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This case introduces the concept of customer centricity and traces its development at EMC, the world's leading data storage hardware and information management software company. EMC's customers had historically relied on EMC salespeople to guide them through the complex, consultative buying process. However, with the rise of social media, prospective customers are getting more of the information they require earlier in the purchase process online. As they do so, their physical interactions with EMC salespeople are decreasing, while their digital interactions are increasing. Given the changing business environment, BJ Jenkins, senior vice president of Global Marketing, faces significant challenges as he tries to maintain EMC's culture of customer centricity. These include 1) translating EMC's platinum service levels, designed to appeal to the world's largest companies, to small businesses and B2C customers, 2) understanding how the replacement of physical interaction with digital interaction in the consultative selling process affects EMC's business, and 3) managing a VAR sales model that distances EMC from its customers.

Porcini's Inc. operates a chain of 23 full-service restaurants located near shopping malls and downtown areas in the northeastern United States. Known for providing excellent service, Porcini's serves high-quality Italian cuisine made from fresh ingredients. Looking for expansion opportunities, management considers launching a new chain of lower-cost, limited-menu restaurants called Porcini Pronto. The new outlets will be located along busy interstate highway exits in the region and will serve outstanding Italian food at reasonable prices to both travelers and local residents. Management is concerned that a poor customer experience at Porcini Pronto could tarnish the company's well-established and successful restaurant brand. The management team asks the vice president of marketing to develop the concept and to create an operating strategy for the new outlets. The VP must also analyze three alternative expansion strategies before management will make any commitments to the project. If Porcini's builds and operates the new restaurants, the company will maintain complete control of operations and the customer experience but expansion will take a very long time. Franchising and syndication are two other options which provide faster expansion but introduce the risk of losing control of the brand. The VP must analyze the options and make his final recommendation.

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Eisai has used knowledge creation as the engine of growth for its operation in Japan and was wondering if it can be utilized on a global scale.

This case poses the question: given what was known at the time of its adoption, in February 2009, was the federal Health information Technology for Economic and Clinical Health Act good public policy? The HITECH Act, included in President Barack Obama's federal stimulus bill, was intended to introduce major incentives to encourage the spread of heath information technology throughout the U.S. health system. The case is ideal for a policy analysis class. The case assumes no special knowledge of the health care system or information technology, and provides students with several categories of background information: * The central criticisms of the US health system, and why health IT proponents thought health IT was an essential ingredient in solving these problems. * Evidence that use of health IT in the United States lagged behind (1) the health care systems of other industrialized nations and (2) the use of IT in other information-heavy US industries. * The reasons health care providers were not, on their own, investing in health IT at the level advocated by proponents. * Mixed evidence as to the advantages of health IT for US health care providers that had already adopted it. * The history of federal action (administrative and legislative) on health IT as of February 2009 and arguments, pro and con, for a more aggressive federal role. * A summary of the HITECH Act as proposed by the Obama Administration. The case equips students to stand in the shoes of Congressional decision-makers (or their advisers) in February 2009, and argue why they might either support or oppose this piece of legislation. The case may be used on its own. It may also be used as the first part of a two-case unit with HKS Case 1938.0, "B. Inciting a Computer Revolution in Health Care: Implementing the Health Information Technology Act." HKS Case Number 1937.0.

This case, ideal for strategic leadership classes, poses the question: given the ambitious goals of the 2009 Health Information Technology for Economic and Clinical Health (HITECH) Act and the hurdles to its successful implementation, how should incoming National Coordinator for Health Information Technology David Blumenthal proceed? The case describes Blumenthal's resources, most notably: *$27 billion in Medicare and Medicaid incentives to hospitals, physicians, and other eligible providers who invested in ""certified"" electronic health systems *$2 billion in other funds to address specific obstacles to widespread acquisition of health IT systems. *Broad regulatory authority to define ""meaningful use"" and set certification criteria. It also describes Blumenthal's major challenge: to persuade thousands of hospitals and hundreds of thousands of doctors that health IT systems were worth the time and trouble it would take to buy them and integrate them into daily clinical practice. Small, cash-strapped community hospitals and individual practitioners constituted a particular concern. Finally, it describes the nature of Blumenthal's regulatory task: to define meaningful use quickly and to strike the right balance. Define meaningful use too strictly, and large numbers of health care providers might turn down the proffered incentives. Define it too loosely, and the expensive federal initiative would deliver little more than the market would have produced anyway. The case may be used on its own. It may also be used as the second part of a two-case unit with HKS Case 1937.0. This case includes an 8:00 min. video where David Blumenthal talks about challenges he faced, in particular when dealing with individual practitioners who didn't have the bandwidth to adopt electronic health records. Blumenthal explains the arguments he used to persuade them, and reflects more broadly on the timing and stages of this transition to "get information flowing in the healthcare system.

