Volvo Trucks has worked on a global strategy for several decades. Beginning in the mid-1970s, the company decided to enter the largest market for trucks: the United States. Over time, the company has struggled to get a significant share of the U.S. market and at the same time integrate operations around the world into a truly global strategy. However, the competitive structure (five-force model) differs significantly between Europe and the United States, and in spite of heavy investments, the global synergies seem far-fetched. This case illustrates clearly that entry and penetration of a market is a learning process for Volvo, where the initial strategic logic and underlying assumptions have to be changed several times.
In December 1999, only weeks after protests at the annual meeting of the World Trade Organization sparked violent protests which rocked the city, Seattle public safety officials face a new threat. An Algerian man has been arrested trying to cross the US border from Canada-in a car whose trunk is filled with enough explosions, says the FBI, to topple a multi-story building. What's more, the arrested man, Ahmed Ressam, had held a reservation at a motel just blocks from Seattle's most famous landmark, the Space Needle, in the Seattle Center, at which thousands of city residents and tourists are scheduled to celebrate the first New Year's Eve of the 21st century. This case examines the decision-making process of Seattle officials as they consider whether the possibility of terrorism should lead them to cancel the elaborate public celebrations scheduled to coincide with the dawn of the new millennium. Pair with Sequel (HKS 865). HKS Case Number 1648.0
In December 1999, only weeks after protests at the annual meeting of the World Trade Organization sparked violent protests which rocked the city, Seattle public safety officials face a new threat. An Algerian man has been arrested trying to cross the US border from Canada-in a car whose trunk is filled with enough explosions, says the FBI, to topple a multi-story building. What's more, the arrested man, Ahmed Ressam, had held a reservation at a motel just blocks from Seattle's most famous landmark, the Space Needle, in the Seattle Center, at which thousands of city residents and tourists are scheduled to celebrate the first New Year's Eve of the 21st century. This case examines the decision-making process of Seattle officials as they consider whether the possibility of terrorism should lead them to cancel the elaborate public celebrations scheduled to coincide with the dawn of the new millennium. Pair with full case (HKS488). HKS Case Number 1648.1.
When Anthony Williams is elected mayor of Washington, DC in November 1998, he inherits a city that had been close to insolvency. Although its financial picture has improved, it has historically lacked the equipment and systems to deliver high-quality city services. Williams had won a convincing victory at the polls in part by emphasizing the need for improved service and accountability. He faces two challenges: both to improve the quality of city services and to devise a way to ensure voters are aware of the extent of the improvement. With both in mind, Williams and his top aides develop a new system to guide city government. The comprehensive performance measurement system requires all city departments to set measurable "scorecard" goals for improving the services they deliver-and to report regularly on their progress in meeting them. This case describes the design and implementation of the DC performance measurement system, with particular focus on several specific departments. The case is designed, specifically, to help students understand the difference between outputs and outcomes, a distinction reinforced by a review and assessment of the goals set by the city departments featured in the case. Data provided in exhibits provides a vehicle for reinforcing the output/outcome distinction-and the tendency of public sector agencies to see outputs as an end in themselves. HKS Case Number 1647.0
Companywide incentives often produce disappointing results; individuals assume they will receive rewards regardless of their efforts. But at Continental, such a program resulted in more efficient employees and more timely flights. Here's how the airline did it.
Media companies have used digital rights management to protect their copyrighted materials from infringement. These technologies may also help companies shield proprietary information from digital attacks.
Ethical considerations aside, U.S. companies damage their long-term business interests when they turn a blind eye to the "dirty money" that flows through their coffers. Policy strategist Raymond Baker explains why.
Companies should make design and manufacturing decisions with eventual recycling and reconditioning of their products in mind. Here are the five key activities for establishing a reverse supply chain.
