Articles

Despite the popularity of flexible manufacturing systems, managers suffer from inadequate frameworks to help incorporate flexibility into their strategic planning. Through a study of thirty-one plants in the printed circuit board industry, the authors progress toward such a framework, define types of flexibility, and examine the relationships among them. Their findings have implications for technology, production management, human resource management, supplier relationships, and product development.

The approaches for improving quality in manufacturing processes don't work especially well for software development. The authors provide a quality improvement paradigm for the software industry that builds on manufacturing models but focuses on reused learning and experience by establishing "experience factories." Their iterative process enables an organization to acquire core competencies to support its strategic capabilities.

Why are some companies able to remain vital, even after extensive reengineering, while others flounder and fail? The answer, according to these authors, lies in a company's ability to rejuvenate its employees by establishing a behavioral context with four characteristics -- discipline, support, trust, and stretch. The authors trace postwar corporate history to identify the pernicious qualities that have ossified many companies, using the example of Westinghouse to illustrate an oppressive context based on the elements of compliance, control, constraint, and contract. They also show how companies like Intel and 3M have been able to renew themselves by creating an environment in which people are the most important resource.

Although returns policies have been widely used for many years, they continue to be a source of controversy. The authors present a framework that explains when and how to adopt returns policies. They analyze the benefits and costs of accepting returns from distributors, and also compare returns policies to alternative ways of coordinating the distribution channel.

Companies are examining their use of space more carefully to reduce occupancy costs. Misconceptions about the role of accommodation in organizations have led to costly inefficiencies in space planning and building use. Reducing square footage provides a company with a two-stage opportunity for improvement. First, space "right sizing" and redesign can lead to a better "fit" between work-space design and users' tasks; employees' work space can more effectively support work performance and improve productivity. Second, the process of making space cuts and changes is an opportunity for initiating broader-based corporate change in companies seeking to reduce overhead, empower employees, and reengineer work processes. The author offers examples that show how some companies have used work-space changes to transform their business and how CEOs can take full advantage of this opportunity.

For managers, the challenge of understanding nonmarket forces — government, interest groups, activists, and the public — is frequently more difficult than understanding the market environment. The author develops a strategy system of principles, frameworks, and action plans to deal with the issues, in-stitutions, interests, and information that characterize the nonmarket environment. He uses the concept of a rent chain, analogous to the value chain, to show how com-panies can participate in policy-setting processes and generate leverage to their own benefit.

When employers focus only on the direct, out-of-pocket costs of health care, they fail to consider the indirect costs of illness in the workplace form workers' impaired functioning on the job and absenteeism. The authors present a case study of the effects of clinical depression on direct and indirect health-related costs and provide a model that employers can apply to a wide range of illnesses to analyze their investments in health care. The authors apply the framework to several workplace situations -- employees' depression, cigarette smoking breaks, and arthritis -- to estimate the costs of lost productivity. They also show how to do a break-even analysis to determine when employers' investments in health interventions are likely justified.

The production-line approach to service is being challenged by an employee empowerment approach. Despite its growing popularity, many managers are till uncertain about empowerment’s impact. The authors describe the returns a company can expect from empowering service employees, which include a number of favorable business results, but new management changes as well.

In this case study, the authors describe Toshio Okuno's five techniques for managing major changes in his company.

Is it time to reform the financial reporting regulations that were established in the early 1900s? Will new regulations improve the corporate disclosure process? The authors conducted a national survey of corporate managers, financial analysts, and portfolio managers to examine their options on disclosure regulation and how companies communicate with the capital markets. Their analysis indicates that, while all three groups think market functioning is imperfect, they do not see a need for increased financial reporting regulation. Rather, the authors' analysis suggests that companies can improve the processes of disclosure and communication by developing a strategy for corporate information disclosure, upgrading the role of the investor relations staff, and voluntarily reporting nonfinancial information. Such improvements would increase management credibility, analysts' understanding of the firm, investors' patience, and, potentially, share value.