Emerald Group Publishing Limited
Article Type: Editor’s letter From: Strategy & Leadership, Volume 43, Issue 6
For the hard copy of each issue of Strategy & Leadership, our cover headlines announce, in the most practical language we can muster, that our newest collection of articles offers solutions to the strategic management problems you face. Digital readers miss out on these alerts. This issue the hardcover headlines are:
1. Insourcing engineering innovation: a capability lost and found.
2. How Agile can revitalize corporate culture.
3. Six dilemmas of strategy execution.
4. How to find high-value opportunities for business model innovation.
5. Signs that an era of self-serving leadership is ending.
6. The myth of customer loyalty: why information and scale are more important during downturns.
For a fun experiment that print and digital readers can take part in, try matching the cover headlines with the following quotes from the articles in this issue:
A. “Ignore your current offerings for the moment and focus instead on the larger problem your customers have, only part of which your current products address.”
B. “Every program our more senior engineers lead is an education for developing junior engineers. Engineering is basically an apprenticeship model.”
C. “And what is more important and fragile than managing the confidence required for the crossover from the old way of operating to the new strategic state?”
D. “Relationships were used to obtain clients’ budget forecasts, planned revenues and profitability expectations. Each client’s future outsourcing strategies were inferred from these data.”
E. “Now we have reached a crossroads where authentic leaders have an opportunity to reassert themselves as pillars of the community.”
F. “The … mindset is neither top-down nor bottom-up: it is outside-in.”
To make the matchups easier, the following brief summaries of the articles, with an introduction to their distinguished authors, should start to acquaint you with the practical, often surprising, insights and counsel they deliver.
“Innovation advantage: insourcing engineering” by A.T. Kearney consultants Reuben Chaudhury, Dieter Gerdemann and Bharat Kapoor makes the case that insourcing engineering is a strategic investment in developing the core competence and innovative capacity needed to continually push the frontier, which is essential to creating fresh marginal value under all market scenarios. A case is provided by Kevin Nolan, Chief Technical Officer of General Electric Appliances.
Radical management researcher Stephen Denning has been traveling to leading companies across the globe to observe “How to make the whole organization Agile.” The new ways of organizing, creating, marketing, making, selling and delivering products and services don’t look or feel much like their predecessors. The workplaces they create are different. They are highly interactive and can mobilize vast ecosystems of partners and customers, enabling them to achieve massive scale. The managers are not just tinkering with obsolete practices that are increasingly irrelevant and ineffective. These organizations have been creating something fundamentally different: a culture of agility.
As “The six dilemmas of strategy execution” by Alex Lowy explains, dilemmas do not signal that a strategy is flawed or that leadership is failing. Rather, they are part and parcel of the strategy implementation process; they present consequential choices that need to be understood and addressed, and when they are, rewards and success are likely to follow. Conversely, ignoring and under-managing execution-dilemmas is a sure recipe for trouble.
“How to discover and assess opportunities for business model innovation” by Andrew Hargadon of the University of California, Davis shows why a new business model should not be the initial goal but the by-product of a process that focuses on maximizing the long-term value you provide to your customers. Business model innovation occurs when companies simultaneously make changes in their offerings and in the capabilities to develop and deliver them. But changing both the company’s offerings and its organization exponentially increases the complexity and uncertainty of any new undertaking, which is why business model innovation is both so difficult and, when successful, so hard for competitors to respond to.
In his S&L interview, “Bill George: the era of self-serving leadership is over but global markets pose the next authenticity challenge for leaders” the Professor of Management Practice at Harvard Business School and former CEO of Medtronic, describes the research that made him leading advocate for a more values-driven kind of leadership, one more “committed to leading with purpose to make a difference in the world and leave behind lasting legacies.” According to him, the road to becoming an authentic leader starts with a commitment to discover your own “True North,” the core to your deepest values and sense of identity and the primary wellspring of a leader’s ability to engender trust, which is increasingly central to being able to create the kind of entrepreneurial organizational cultures that can empower others to lead, not just simply inspire them to follow. His new book, Discover Your True North, surprisingly concludes that many of “today’s corporate leaders are the finest we have ever had,” he told S&L’s distinguished interviewer, Professor Brian Leavy of Dublin City University.
“The myth of customer loyalty: why information and scale are more important during downturns” by Murali Kailasam and Winai Wongsurawat warns that a focus on promoting customer loyalty may not be a supplier’s best strategy for preventing customer desertions and business losses during recessions. The authors’ field interviews in the Indian IT and IT services industry suggest that customer retention success may be better explained by the vendor’s capabilities—such as an information advantage, diverse competencies and scale – that enable it to offer the client a superior deal even in a painful business downturn.
Answers to matching the cover headlines and quotes: 1., B; 2., F; 3.,C; 4.,A; 5.,E; 6. ,D.
Robert M. Randall