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Cardiac surgery is one of medicine's modern miracles. In an operating room no larger than many household kitchens, a patient is rendered functionally dead while a surgical team repairs or replaces damaged arteries or valves. Each operation requires incredible teamwork--a single error can have disastrous consequences. In other words, surgical teams are not all that different from the cross-functional teams that have become crucial to business success. The challenge of team management these days is not simply to execute existing processes efficiently. It's to implement new processes as quickly as possible. But adopting new technologies or new business processes is highly disruptive, regardless of the industry. The authors studied how surgical teams at 16 major medical centers implemented a difficult new procedure for performing cardiac surgery. The setting was ideal for rigorously focusing on how teams learn and why some learn faster than others. The authors found that the most successful teams had leaders who actively managed the groups' learning efforts. Teams that most successfully implemented the new technology shared three essential characteristics. They were designed for learning; their leaders framed the challenge so that team members were highly motivated to learn; and an environment of psychological safety fostered communication and innovation. The finding that teams learn more quickly if they are explicitly managed for learning poses a challenge in many areas of business. Team leaders in business tend to be chosen more for their technical expertise than for their management skills. Team leaders need to become adept at creating learning environments, and senior managers need to look beyond technical competence and identify leaders who can motivate and manage teams of disparate specialists.

Given explosive growth in technologies for drug discovery, how does Merck remain competitive in an industry that is fragmented and continues to consolidate?

Heartport, an entrepreneurial medical device maker, has introduced several innovative systems for conducting less-invasive cardiac surgery. Despite initially high expectations, the company has struggled to get its technology adopted by cardiac surgeons. The company's newest CEO, the third in less than four years, must figure out how to turn around the fledgling company. This case describes Heartport's method of performing minimally invasive cardiac surgery as well as rival techniques for treating cardiovascular disease. Describes the evolution of the company, its product strategy, and its fortunes over the period 1991-99.

Examines the market-entry strategy of a medical device company.

Presents evidence on the unsustainability of many competitive advantages, reviews the typical threats to the sustainability, and discusses ways in which those threats can be combatted.

Traces Intel's history and strategy from 1968 to 1997. Examines the company's decision to exit DRAMS and its entry into microprocessors. Focuses on how the company managed to achieve and sustain its competitive advantage in microprocessors, and the threats it faces in the future.

Explores the challenges confronting the CEO at the Brigham and Women's Hospital in the wake of radical changes in the health care environment. As pressures have risen for cost containment in health care, the hospital has embarked on a series of reengineering efforts to reduce costs, while maintaining the quality of care. The CEO is now evaluating the results of these efforts and considering alternative strategies for improvement.

Examines CIBA Vision's decision on whether to launch a major new R&D initiative to develop a low-cost, daily disposable contact lens, and how to organize such a project should it proceed. One group of executives favors setting up a small, autonomous project team organizationally and geographically isolated from the company's existing R&D operations. This approach will enable focus, but poses serious issues concerning future integration.

Portrays the dilemma faced by Marsh Carter, CEO and chairman of the board of State Street Bank, in May 1995. For the past decade, the bank earned continually expanding earnings through its rapidly growing custody business. Now, as that business matures and custodial fees erode, Carter is seeking to expand the bank's presence in higher value-added financial services. Developing these will require the bank to build new sets of organizational capabilities to leverage and integrate skills located in different divisions of the bank.

Focuses on the decision confronting senior administrators at the Brigham and Women's Hospital: whether to enter into an affiliation with the Massachusetts General Hospital. Requires students to analyze the complex institutional changes in the health environment and to determine how the proposed affiliation might influence the hospital's chances for successfully carrying out its core missions.

Few managers of high-technology companies view manufacturing as a primary souce of competitive advantage. Indeed, companies in high-tech industries increasingly outsource manufacturing completely. In so doing, they hope to avoid the risks of investing in expensive manufacturing plants and losing sight of what they see as their true source of advantage: product research and development. The authors' research in the health care industry over the past decade suggests that such thinking is often costly and potentially dangerous to the competitive health of high-tech companies. In fact, it is not only possible but also necessary to excel at developing new products and new manufacturing processes simultaneously. In many high-tech markets in which product technology is rapidly evolving, manufacturing process innovation is becoming an increasingly critical capability for product innovation.

