CEOs who are hired from outside the company tend to get far more attention, not to mention support with the transition to their new role, than CEOs promoted from the inside do. Leaders who come from within the firm, it's assumed, already know the organization, its strategy, and its management, so they should adjust easily to their new roles. But in reality, they face hurdles that are just as big, albeit different, from the ones outsider CEOs face. In their research and consulting work, the authors have identified insiders' five key challenges: operating in the shadow of their own past; making early decisions that surprise and disappoint supporters; overseeing former peers; pacing change; and managing the outgoing CEO. In this article, they draw on interviews with dozens of internally promoted executives to provide advice for navigating each of those issues. The result is a primer for leaders who step into the top job from within; the management teams, boards, and HR and communication departments that want to offer support; and even leaders lower down in the hierarchy who are dealing with succession issues.
When customers seek out online deals, it seems like a win for everybody: Brands, retailers, dealers, and distributors sell more goods, and buyers get a bargain. What's not to like? Here's the problem: Lured by rock-bottom online prices, customers often end up dealing with disreputable digital resellers that mistreat them, which can erode brand equity and undermine authorized sellers. For brands selling in the United States and Canada, there is a potent countermeasure: crafting and enforcing pricing policies that discourage anyone from advertising or selling a firm's products at an unauthorized discount. This article lays out the four steps essential to designing and enforcing policies with teeth that stay on the right side of antitrust law.
Increasingly, multinational corporations (MNCs) are pledging to procure the materials and services they need from companies committed to fair labor practices and environmental protections. But the reality is that their suppliers--especially those at low levels of the chain--often violate sustainability standards, exposing MNCs to serious financial and social risks. To explore this problem--and identify solutions--the authors studied the supply networks of three MNCs deemed to be sustainability leaders. These companies engage in behaviors that are worth emulating; for example, they have established long-term sustainability goals, and they try to cascade good practices all the way down to lower-tier suppliers, using a combination of direct, indirect, industrywide, and global strategies. But all MNCs have more work to do to develop sustainable supply networks. They must emphasize social and environmental responsibility, along with economic considerations, at every level of the supply chain. They must give their procurement officers better training and incentives to pursue supplier sustainability. And to encourage widespread dissemination of best practices, they need more direct contact with the procurement people at their first-tier suppliers.
PepsiCo is among the few global, established companies that have delivered superior financial performance while meeting the needs of all stakeholders. It has always invested for the long term and delivered results in the short term. The layer that author Indra Nooyi added, first as SVP for corporate strategy and then as CEO, was a focus on sustainability--defined here as satisfying multiple stakeholder interests to ensure the long-term viability of a company. Called Performance with Purpose (PwP), it is based on four pillars: delivering superior financial returns (financial sustainability); transforming the product portfolio by making more-healthful, more-nutritious foods and beverages while reducing the sugar, salt, and fat in PepsiCo products (human sustainability); limiting environmental impact by conserving water and reducing the company's carbon footprint and plastic waste (environmental sustainability); and lifting people up by offering new types of support to women and families inside the company and in the communities it serves (talent sustainability).
In theory, companies create value for stakeholders by making risky investments. In practice, however, managers in large corporations routinely quash risky ideas in favor of marginal improvements, cost-cutting, and "safe" investments. Why are managers in large, hierarchical organizations so risk-averse? Corporate incentives and control processes actively discourage managers from taking risks. Whereas CEOs consider each investment in the context of a greater portfolio, managers essentially bet their careers on every investment they make--even if outcomes are negligible to the corporation as a whole. This article explains how loss aversion works, presents an analysis of just how much value manager attitudes toward investment risk leave on the table, and offers suggestions for changes in practices and systems.
Trans people often experience stigma and discrimination, hostility from others, and pressure to "manage" their identities in social settings, including the workplace. These experiences can set in motion a host of psychological responses that have devastating consequences for trans individuals' job satisfaction, turnover intentions, and emotional well-being. Despite growing public awareness of the struggles that trans individuals often face, many employers remain ill-equipped to create policies and workplace cultures that support their trans employees. Fortunately, a growing body of research suggests how they can more effectively attract, retain, and promote the health and success of these workers. Interviews with and surveys of more than 1,000 trans people over the past six years reveal four key areas of intervention that can cultivate a more trans-inclusive workplace: (1) basic signs of trans inclusivity involving bathroom use, dress codes, and pronouns; (2) effective support for gender transitions; (3) trans-specific diversity trainings; and (4) interventions to build resiliency.
Technology start-ups typically become successful by using injections of capital to grow as rapidly as possible and tolerating high risk in a rush for market domination. Entrepreneurs far from superstar innovation cities demonstrate that start-ups can achieve outsize success by following a different path. Frontier start-ups take a more balanced approach to growth, build resiliency into their models, and take a long-term outlook. In emerging markets, they are more likely to tackle fundamental societal challenges and to invest in their workforce.
The author, chairman of JetBlue and an adjunct professor at Stanford, has fired plenty of people during his long career--and he's been fired himself. In this article he outlines an empathetic approach in which the manager recognizes that he or she played a role in the employee's failure to perform--and that this difficult conversation, which should not be outsourced to the HR department, is something a manager should strive to handle well. The person you're firing today could become a key contact at a supplier or a client tomorrow. Peterson offers specific steps--and mistakes to avoid--to help this tricky process go as smoothly as possible: (1) Don't wait for a "firing offense." (2) Do be willing to fire friends or family. (3) Don't surprise people. (4) Do prepare and practice. (5) Don't hand off the dirty work. (6) Do deliver the message immediately and clearly. (7) Don't overexplain the decision. (8) Do be human. (9) Don't shift the blame. (10) Do be generous.
