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Faced with saturation of their core product markets, companies in search of growth are increasingly turning to services. A few companies have enjoyed success with this approach; others have not been so fortunate. The authors explain how managers can improve the odds of success by taking a systematic approach to creating services-led growth. Companies must begin by redefining their markets in terms of customer activities and customer outcomes instead of products and services. Customers seek particular outcomes, and they engage in activities to achieve them. These activities can be mapped along a customer-activity chain, which is the foundation for exploring services-led growth opportunities. Analogous to product-centric growth strategies such as product-line extension, product-line filling and brand extensions, customer-activity chains can be extended, filled, expanded or reconfigured with new services. The authors have developed a framework -- the service-opportunity matrix -- to help managers structure the investigation of new opportunities. For each quadrant of the matrix, they provide a set of questions to help companies determine whether a particular approach would work for them. In addition, they have devised another matrix, on risk mitigation, to help managers assess the pitfalls and risks that these opportunities represent.

Over the past decade, companies have become increasingly aware of the social and environmental pressures facing business. Many management scholars and consultants have argued that these new demands offer terrific opportunities for progressive organizations, and innovation is one of the primary means by which companies can achieve sustainable growth. But, say the authors, the reality is that managers have had considerable difficulty dealing with sustainable-development pressures. Specifically, their innovation strategies are often inadequate to accommodate the highly complex and uncertain nature of these new demands. In response, the authors propose the concept of sustainable-development innovation, or SDI. In contrast to conventional, market-driven innovation, SDI considers the added constraints of social and environmental pressures. SDI is therefore usually more complex, because there is typically a wider range of stakeholders, and more ambiguous, as many of the parties have contradictory demands. Furthermore, sustainable-development pressures can be driven by science that has yet to be accepted fully by the scientific, political and managerial communities. Organizations that fail to understand such issues could well find themselves making costly mistakes in bringing new technologies to market.

Long-term research conducted with companies such as ABB and Lufthansa has helped the authors identify four organizational energy zones that, harnessed properly, can provide a powerful boost for achieving strategic goals. The researchers offer insight on selecting the type best suited to a company's culture and its leaders' personal style. They find that analytical approaches to management are increasingly incorporating a greater understanding of the major role that emotions play in corporate behavior. Today's challenge for leaders, the authors say, is to ensure that the company's vision and strategy capture employees' excitement, engage their intellect and fill them with urgency for action taking. First, they show that companies operating in what they call the aggression zone (responding to a threat) or the passion zone (responding to an exciting goal) are more likely to be successful. Companies in the low-energy comfort zone coast dangerously on past success, and those in the resignation zone have nearly given up. Second, they describe two strategies for unleashing organizational energy and the circumstances that indicate which to use. Finally, they point out ways to avoid common energy traps. Without a high level of energy, the authors contend, a company cannot achieve radical productivity improvements, grow fast or create major innovations. The researchers give examples of enlightened managers who are focusing on unleashing that energy and are leading their companies to outstanding performance.

Evolving a global approach to corporate distress is a difficult challenge, says the author, in part because codes vary internationally, reflecting fundamental differences in approaches to bankruptcy and attitudes about financial recovery. The U.S. approach favors rehabilitation as the way to serve creditors and restore value, whereas European nations lean toward liquidation. The author, who has worked with troubled companies in a variety of roles, describes how practitioners abroad are developing new, integrated approaches. Under the "light touch" approach, for example, a court-appointed administrator comes to agreement with the incumbent management team on operating protocols and delegates limited authority to it under administrator supervision. Thus, a more flexible, pragmatic approach is evolving that could represent a breakthrough for the global business community. To capitalize on such trends, the author, there are two additional strategies that could help establish common ground between the European and U.S. systems. The first is early intervention, which could make a difference in Europe and in relatively simple cases of corporate distress. However, in more complex situations, especially those that involve a bankruptcy filing in one or more national jurisdictions, a technique that is increasingly popular in the United States could be useful -- the retention of a "chief restructuring officer." Reporting to the board of directors rather than to a company's existing management team, a CRO is charged with developing and executing a plan to restructure the company's finances and/or operations. According to the author, the involvement of a CRO might well increase the likelihood of successful outcomes when rehabilitation is attempted with Europe-based companies, in part because many European practitioners lack experience in restructuring. With the various regulatory and attitudinal changes taking place across Europe, the author contends that a viable common-ground approach that seeks to maximize enterprise value is evolving -- to the benefit of companies, creditors and economies.

