Lattitude.com is a simple two-party, single-issue, primarily distributive negotiation regarding the potential sale of an internet domain name. It is designed to be negotiated entirely via e-mail, and may either be used in an online course or as a supplement to a face-to-face course. This simulation is a good vehicle for discussing the dynamics of distributive bargaining as well as the effect of the communication via email on both process and outcome.

This case focuses on the financial health of Aspire, a forty-year-old nonprofit organization serving the needs of the developmentally disabled. To meet the residential, educational, and vocational needs of its clients, Aspire has grown significantly by expanding services and buying residences. As a nonprofit organization, Aspire has to consider financial implications and organizational/mission concerns as it explores the purchase of a building and the consolidation of administrative activities. The case enables students to explore the strengths and weaknesses of Aspire's financial situation, the primary financial indicators that different types of lenders would consider, as well as the financial and organizational costs and benefits to Aspire for the various lending options. The case profiles several different types of financing options, including traditional bank loans, the issuance of tax-exempt bonds, and the participation of a community development financial institution. Students are asked to do analysis and recommend a financing choice for Aspire. The case is based on work that the Illinois Facilities Fund, an Illinois community development finance institution, did with Aspire in 2000.

Studies the impact of tariffs, subsidies, and quotas on the U.S. steel market. Focuses on "winners" and "losers" from different policies. Applications to the events in the U.S. steel market in 2001 illustrate the impact of these policies.

In 1996, the St. Louis-based manufacturer Zoltek launched a massive expansion of capacity to produce commercial-grade carbon fiber, a composite material used to produce a wide variety of end products ranging from sporting goods to windmill blades. Zoltek's goal was to become the dominant firm in a market whose growth was expected to be spectacular starting in the late 1990s. Describes Zoltek's major strategic moves in the mid-1990s and provides a possible example of the Stackelberg leadership model from oligopoly theory.

Presents an analysis of the decision regarding a new product introduction. The main issues for discussion are: sunk costs, incremental costs, cannibalization, shared facilities, and the treatment of inflation.

The New York Audubon Society (NYCAS), founded in 1979, became the National Audubon's largest chapter, with a city-wide membership of more than 10,000 members. Prior to 1993, NYCAS' services were provided entirely by volunteers working in a committee structure, with the board composed primarily of committee chairmen. The nature of the organization transformed as it grew in size and complexity from focusing on bird conservation to broader environmental advocacy. In 1993, the board undertook a dramatic change and hired an executive director, primarily for fundraising purposes. Discusses fund accounting and nonprofit accounting practices, as well as the NYCAS' experiences dealing with organizational growth, investment management, grant acquisition and use, fundraising, nonprofit status, and financial disclosure.

Independent directors are showing up on more and more boards, and organizations must recognize and meet those directors' needs for information. It is now generally acknowledged that most boards need more directors who are truly independent. But the very fact that new directors are independent implies that they are, unwittingly and to a certain extent, uninformed about the company and its business. Which is why the quality of the information they get from the company must be very high.

Change is imperative for organizations to maintain competitiveness in a dynamic environment. Yet despite various tries, the success rates for major organizational change efforts have been rather dismal. This article identifies the reasons that organizational change usually fails, demonstrates that the errors made in the change process are rooted in organizational behaviour, and argues that leaders have not recognized the importance of emotions in creating successful change. While ideas for leading change exist, there are too few decision-makers who are capable of translating the ideas and following the guidelines that lead to a concerted, well guided effort to lead change. The author argues that all change is individual change. Leaders have to lead other individuals and convince them to change. The article chronicles the importance of appealing to the heart in leading change. Because change is fundamentally about feelings, companies that want their workers to contribute with their heads and hearts have to accept that emotions are essential to the new management style. The article also examines eight ways in which leaders can motivate the heart. Leaders have to ensure that individuals are convinced of the need for change; select a team of people to advocate the need for change, get individuals to trust the team and inspire confidence in the ability for change; create a vision that is clear, creative and viable; communicate in a way that is simple, heartfelt, aligned with people's feelings and speaks to their anxieties; let individuals express how they feel; celebrate interim successes; be persistent in change efforts and lastly, ensure that changes form an integral part of the corporate behavioural pattern.

Organizations differ considerably in their rate of performance improvement. Because any improvement trajectory is the fruit of a series of improvement projects, the proximate cause of this variation among organizations lies in the varied ways these projects are managed. The success of these projects depends, however, not only on the goals and the efforts of the project team, but also on the context within which the projects are undertaken--and, more specifically, on the competencies on which the projects can draw. It is variation in these competencies--the organization's underlying "performance improvement capability" (PIC)--that explains the substantial and sustained differences in rates of improvement across organizations. This article describes the efforts of several hospitals to strengthen their PIC through five key components: skills, systems, structure, strategy, and culture.

The decision to adopt a new technology in the health care setting is merely the first step in an implementation journey. Whereas some new technologies are readily embraced by those who must use them, most are met with some resistance. In some cases, members of diverse groups--including administrators, clinicians, and technicians--must work together for a new technology to take hold effectively, becoming incorporated into routine practice in an organization. This article reports on a qualitative study of hospitals adopting a new technology for minimally invasive cardiac surgery that uncovered substantial differences in both approach and implementation success. Four case studies are presented to illustrate distinct, tacit frames held by the leaders of each implementation project and how these influenced the team learning process and, in turn, implementation success.

