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A survey of CEOs at Fortune 1,000 firms asked about their firms' hurdle rates and time horizons. Survey results suggest that most U.S. firms use hurdle rates that are higher than standard cost-of-capital analyses would suggest. The average discount rate applied to constant-dollar cash flows was 12.2 percent, distinctly higher than equity holders' average rates of return and much higher than the return on debt during the past half-century. At the time of the survey, the fall of 1990, U.S. CEOs believed that their firms had systematically shorter time horizons than their major competitors in Europe and (especially) Asia. U.S. CEOs also thought that government policy is a powerful agent affecting corporate planning horizons. They saw several policy reforms, including a cut in corporate tax rates, a permanent R&;D tax credit, a corporate tax deduction for dividend payments, and a credible commitment to a stable tax policy for the next decade, as policies that could lengthen planning horizons.

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.

Formerly adversarial relationships between retailers and their suppliers are giving way to cooperative partnerships in which both try to improve merchandise and information flow in the distribution channel system. By cooperating, retailers and suppliers can speed up the replenishment of inventories, improve customer service, reduce the need for markdowns, and cut the cost of bringing goods to the customer. The authors outline the key features of channel partnerships and discuss the reasons for their rapid formation during the 1990s. They describe the changes needed in traditional merchandising and distribution systems to gain the benefits of a partnership and the requirements for a successful channel partnership.

A follow-up survey to one published in the Summer 1991 issue of Sloan Management Review ("How Much Has Really Changed between U.S. Automakers and Their Suppliers?" by Susan Helper) shows that long-term, closely linked relationships have performance advantages for automakers and their suppliers in both the United States and Japan. Although such high-performance relationships with customers are still more prevalent in Japan than in the United States, the nature of supplier relations in the two countries is converging in some respects. The current survey includes more than 600 automotive suppliers in the United States and almost 500 suppliers in Japan.

To the extent that buyer-supplier relationships can be cooperative, value can be created for both customers and vendors. Regrettably, the traditional behavior of some industries, particularly the U.S. automotive industry, often precludes cooperation. The authors describe one successful case -- the experiences of ABB and the Ford Motor Company during the design and construction of a $300 million facility. The authors explain the key factors that led to ABB's and Ford's success and how value-adding cooperation between buyers and suppliers can be fostered.

Eastman Kodak's success in outsourcing its information systems (IS) department has triggered intense interest. Many executives are asking whether the IS function can be considered a commodity service, best managed by a large supplier. To dig beneath the media success stories, the authors studied fourteen Fortune "500" companies that faced outsourcing decisions. Their experiences are sobering news to anyone ready to jump on the bandwagon. More detailed descriptions of their case studies appear in the authors' book, Information Systems Outsourcing: Myths, Metaphors, and Realities (Wiley, 1993).

The track record for information technology (IT) implementation is not very good. MIT's Management in the 1990s program concluded that the benefits of IT are not being realized because investment is heavily biased toward technology and not toward managing changes in process and organizational structure and culture. The authors draw on general change management literature to develop a framework for managing IT-enabled change. They argue that IT-enabled change is somewhat different from change driven by other concerns. Nonetheless, a number of models from the change management literature can be quite useful. Their framework provides a common language for managers implementing IT-based change and shows how technology, business processes, and organization must be adapted to each other for such change to be effective.

Managers don't need any more vague advice about paying better attention to customers. They need the practical, step-by-step methods described in this article. In 1990, a medical equipment manufacturer needed to redesign one of its products to beat an aggressive competitor. It used a method called the "House of Quality," which related market research information directly to product design, thereby helping the company focus effectively on the most important product benefits. The new design revolutionized the product and was a phenomenal success. Here's how the company did it.

Business process redesign has focused almost exclusively on improving the firm's internal operations. Although internal efficiency and effectiveness are important objectives, the authors agree that business network redesign -- reconceptualizing the role of the firm and its key business processes in the larger business network -- is of greater strategic importance. To support their argument, they analyze the evolution of Baxter's ASAP system, one of the most publicized but inadequately understood strategic information systems of the 1980s. They conclude by examining whether ASAP's early successes have positioned the firm well for the changing hospital supplies marketplace of the 1990s.

In 1982, Robert Benjamin published a forecast of the state of information technology in the year 1990. He wrote that the information systems environment was in a considerable state of "flux" and information systems managers could benefit from a prediction of the "endpoint scenario [in order to] focus major planning strategies." Ten years later, it's time to provide a new set of landmarks for another decade of flux. Benjamin and his coauthor, Jon Blunt, envision the information technology world of 2000. What can we expect? What should we not expect? And what can we not even begin to guess?