George Caldwell, cofounder of Advaark, a cutting-edge ad agency, was listening hard to his biggest client, John McWilliams, CEO of GlobalBev. McWilliams ran a multibillion-dollar holding company for an assortment of food and beverage brands but was giving credit to Advaark for his latest product line. "We were completely blindsided by this whole 'energy drink' craze," McWilliams was saying, clearly delighted that Advaark had steered his company into the business. Then he enthused, "I'd love to get your thinking about our snack lines." "Oh, no," George thought. He hadn't realized that his partner, Ian Rafferty, had made this foray into strategic consulting. Traditionally, their agency focused only on the creative execution of ad campaigns. In fact, they'd disagreed before about whether it was wise to follow customers' needs into areas where they had no skills advantage. George thought Advaark should stick to its core competence. Ian saw a source of easy revenue and an enhanced offering to clients who, he claimed, wanted one-stop shopping. The potential was appealing, but for George, it hardly outweighed the downsides. They'd risk alienating the strategy companies that now referred clients to Advaark. They'd need to recruit or develop new kinds of talent and create a methodology and training. George was just deciding to nix the expansion when a chance meeting with a former client made him pause. She'd heard about GlobalBev's success and wanted the same kind of help. Eager to win back a lapsed account, George was tempted. Should Advaark meet more of its customers' needs by expanding its services or stay focused on what it does best? In R0202A and R0202Z, commentators Gordon McCallum, John O. Whitney, Roland T. Rust, and Chris Zook weigh in on this fictional case.
The ponderous U.S. Postal Service transformed itself into a competitive business--for a while. By 1999, the agency had recorded four years of surpluses totaling more than $5 billion and was crafting a strategy for success in the new economy. In a symbolic victory, the agency's own Lance Armstrong won his first Tour de France. Eighteen months later, the Postal Service was struggling to stay afloat. The tragic events of September 11--and those that followed--only exacerbated the situation. How did such an optimistic scenario turn sour so quickly? Robert Reisner, the Postal Service's former vice president for strategic planning, recounts what it felt like to see the turnaround stall, and he offers four lessons on how to prevent change initiatives from faltering. The author offers some general insights into how an organization can keep a turnaround on track: Don't miss your moment. Precious momentum is lost when you fail to capitalize on fleeting market opportunities or high morale within your organization. Connect change initiatives to your core business. Promising programs can wither if they are not integrated into your mainstream operations. Don't mistake incremental improvements for strategic transformation. Operational success can blind you to the need to reinvent the business. Be realistic about your limits and the pace of change. Raising expectations that can't be met, at least at the moment, can undermine changes that are achievable.
Last fall, the United States was brutally thrust into a new and dangerous world. As the twin towers of the World Trade Center collapsed and the Pentagon burned, the horrible reality of terrorism seared the American consciousness. It touched more than the victims and their families; everyone who sat transfixed before the horrific images on TV lived through the trauma. In a sense, we were all eyewitnesses, and we must all cope with feelings of anger, stress, and anxiety. That poses a huge immediate challenge for business, because it is largely in the workplace--where we spend so many of our waking hours--that we will confront these emotions. What responsibility does a company bear for the mental well-being of its workforce? If companies help employees deal with depression and anxiety in the wake of terrorist acts, doesn't that put mental health care on the business agenda? To answer these questions, HBR senior editor Diane Coutu talked with Dr. Steven Hyman, the former director of the National Institute for Mental Health. In this interview, he suggests that September 11, 2001, may come to be seen as a tipping point--the moment when managers started to think about dealing with mental health issues on a regular basis.
Managers will tell you that the resource they lack most is time. If you watch them, you'll see them rushing from meeting to meeting, checking their e-mail constantly, fighting fires. Managers think they are attending to important matters, but they're really just spinning their wheels. For the past 10 years, the authors have studied the behavior of busy managers, and their findings should frighten you: Fully 90% of managers squander their time in all sorts of ineffective activities. A mere 10% of managers spend their time in a committed, purposeful, and reflective manner. Effective action relies on a combination of two traits: focus--the ability to zero in on a goal and see the task through to completion--and energy--the vigor that comes from intense personal commitment. Focus without energy devolves into listless execution or leads to burnout. Energy without focus dissipates into aimless busyness or wasteful failures. Plotting these two traits into a matrix provides a useful framework for understanding productivity levels of different managers. This article will help you identify which managers in your organization are making a real difference--and which just look busy.
In this essay, business thinker Peter Drucker examines the changing dynamics of the workforce--in particular, the need for organizations to take just as much care and responsibility when managing temporary and contract workers as they do with their traditional employees. Two fast-growing trends are demanding that business leaders pay more attention to employee relations, Drucker says. First is the rise of the temporary, or contract, worker; 8 million to 10 million temp workers are placed each day worldwide. And they're not just filling in at reception desks. Today, there are temp suppliers for every kind of job, all the way up to CEO. Second, a growing number of businesses are outsourcing their employee relations to professional employee organizations (PEOs)--third-party groups that handle the ever-mounting administrative tasks associated with managing a company's employees. Temps and PEOs free up leaders to focus on the business rather than on HR files and paperwork. But if organizations outsource those functions, they need to be careful not to damage relationships with their people in the process, Drucker concludes.