The importance of hospitals learning from their failures hardly needs to be stated. Not only are matters of life and death at stake on a daily basis, but also an increasing number of U.S. hospitals are operating in the red. This article reports on in-depth qualitative field research of nurses' responses to process failures in nine hospitals. It identifies two types of process failures--errors and problems--and discusses the implications of each for process improvement. A dynamic model of the system in which frontline workers operate reveals an illusory equilibrium in which small process failures actually erode organizational effectiveness rather than drive learning and change in hospitals. Three managerial levers for change are identified, suggesting a new strategy for improving hospitals' and other service organizations' ability to learn from failure.

High performance is often attributed to an organization's culture. However, culture can just as easily undermine performance when it blinds decision makers to important performance issues and entraps them in unfortunate courses of action from which they cannot disengage. The dynamics of cultural entrapment are explored in the case of the Bristol Royal Infirmary, in which pediatric cardiac surgeries continued for over a 14-year period despite evidence of poor-quality care and performance that was far below that of other comparable pediatric surgical centers. A single organizational process of behavioral commitment explains how the cultural mindset originated and why it persisted. The sequence of small, public, volitional, and irrevocable action; socially acceptable justification for that action; and the potential for subsequent activities to validate or threaten the justification created a causal loop that stabilized subsequent action patterns.

Labor-management cooperation has been regarded for many years as a panacea for organizations' competitive woes. The academic and popular presses have lauded the joint efforts of companies and their unionized workforces to come together to solve companies' competitive problems while saving employees' jobs. Moreover, research on and examples of labor-management cooperation have found that through joint efforts, unions and firms can improve organizational performance and employee outcomes. Increasingly, however, it appears that cooperation is often but a short-lived phenomenon. This article examines a major initiative of labor-management cooperation that was undertaken to facilitate the fundamental restructuring of the health care delivery system in Minneapolis/St. Paul, Minnesota. For 10 years, management of more than a dozen hospitals and representatives of the Minnesota Nurses' Association came together to negotiate and manage the process of system integration, rationalization, and delivery improvement. The results were remarkable. Yet, just a few years later, despite the success, only remnants of labor-management cooperation remain in these hospitals. This article examines the reasons for this demise and provides lessons for those engaged in cooperative undertakings that may help extend the life of those initiatives.

The boom-to-bust cycle for Internet start-ups has been remarkably compressed. This article reports on a longitudinal study of eight industries that found that only 43% of independent B2B exchanges survived in the two years following Spring 2000. Most of these start-ups failed because they misdiagnosed their advantage over existing ways of doing business. In reality, the Internet is mainly about reformed applications that facilitate interactions and squeeze costs but do not change the basic structure and functioning of existing markets. Incumbents prevail when a technological disruption reforms an existing market rather than completely redefines industry boundaries and norms. Building on the lessons of past industry shakeouts, this article suggests that the prospective winners in digital markets will be found in three camps: adaptive survivors who find a protected niche by retooling their strategy for reformed markets; acquisitive incumbents who acquire the assets of pure-play companies at steep discounts; and pure-play start-ups that capitalize on their early-mover advantages in breakthrough markets.

Obstacles to high performance can be as profoundly demotivating on the shop floor as they are on the battlefield. And for high performers, factors they can't control can hinder their best work and may drive them to look elsewhere. The ones who stay behind may be the ones who don't care.

We like to think enlightened managers understand employee motivation. But research conducted by Stanford's Chip Heath suggests that managers are not as good at judging what drives their employees as they might think. The key to improving your ability to understand motivation is to appreciate that employees are driven by the same things you are.

It sounds simple: Compensate managers with stock or options, and they'll do what's best for shareholders. But it doesn't always work that way; more than a few executives have cashed in while shareholder value burned up. To fix that problem, Roger Martin contends, boards need to abolish stock-based compensation and replace it with bonuses based on real earnings growth.

David Gergen, adviser to presidents Nixon, Ford, Reagan, and Clinton, knows a thing or two about how leaders get their messages across. In this edited e-mail interview with HBR's Gardiner Morse, Gergen discusses the power of persuasion and the theatrics of communicating well.

The PC industry was in terrible shape in 2001. As Sony strived to fit the PC into a larger business model that included the sales of digital cameras, MP3 players, camcorders, TVs, cell phones and PDAs, the latter half of 2002 turned out to be financially very challenging for the PC business. Analysts were questioning the sustainability of Sony's successful entry and establishment of its PC business in the United States. Chronicles the 1995 to 1996 (re)entry efforts and results of the major Japanese firms. Describes the history of the U.S. PC as well as the U.S. PC market environment and developments during the period from 1995 to 2000.

Matt Grant, a part-time MBA student, is developing a free publication that lists a calendar of upcoming athletic events, including road races, walks, triathlons, biathlons, bicycle tours/races, open track meets, and multisport activities in the greater Boston region. In his spare time, he launched a trial edition, and the response is so encouraging that he is on the verge of giving up a promising career with a big electronics company to pursue his new venture full time. He is wondering how to break the news to his wife, who is pursuing her own career as a lawyer.