Emerald Group Publishing Limited
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Articles everyone needs to read
Article Type: Editor’s letter From: Strategy & Leadership, Volume 39, Issue 6
Some of the foundation ideas that built the modern corporation – hierarchical management, shareholder value, CEO stock-based compensation and functional bureaucracy – have shown their dark side in an era when corporations can survive only by rapidly adapting to discontinuity. Hierarchical management diminishes opportunities for individual contributions; shareholder value unfairly trumps other stakeholder interests; the excesses of CEO stock-based compensation have become scandalous; and functional bureaucracy drags innovation to a crawl. Fortunately, plenty of articles that propose thoughtful remedies are being published. But few of them describe how a large, complex organization has implemented alternative strategic management models.
So several months ago, we invited two authors who had published Strategy & Leadership articles about their radical management models to write case studies of the operations of successful companies that had adopted their ideas. The results are two provocative cases featured in this issue. Both should be read in conjunction with the authors’ ground-breaking articles that appeared in earlier issues of S&L.
In the first case, “Successfully implementing radical management at Salesforce.com,” Stephen Denning describes how a high tech company quickly transitioned from traditional management to radical management using Scrum methodology. Not many companies have made this leap, and this case explores the factors that made the implementation successful and identifies the pitfalls that were avoided. For more on this topic, I suggest Denning’s award-winning introduction to the principles of his dynamic-linking model, “A leader’s guide to radical management of continuous innovation,” published in S&L Volume 38, Number 4, 2010.
The second case, “How BMW successfully practices sustainable leadership principles” by Gayle C. Avery and Harald Bergsteiner illustrates why BMW’s implementation of honeybee leadership principles and practices enabled it to survive the Global Financial Crisis in good condition. Although it was battered like the rest of the auto industry, BMW emerged from the recession strongly, reporting the best results in its history in 2010. For more background on honeybee principles, Avery and Bergsteiner described their innovative management model in “Sustainable leadership practices for enhancing business resilience and performance,” S&L Volume 39, Number 3.
To address the dark side of CEO stock-based compensation, S&L invited Roger Martin to explain why, in his opinion, it is associated with lower shareholder returns, bubbles and crashes, and huge corporate scandals. Best known as a leading advocate of design thinking, Martin offers a manifesto, “The CEO’s ethical dilemma in the era of earnings management,” that highlights the need for radical change in compensation practices.
Addressing the topic of ethical behavior in general, Gerard L. Rossy proposes a methodology leaders can use to promote ethical fitness in their organization in “Five questions for addressing ethical dilemmas.”
For my last “must read” suggestion, I recommend “Seven basic strategic missteps and how to avoid them” by Simon Mezger and Maurice Violani, two A.T. Kearney consultants based in Australia. In a highly competitive, high-change business environment, a sound, defensible strategy is critical to growth. To decide if your company has a winning strategy or one that is herding your business toward stagnation, the authors show how to assess whether your strategic initiative suffers from any of seven common yet crippling shortcomings. It’s a useful review for veteran strategists and a highly valuable short guide for novices. Pass it along!
Robert M. RandallEdito