Grant Newman, CEO of Regional Medical Center (RMC), expected the worst from the meeting that was scheduled to begin in less than an hour. The anesthesiologists were at the end of their rope, and the hospital's surgeons and obstetricians were pretty riled up too. Eighteen months earlier, Newman had made the decision to outsource RMC's anesthesia services, and he had signed a contract with Physicians Development Services (PDS), a contract management company. At the time, PDS seemed a good fit. It had a reputation for providing high-quality physicians both on a permanent basis and for temporary assignments. Unfortunately, however, PDS was undercapitalized and chronically mismanaged. PDS's paychecks to the anesthesiologists began arriving late and then bounced several times over a three-month period. In addition, the contract between the anesthesiologists and PDS had expired three months earlier, and the anesthesiologists were providing services without a contract. What can Newman do to resolve this conflict? In 95309 and 95309Z, Ken Alvares, Anthony R. Kovner, Joellin Comerford, Rudy Puryear, Vaughn Hovey, Tom Chapman, and Gary P. Pisano offer advice on this fictional case study.

Grant Newman, CEO of Regional Medical Center (RMC), expected the worst from the meeting that was scheduled to begin in less than an hour. The anesthesiologists were at the end of their rope, and the hospital's surgeons and obstetricians were pretty riled up too. Eighteen months earlier, Newman had made the decision to outsource RMC's anesthesia services, and he had signed a contract with Physicians Development Services (PDS), a contract management company. At the time, PDS seemed a good fit. It had a reputation for providing high-quality physicians both on a permanent basis and for temporary assignments. Unfortunately, however, PDS was undercapitalized and chronically mismanaged. PDS's paychecks to the anesthesiologists began arriving late and then bounced several times over a three-month period. In addition, the contract between the anesthesiologists and PDS had expired three months earlier, and the anesthesiologists were providing services without a contract. What can Newman do to resolve this conflict? In 95309 and 95309Z, Ken Alvares, Anthony R. Kovner, Joellin Comerford, Rudy Puryear, Vaughn Hovey, Tom Chapman, and Gary P. Pisano offer advice on this fictional case study.

Describes the decision made on the 7-Series project with respect to prototyping and its impact on quality.

ITT Automotive is in the process of developing a new-generation antilock brake system (ABS), designated the MK-20. The case focuses on the level of automation to be used in the production of this new system, and whether all plants should use the same process technology. Due to intensifying cost pressure and rapidly growing demand for lower-cost ABS, the development team and senior management (based in Frankfurt, Germany) strongly favor using a single, highly automated production process in the four plants scheduled to produce the MK-20 (located in Germany, Belgium, and the United States). Managers at the company's two plants in the United States favor using less automation technology in order to allow greater flexibility for improving process technology over time.

In 1993, Eli Lilly is preparing to build manufacturing capacity for three new pharmaceutical products that it expects to launch in 1996. Management wrestles with a decision of whether to add specialized manufacturing capacity or flexible capacity. This question touches off a broad debate within the company about which strategy to follow for future facilities decisions. This case presents two alternatives (flexible and specialized plants) and describes the benefits and costs associated with each.

Virtually all manufacturers aspire to "world-class" status. But even those who attain it will only be as good as their toughest competitors. This explains why so many companies that have adopted improvement programs like just-in-time, lean production, and total quality management lament that they never seem to get ahead. The problem is that managers tend to view such programs as solutions to specific problems, like high inventories or products that are difficult to manufacture. As such, they are not manufacturing strategies. In the turbulent 1990s, the goal of competitive strategy should be strategic flexibility. A company must be able to switch gears relatively quickly and with minimal resources. A true manufacturing strategy is a plan for developing the skills and capabilities that will enable a company to do certain things better than competitors over the long haul.

Applichem manufactures the same chemical product in four plants, each of which is located in a different country. The company has completed a major study comparing the productivity and performance of these plants. Using the data from the study, students must decide which, if any, plants to close. The case requires students to think about the relevant metrics for comparing the performance of plants that operate very differently and in different countries. An important issue is the distinction between physical measures of productivity and financial measures of performance. Finally, the case allows students to think about what management might do to ensure that productivity improvements are shared across the plant network.

Spreadsheet supplement for case 693-035.

American Connector Co. is forced to reexamine operations at its Sunnyvale plant when a Japanese competitor announces plans to build an "ultimate" plant in the United States. Case examines issues related to benchmarking a competitor's manufacturing capabilities and productivity. Allows students to compare two companies' manufacturing strategies and their implications for productivity and flexibility.