Articles

Over the last decade, supply-chain-management concepts have sparked a boom in internal cross-business coordination. But although definitions have broadened and shifted, many executives believe that the field is mainly about installing IT systems for streamlined processes. Wrong, say two researchers from Dartmouth’s Tuck School of Business. Their data on companies that lead in supply-chain management illuminate six ways it spurs more-creative thinking on growing a business. The researchers predict that current trends toward restructured supply networks and improved coordination will continue, with more supplier integration and a proliferation of product customization, business complexity and uniquely defined customer relationships. But supply-chain management also will affect industry structure in new ways. Companies in the middle of the supply chain & #8212; contract manufacturers, logistics-service providers and distributors & #8212; will redefine themselves. Also, rebranding and repositioning will occur. Companies across the chain will vie for control of the customer relationship and will find that when value propositions derive from supply-chain capabilities, new cobranding and copositioning strategies are critical. When executives look back after another decade, they’ll understand that supply-chain management, having shifted business focus in its first 10 years, created an opportunity for the second 10 years to redefine the competitive landscape.

Many managers in traditional product-oriented organizations are struggling to turn their companies into solutions-oriented businesses, widely considered the route to success in the 21st century. A good shortcut may be to establish corporate consultancies & #8212; consulting units that offer customers solutions based on the traditional business’s products or expertise. Thus computer companies such as IBM are moving toward integrated information-technology solutions, and telecom-equipment manufacturers such as Nokia are providing turnkey network solutions. Changing from a product-oriented manufacturer to a customer-focused solutions provider can be rewarding, but because it involves a sweeping reorientation of the organization, it is also difficult. That’s why the less radical approach of a consultative component often works best. But even that strategy has its challenges, with success depending on determined managers who know what the pitfalls are and how to avoid them. Without firm management, the consultancy may be swept away by forces that draw it too far into the product business or too far away from it. By thinking through the mission, identity and structure challenges and choosing the right strategy for handling them, leaders can both manage the consultative component and attain synergies between the product-centric business and the corporate consultancy’s customer solutions.

Research reveals factors that affect the likelihood of transacting business over mobile phones.

Leadership has become the hottest topic in business. Companies see this hard-to-pin-down ability as essential to organizational success, and they want their executives to learn how to exercise it. As a result, they are investing heavily in leadership-development programs and honing eloquent statements about the importance of developing next-generation leaders at every organizational level. And yet these speeches and investments have often failed the companies seeking to create a pipeline of leaders. The authors have identified three pathologies at the root of many leadership-development failures. They cite outdated thinking about ownership of the efforts, a product-focused, quick-fix mentality, and make-believe metrics that measure activity rather than capability. The danger is that these pathologies will sour companies on leadership development, leading them to cut investment and go back to waiting passively for leaders to emerge. But that approach has failed in the past and will continue to do so. Companies that make leadership development a core business process can overcome the pathologies and prepare the individuals and teams they will need to take their organizations to greater heights.

When it comes to thinking about scale, the assumption of corporate leaders since Henry Ford’s day has been that bigger is better. And in many situations, such thinking is inarguably correct because of the cost efficiencies that size provides. But sometimes efficiencies can mask opportunities. In their research, the authors found that small-scale operations provide significant advantages in four areas. They allow companies to locate hot spots and tap into local knowledge networks; they make it possible to respond more rapidly to customer needs and to trends in regional demand; they enable companies to monitor potentially disruptive technologies; and they help hold down labor costs while developing managerial talent. Using case studies, the authors illustrate how companies in a wide variety of industries have found the hidden benefits of small-scale approaches to corporate needs. They conclude that executives who develop a deeper understanding of scale and learn when it is better to think small can have a potentially huge impact on their companies’ long-term success.

As the shadow of corporate scandals looms ever larger, government’s role in regulating and influencing core business practices also has grown more prominent. As a result, businesses are struggling to reconcile the spotlight of increased regulation with the goals of corporate strategy. To navigate these difficult straits, businesses need to understand how governments can help or hinder their business objectives while they develop hybrid strategies that focus on shaping the rules. It becomes essential that companies better understand the games business and government play and the roles of each in making and enforcing the rules. Michael D. Watkins, associate professor of business administration at Harvard Business School, identifies two major types of games: value-net games, which relate to cooperation and competition among businesses, and public-interest games, in which coalitions of businesses and industry associations are pitted against nonbusiness organizations, such as unions, consumer groups and environmental entities. Watkins believes that the most effective businesses craft their strategies by combining different approaches from each game, which in turn helps to shape how governments regulate future corporate activity.

How the industry's evolution can inform all e-tail enterprises.