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In today's fast-changing competitive environment, strategy is no longer a matter of positioning a fixed set of activities along that old industrial model, the value chain. Successful companies increasingly do not just add value, they reinvent it. The key strategic task is to reconfigure roles and relationships among a constellation of actors--suppliers, partners, customers--in order to mobilize the creation of value by new combinations of players. The authors provide three illustrations of these new rules of strategy. IKEA has blossomed into the world's largest retailer of home furnishings by redefining the relationships and organizational practices of the furniture business. Danish pharmacies and their national association have reconfigured their relations with customers, doctors, hospitals, and drug manufacturers, to enlarge their role, competencies, and profits. French public-service concessionaires have mastered the art of conducting a creative dialogue between their customers--local governments in France and around the world--and a perpetually expanding set of infrastructure competencies.

Time-based competition, which yielded competitive advantage in the mid-1980s, revealed its dark side for many Japanese companies in the early 1990s. In industry after industry, a strategy that was supposed to produce variety ended up producing commodities. Pushing to get a greater number of products out faster, Japanese companies created a plethora of models yet stayed in the same place competitively. Today at least one strong competitor in every Japanese industry is leveraging a powerful combination of time-based competition and customer service. The success of these companies provides at least one crucial managerial lesson: strategy, to be meaningful, must link customer needs with employee capabilities and skills.

In this fictional case study, Adam Lawson is a promising young associate at Kirkham McDowell Securities, a St. Louis underwriting and financial advisory firm. Recently, Adam helped to bring in an extremely lucrative deal, and soon he and a few other associates will be honored for their efforts at the firm's silver anniversary dinner. George Campbell, vice president in mergers and acquisitions, is caught unprepared when Adam tells him that, after serious reflection, he has decided to bring his partner, Robert Collins, to the banquet. George is one of Adam's biggest supporters at the firm, and he personally has no problem with Adam being gay. But it is one thing for Adam to come out of the closet at the office. It is quite another to do so at a public company-client event. George is concerned with how Adam's decision will play with the firm's more conservative clients and senior management. Adam has not come to George for permission to bring Robert to the dinner. But clearly Adam wants some sort of response. Six experts comment on George's dilemma and discuss issues of diversity in the workplace.

McDonald's announces its decision to change from polystyrene "clamshells" for its sandwich packaging to a new paper wrap.

Thoughts on choosing teaching methods and the advantages of the case method for achieving the objectives of a survey course in accounting. Criteria for selecting or preparing good cases, developing a course outline, and for evaluating student and teacher performance.

In the wake of NAFTA, U.S. retail firms begin to see Mexico as an attractive market for international expansion. This case examines the structure of Mexico's volume retail (grocery, discount, warehouse club, hypermarket) industry, the joint ventures between U.S. and Mexican firms, and the prospects for the future.

Considers a Pakistani company's decision to conduct a joint venture with a foreign multinational. In 1987, Milkpak Ltd. had successfully developed a market for sterilized milk and wanted to produce other value-added food products. The company was evaluating the best means for increasing its success in the Pakistani market and conducted negotiations with alternative joint venture partners.

COMCO Martech was a new breed of joint venture for COMCO Holding, a mid-sized Swiss-German company that had grown over a five-year period through tie-ups with small, start-up companies. Whereas a typical COMCO venture provided services to a large German retailer, was based in a German-speaking country of Europe, and granted COMCO Holding clear management control, COMCO Martech was managed on a 50-50 basis with an American partner, was active in Eastern Europe, and supplied decontamination services to non-retail related clients. The venture got off to a rocky start. This case looks at the difficulties that arise in managing cross-boundary collaboration; the characteristics that promote compatibility between partners; and the factors that account for successful international partnerships.

A private company is considering an introduction of a long-run incentive compensation system in which payoffs to managers are determined by the economic value added for shareholders by their individual business units. The proposed new system is compared to a number of earlier incentive schemes utilized by the firm.

Spreadsheet Supplement for case 293091

Spreadsheet Supplement for case 293135

Top management of Univisa, the North American subsidiary of the Mexican media conglomerate Televisa, meet to determine how to pursue opportunities to serve the Spanish-speaking population in North America. They must determine how to relate Univisa's market penetration strategy in North America to the broader global expansion strategy of Televisa.

Management is debating a proposal to capitalize R&D. While Swedish GAAP permits capitalization, the general practice is to expense R&D as incurred.

Spreadsheet Supplement for case 193166

Bajaj Auto Ltd., the world's second-largest manufacturer of two- and three-wheeler vehicles, is facing increasing competition in its domestic Indian market. The case evaluates appropriate marketing responses both in the Indian market and export markets.

David Melcher contemplates changing his career at midlife.

This case describes Pepsico's program to restructure its Mexican bottling network. It wants to work with existing bottlers and find an organizational arrangement that will allow the bottlers to grow and change with the Mexican soft drink industry.

Spreadsheet Supplement case for 293137

Spreadsheet Supplement for case 193159

Cummins Engine Co. is starting up production of diesel engine crankshafts in its plant in central Mexico. This operation requires much tighter tolerances than any product previously produced at the plant, and the young (recent MBA) manager who is in charge of the start-up is faced with several difficult decisions regarding the equipment to be used for crankshaft machining in Mexico. On the one hand, some of the equipment used for this purpose in Cummins' U.S. plant is inappropriate in the Mexican context. On the other, he has to operate under severe budgetary and supplier constraints. A subsidiary issue has to do with the long-term strategy for the Mexican plant, which has developed into one of the best in Cummins' worldwide network but risks being fragmented by the many opportunities for adding products that are available to it.