Veteran product launch PR executives Joan Schneider and Julie Hall examine the five most frequent reasons why new products flop: The company can't support fast growth, the product falls short of claims and gets bashed, the item exists in "product limbo," the product defines a new category and requires substantial consumer education but doesn't get it, and the product is revolutionary but has no market. The authors describe real-world examples of each kind of failure and suggest how companies can avoid these pitfalls.

It's one of the most basic aphorisms of business: The customer is always right. But when companies, especially large ones, try to rectify a service failure, they may run into opportunistic customers who try to take advantage of the situation. Treating customers justly can allow companies to settle grievances without giving in to over-the-top demands, the author finds. He argues that companies should do three things to resolve complaints without being exploited: ensure that compensation is fair, provide a convenient claims process, and express friendliness and concern. They should also offer any compensation promptly, which is apt to lessen excessive demands and leave customers feeling more satisfied.

Company founders have to be optimistic and resilient. But new research shows that serial entrepreneurs-those who involve themselves in only one project at a time-tend to be so overoptimistic that they don't learn from failure. Some venture capitalists factor this in when making investment decisions, and they tend to have better results than those who don't. Other potential investors should perform this due diligence, interviewing candidates about the causes of their past successes and mistakes.

An assistant professor at the University of Kentucky examines the similarities between people's responses to physical pain and their responses to social rejection, including the surprising finding that taking acetaminophen decreases hurt feelings.

One difference between winners and losers is how they handle losing. Even a winning team might make mistakes, fumble, and lag behind before the game is over. But it recovers quickly and gets back on course. Kanter's Law is "Anything can look like a failure in the middle." The culture that surrounds high performers helps them resist the behaviors that losing can produce: panicking and throwing out the game plan; scrambling for self-protection and abandoning the rest of the group; hiding the facts and hoping things will get better by themselves; denying that anything needs to be learned or changed. Performance under pressure is the key.

Daniel Isenberg on why "embracing failure" to encourage entrepreneurship is bad policy.

Efforts to bring clean water to Bangladesh by installing tube wells appeared to be a huge success, but over time they led to epic failures: widespread arsenic poisoning, a rise in crime and prostitution, a projected increase in diarrheal diseases as villagers resume using groundwater.

When John Antioco joined Blockbuster in 1997, outsiders were predicting that the bricks-and-mortar video rental business would be killed off by market shifts and technological advances. But he believed the company could remain relevant. First he needed to revise Blockbuster's business model, which was built on buying individual VHS cassettes at a hefty price and then struggling to rent each one about 30 times to make back the money. Antioco's team persuaded the movie studios to shift to a revenue-sharing system. Then the company jumped into the online business and eliminated its late fees, which had been a major customer irritant. Five years into Antioco's tenure, Blockbuster's revenues had nearly doubled. Enter Carl Icahn, activist shareholder, who had his own ideas about how Blockbuster should be managed and particularly about Antioco's compensation package. Icahn launched a successful proxy fight and secured seats on the board for himself and two others, putting Antioco on the defensive over his strategies for growth. The situation finally came to a head in a boardroom dispute over Antioco's bonus-resolved by his departure six months later. Three years after that, Blockbuster filed for bankruptcy. Icahn's version of events appears in a sidebar to the article.

Many executives believe that all failure is bad (although it usually provides lessons)-and that learning from it is pretty straightforward. The author, a professor at Harvard Business School, thinks both beliefs are misguided. In organizational life, she says, some failures are inevitable and some are even good. And successful learning from failure is not simple: It requires context-specific strategies. But first leaders must understand how the blame game gets in the way and must work to create an organizational culture in which employees feel safe admitting or reporting on failure. Failures fall into three categories: preventable ones in predictable operations, which usually involve deviations from spec; unavoidable ones in complex systems, which may arise from unique combinations of needs, people, and problems; and intelligent ones at the frontier, where "good" failures occur quickly and on a small scale, providing the most valuable information. Strong leadership can build a learning culture-one in which failures large and small are consistently reported and deeply analyzed, and opportunities to experiment are proactively sought. Executives commonly and understandably worry that taking an understanding stance on failure will create an "anything goes" work environment. They should instead recognize that failure is inevitable in today's complex work organizations.