Having received a great deal of attention for decades now, customer satisfaction (CS) practices have become one of the core prescriptions for managers and organizations. Indeed, for many companies, customer satisfaction has become the guiding principle, as they increasingly initiate all manner of strategies and processes under its banner. But more and more, says Fredrik Dahlsten, these practices are losing their effectiveness for companies and their customers alike. Using qualitative research at Volvo Cars, the author illustrates how the interpretation of customer satisfaction can become skewed, employing rigorous and extensive CS measurements, but measuring the wrong variables and using the information in mainly reactive ways. Many companies have only an intrinsic CS focus -- a product orientation based on attribute quality and a short-term internal perspective triggered by surveys and aimed at cost control. With an intrinsic focus, customer satisfaction is seen mostly as the absence of dissatisfaction. In contrast, an extrinsic CS focus emphasizes finding new ways to increase the positive, emotional aspects of the customer experience over time. The author argues that managers who wish to climb out of their customer satisfaction rut must move beyond the mere measurement of quality, refocus their practices on the customer's actual experience and formulate a comprehensive strategy for using that knowledge throughout the organization. He illustrates those concepts by showing how practices at Volvo are being improved to incorporate a greater extrinsic focus and make better use of the resulting customer knowledge.

What kinds of companies and products can benefit most from the use of new information technologies (NIT), such as the Internet, broadband networks and mobile communications? Books and airline tickets sell readily over the Web whereas automobiles do not. Furthermore, what types of business transformations does NIT enable? A company might, for example, use NIT to eliminate middlemen, such as distributors, that separate it from its customers (called classic disintermediation). Or, instead of getting rid of middlemen, it might choose to embrace them (remediation). Or it might build strategic alliances and partnerships with new and existing players in a tangle of complex relationships (network-based mediation). All three mediation strategies depend on various factors, such as a product's customizability and information content. By fully understanding those drivers of NIT, companies can begin to predict the potential transformations of their industries, especially in terms of how products are marketed and sold. To that end, the authors have developed a systematic framework that identifies which drivers are important for each of the three mediation approaches. Using this tool, companies can determine both the optimum ways to transform their businesses and the NIT investments required to accomplish such changes.

Dispelling the notion that today's business milieu is one of unremitting change, Huy and Mintzberg urge managers to realize that we perceive our environment to be in constant flux because we tend to notice only those things that do change. While conceding that some important changes have taken place in recent decades, they point out that stability and continuity actually form the basis of our experience, providing the contextual meaning of change. And because many things remain stable, change has to be managed with a profound appreciation of stability. Accordingly, there are times when change is sensibly resisted; for example, when an organization should simply continue to pursue a perfectly good strategy. Having acquired in-depth familiarity with many organizational-change situations (some gleaned from their experiences as consultants or when working in managerial capacities, others as part of research projects to track the strategies actually used by companies over many decades), the authors present a framework in which pragmatic, coherent approaches to thinking about change can be explored. Although a lot of attention is focused on the type of change that is imposed dramatically from the top, Huy and Mintzberg believe that this view should be tempered by the realization that effective organizational change often emerges inadvertently (organic change) or develops in a more orderly fashion (systematic change). Because dramatic change alone can be just drama, systematic change by itself can be deadening, and organic change without the other two can be chaotic, the authors argue that they must be combined or, more often, sequenced and paced over time, creating a rhythm of change. When functioning in a kind of dynamic symbiosis, dramatic change can instead provide impetus, systematic change can instill order, and organic change can generate enthusiasm. The authors illustrate their framework with older and newer examples, saying that this highlights another crucial point: The problem with change is the present. Today's obsession with change tends to blind managers to the fact that the basic processes of change and continuity do not change.

Why do motivated managers often fail to follow through? Because motivation is not enough. Superficial and dependent on incentives, motivation gives up in the face of serious obstacles. For purposeful action taking at work, managers must engage a more powerful attribute, their willpower. The best already do, crossing a personal Rubicon to deep commitment. How that happens is the subject of studies by professors from the London Business School and the University of St. Gallen. The researchers find that managers commit for highly individual reasons but that five strategies can help enterprises create the right environment. The companies studied included large ones such as ConocoPhillips and Lufthansa and small ones such as Micro Mobility Systems of Switzerland. The managers who achieved their apparently impossible goals had in common an intense inner struggle to commit. Once their willpower was engaged, they were able to deal with setbacks and persevere. The best way to build persistent organizational commitment is bottom-up, on the foundation of personal ownership of and commitment to specific initiatives and goals. In the world of mobile employees, frontline entrepreneurship and constant, unavoidable organizational restructuring, corporate leaders must develop that kind of commitment if they want to see action and follow-through in their companies.

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.

Executives make few moves more critical than their decisions about which technology-infrastructure investments will promote future strategic agility. To pinpoint best practices, three IT experts marshaled 10 years of data from 89 leading enterprises. One finding was that when companies describe their IT-infrastructure capabilities as services instead of equipment (say, the provision of a fully maintained laptop computer with access to all company systems and the Internet), they do a better job of putting a value on what they are buying. Understanding the 70 IT-infrastructure services that emerge consistently from the research can help executives identify which investments will make sense for which strategic business initiative. And understanding whether the contemplated initiative is supply-side, internally focused or demand-side can help managers decide whether to make the infrastructure investment on a business-unit level or enterprisewide. The authors find that leading companies are making regular, systematic, modular and targeted IT-infrastructure investments on the basis of overall strategic direction. If other companies can learn to recognize which IT-infrastructure capabilities are needed for which kinds of initiatives, they can have some assurance that the investments they make today will serve the strategies of tomorrow.