one that pays twice the industry average to its front-line employees while its sales and profits have soared. Instead of submitting to the cycle of failure, they argue, managers should take advantage of ways to break it, and get their organizations onto the cycle of success.

Some companies have more than just a competitive advantage in customer service, they have unwavering customer loyalty. How do they do it? The authors argue that the key to providing superior service is understanding and responding to customer expectations. Through their research, two different kinds of expectations emerged, both of which can change over time and from one service encounter to the next for the same customer. By responding appropriately to these expectations, managers can be on their way to developing a “customer franchise.”