A young social entrepreneur must decide whether to stick with her struggling start-up--a tomato paste company based entirely in Nigeria--or go to work for an investment group that funds small businesses in Africa. Where would she have the most impact? This fictional case study by Sophus A. Reinert features expert commentary by Acha Leke and Mira Mehta.
Dean Koontz is one of the world's most prolific and best-selling writers, with more than 120 novels to his name. During a difficult childhood, books were his refuge, so he has devoted his life--from 6:30 am to dinnertime, six days a week, for the past five decades--to creating fictional worlds across a range of genres for his devoted readers.
A young social entrepreneur must decide whether to stick with her struggling start-up--a tomato paste company based entirely in Nigeria--or go to work for an investment group that funds small businesses in Africa. Where would she have the most impact? This fictional case study by Sophus A. Reinert features expert commentary by Acha Leke and Mira Mehta.
A young social entrepreneur must decide whether to stick with her struggling start-up--a tomato paste company based entirely in Nigeria--or go to work for an investment group that funds small businesses in Africa. Where would she have the most impact? This fictional case study by Sophus A. Reinert features expert commentary by Acha Leke and Mira Mehta.
The case describes the management style of Philipp Schindler, Google's Chief Business Officer, and the programs and organizational structures he implemented to promote innovation within Google's business organization.
In December 2019, Scoot, the low-cost carrier (LCC) launched by Singapore Airlines Limited in 2011, had successfully established itself in the Asian market, having flown over 65 million passengers to 68 destinations with a fleet of 48 aircraft. Scoot accounted for 14 percent of seat capacity in Singapore, and 43 percent of LCC capacity out of the country. In 2016, SIA fully acquired and integrated the local LCC Tigerair into Scoot. Scoot's growth, along with the integration of Tigerair, enabled SIA to compete for price-sensitive leisure travelers on short- and medium-haul routes, particularly within Asia, and premium passengers on medium- and long-haul routes. Scoot had been essential to building network connectivity within Asia and allowing SIA to compete effectively with competitors entering the market. Reflecting on Scoot's evolution from 2011 to 2019, Goh Choon Phong, CEO of Singapore Airlines Limited felt that the SIA Group had succeeded in fulfilling its strategic intent of being invested and a market leader in both the full-service and low-cost markets. He contemplated the opportunities and challenges ahead for SIA. Because Scoot operated many places where the full-service airline did not fly, Goh thought that SIA could gain tremendously by making connections between flights by Singapore Airlines, Scoot, and SilkAir-the airline's short-to-medium haul premium subsidiary-as seamless as possible. But there were challenges as well, since Scoot provided different service levels and had been established and run with a high level of autonomy. Goh explained, "There are different expectations between the full service and the LCC if there are any delays. But when you are connecting the two of them, how do you manage the expectations? These are all things that we are still learning. But we are determined, and we think it can be resolved. We are just right at the front of the learning curve."
In 2014, Lindsay Jurist-Rosner (MBA '09) founded Wellthy, a B2C business that coordinates care for working professionals seeking help to support loved ones with chronic diseases or aging parents. With personal experience as a young professional providing care for her mother, Jurist-Rosner spotted an opportunity, given the long-term demographic trends in the United States. As she raised capital, built out a technology platform and recruited a team of care coordinators, Wellthy's growth remained slow until she piloted a B2B product with the Hearst Company. Jurist-Rosner wondered whether Wellthy should fully pivot from B2C to B2B, how fast she should ramp up the recruitment of care coordinators, and as she looked to raise another round of capital, whether she should position Wellthy as a B Corporation delivering social impact alongside commercial returns.
In December 2019, Atabek Nazirov, head of Uzbekistan's capital market regulatory agency, prepared the release of Uzbekistan's capital market strategy. As Nazirov was getting ready to release the strategy, he reflected on the first year of his tenure and the steps ahead. Did he take the right actions to strengthen Uzbekistan's capital market? What additional features would the capital market need to build trust with both the citizens of Uzbekistan and international investors? How could he convince the critics within the administration that his focus on a market-based economy would serve Uzbekistan best? And how could he deliver quick results to retain the president's support?
The owner of Dunlop Livery Antiques in Dunlop, Ontario was considering a comprehensive marketing strategy with a focus on digital marketing. The industry was changing, popularity was wavering, sales were falling, and distribution channels were shifting. A new strategy was needed to increase revenue, profit, and brand awareness in the shrinking industry. Several placement choices were available, including selling online or at trade shows. A promotion plan also needed to be developed and implemented, which included advertising options such as Instagram and magazines. He needed to catch up with the competition in terms of promotion and distribution. With retirement looming, he had to make some tough choices—how could he promote and improve sales to ensure the future success of his antique business?
In October 2017, the managing director at Ohtani Capital faced a critical decision—should the company divest its long-term investment in Toshiba Corporation (Toshiba)? Recent events surrounding Toshiba's disagreement with its auditor over how to best report the writedown of its US nuclear power unit (Westinghouse Electric Co. LLC) had negatively impacted the company’s profitability and internal management, leading to the company’s possible delisting from the Tokyo Stock Exchange. The managing director needed to decide if Toshiba could overcome its difficulties, improve its internal management, and return to profitability, which would then enable the company to secure the necessary emergency funding to survive.
In March 2019, entrepreneur Greg Pahl was contemplating the next steps for Medicine Hat Meat Traders; the past year was the company’s best in terms of beef jerky sales. Should Pahl keep the business running at its current state while focusing on streamlining the operations to realize some additional profits? Should he consider a partial expansion that would allow for a potential increase in sales? Or should he build or lease a new facility that would allow production to be tailored for current use and future expansion while also adding new product lines? Was there another option that Pahl had not yet identified? What were the risks and benefits of each of the options, and how could they influence Pahl’s decision?