Companies are spending a great deal of time and money to install codes of ethics, ethics training, compliance programs, and in-house watchdogs. If these efforts worked, the money would be well spent. But unethical behavior appears to be on the rise. The authors observe that even the best-intentioned executives may be unaware of their own or their employees' unethical behavior. Drawing from extensive research on cognitive biases, they offer five reasons for this blindness and suggest what to do about them: (1) Ill-conceived goals may actually encourage negative behavior. Brainstorm unintended consequences when devising them; (2) Motivated blindness makes us overlook unethical behavior when remaining ignorant is in our interest. Root out conflicts of interest; (3) Indirect blindness softens our assessment of unethical behavior when it's carried out by third parties. Take ownership of the implications when you outsource work; (4) The slippery slope mutes our awareness when unethical behavior develops gradually. Be alert for even trivial infractions and investigate them immediately; and (5) Overvaluing outcomes may lead us to give a pass to unethical behavior. Examine good outcomes to ensure they're not driven by unethical tactics.

What causes so many companies that once dominated their industries to slide into decline? In this article, two Harvard Business School professors argue that such firms lose their touch because success breeds failure by impeding learning at both the individual and organizational levels. When we succeed, we assume that we know what we are doing, but it could be that we just got lucky. We make what psychologists call fundamental attribution errors, giving too much credit to our talents and strategy and too little to environmental factors and random events. We develop an overconfidence bias, becoming so self-assured that we think we don't need to change anything. We also experience the failure-to-ask-why syndrome and neglect to investigate the causes of good performance. To overcome these three learning impediments, executives should examine successes with the same scrutiny they apply to failures. Companies should implement systematic after-action reviews to understand all the factors that led to a win, and test their theories by conducting experiments even if "it ain't broke."

It's hardly news that business leaders work in increasingly uncertain environments, where failures are bound to be more common than successes. Yet if you ask executives how well, on a scale of one to 10, their organizations learn from failure, you'll often get a sheepish "Two-or maybe three" in response. Such organizations are missing a big opportunity: Failure may be inevitable but, if managed well, can be very useful. A certain amount of failure can help you keep your options open, find out what doesn't work, create the conditions to attract resources and attention, make room for new leaders, and develop intuition and skill. The key to reaping these benefits is to foster "intelligent failure" throughout your organization. McGrath describes several principles that can help you put intelligent failure to work. You should decide what success and failure would look like before you start a project. Document your initial assumptions, test and revise them as you go, and convert them into knowledge. Fail fast-the longer something takes, the less you'll learn-and fail cheaply, to contain your downside risk. Limit the number of uncertainties in new projects, and build a culture that tolerates, and sometimes even celebrates, failure. Finally, codify and share what you learn. These principles won't give you a means of avoiding all failures down the road-that's simply not realistic. They will help you use small losses to attain bigger wins over time.

Lafley, the former CEO of Procter & Gamble, is regarded as one of the most successful chief executives in recent history. But like everyone else, he's had his share of mistakes. Politicians and winning sports teams draw their biggest lessons from their toughest losses, he says, and the same has been true for him. The company learned more from its failed new brands and products than from its successes. Among Lafley's favorite examples is the color-safe low-temperature bleach that P&G test launched in the 1980s under the brand name Vibrant. It chose Portland, Maine, as the test market, hoping to escape notice from Clorox, which was headquartered in Oakland, California. But Clorox got wind of the plan in time to distribute free gallons of Clorox to every household in Portland, making all P&G's advertising dollars, sampling, and couponing irrelevant. "Game, set, match to Clorox," Lafley says. But the good technology behind Vibrant remained, and when, a few years later, Clorox tried to enter the laundry detergent business, P&G modified that technology to create Tide with Bleach, which grew into a business worth more than half a billion dollars. Lafley also talks about systematically analyzing 30 years' worth of failed acquisitions to uncover five root causes: no winning strategic reason for the acquisition; integrating poorly or too slowly; expecting synergies that didn't materialize; incompatible cultures; company leaders who "couldn't play together in the same sandbox." That analysis led to changes that informed P&G's highly successful acquisition of Gillette in 2005.

Most business failures-such as engineering disasters, product malfunctions, and PR crises-are foreshadowed by near misses, close calls that, had luck not intervened, would have had far worse consequences. The space shuttle Columbia's fatal reentry, BP's Gulf oil rig disaster, Toyota's stuck accelerators, even the iPhone 4's antenna failures-all were preceded by near-miss events that should have tipped off managers to impending crises. The problem is that near misses are often overlooked-or, perversely, viewed as a sign that systems are resilient and working well. That's because managers are blinded by cognitive biases, argue Georgetown professors Tinsley and Dillon, and Brigham Young University's Madsen. Seven strategies can help managers recognize and learn from near misses: They should be on increased alert when time or cost pressures are high; watch for deviations in operations from the norm and uncover their root causes; make decision makers accountable for near misses; envision worst-case scenarios; be on the lookout for near-misses masquerading as successes; and reward individuals for exposing near misses.