When it comes time to hire or promote, top executives routinely overvalue certain skills and traits while overlooking others. Intuitively, for example, they might seek out team players, people who shine operationally, dynamic public speakers, or those who are demonstrably hungry for greater responsibility. But some attributes that seem like good indicators of leadership potential are, paradoxically, just the reverse. Team players and those who excel operationally often make better seconds in command. Unfortunately, few organizations have the right procedures in place to produce complete and accurate pictures of their top prospects. Assessments are often based on hearsay, gossip, and casual observation. A new evaluation process will help you avoid that trap. Candidates are assessed by a group of people who have observed their behavior directly over time and in different circumstances.
There was a time when CEOs weren't celebrities, but that was before Jack Welch. Over the past 20 years, Welch, more than any other business leader, has changed the way people view the role of the CEO. There was no General Electric separate from Welch and no Welch separate from General Electric. Through his bold and sweeping reinvention of the company--thanks in no small part to the force of his personality--Welch created the CEO not just as public figure but as icon. Indeed, Welch's legacy and life have been analyzed, lauded, and excoriated by the public and the media alike. Small wonder, then, that his recent book--Jack: Straight from the Gut--has garnered the same degree of publicity. In this frank and wide-ranging interview with HBR senior editors Harris Collingwood and Diane Coutu, Welch replies to his critics and offers a detailed look at his theory and practice of business. Candidly answering questions about his personal style and his upbringing, Welch also gives readers a detailed glimpse of the practices that shape the distinctive GE culture: the meetings, the "deep dives" and, most important, the transmission of powerful ideas throughout GE's far-flung organization.
If you want to understand how much business has changed in the past 50 years, set Alfred P. Sloan's 1963 classic, My Years with General Motors, beside Jack Welch's current bestseller, Jack: Straight from the Gut. Proper, reserved, more Brahmin than baron, Mr. Sloan (never "Al") managed to conceal one of the most creative minds of the first half of the twentieth century beneath a quiet belief in painstaking consensus building. Brash and audacious, a guy's guy, everywhere in the press, Jack (never "Mr. Welch") is the embodiment of the CEO as icon--the epitome of individual star power. But for all their differences, the two are both, essentially, organization men. Sloan invented the concept of the modern corporation; Welch made it work. The question when it comes to Welch is, "How did he do it?" Was it through his oft-publicized strategy of selecting, trusting, and funding the right people and then setting them afloat in a sea of ideas? Or was it through the force of his personality--his preternatural passion, his total dedication to the organization to the exclusion of any private pursuits? In the answer lie the seeds of Welch's legacy. The next generation of CEOs will be quick to emulate the strategy, but not the monomaniacal passion. Nor should they. Tomorrow's leaders, operating in more uncertain times, should seek breadth in their perspectives, openness in their thinking, and roundness in their lives.
Customer relationship management is one of the hottest management tools today. But more than half of all CRM initiatives fail to produce the anticipated results. Why? And what can companies do to reverse that negative trend? The authors--three senior Bain consultants--have spent the past 10 years analyzing customer-loyalty initiatives, both successful and unsuccessful, at more than 200 companies in a wide range of industries. They've found that CRM backfires in part because executives don't understand what they are implementing, let alone how much it will cost or how long it will take. The authors' research unveiled four common pitfalls that managers stumble into when trying to implement CRM. Each pitfall is a consequence of a single flawed assumption--that CRM is software that will automatically manage customer relationships. It isn't. Rather, CRM is the creation of customer strategies and processes to build customer loyalty, which are then supported by the technology. This article looks at best practices in CRM at several companies, including the New York Times Co., Square D, GE Capital, Grand Expeditions, and BMC Software. It provides an intellectual framework for any company that wants to start a CRM program or turn around a failing one.
There's no doubt that companies can benefit from workplace surveys and questionnaires. Good surveys accurately home in on the problems the company wants information about. They are designed so that as many people as possible actually respond. And good survey design ensures that the spectrum of responses is unbiased. In this article, the author, a former research scientist at the University of Michigan and currently the president of a survey design firm, explores some glaring failures of survey design and provides 16 guidelines to improve workplace assessment tools. Applied judiciously, these rules will not only make a tangible difference in the quality and usefulness of the data obtained, but will also produce an increased response rate. The guidelines--and the problems they address--fall into five areas: content, format, language, measurement, and administration. Following the guidelines in this article will help you get unbiased, representative, and useful information from your workplace survey.