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  • Hewlett-Packard Company: CEO Succession in 2010

    Mark Hurd resigned as the CEO of Hewlett Packard in 2010 after the board discovered that he had misfiled expense reports and paid an H.P. contractor for unsubstantiated work. After Hurd left H.P., he joined Oracle, an H.P. competitor. Soon thereafter, the H.P. board appointed a new CEO following an eight-week search.
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  • Walmart's Sustainability Strategy (B): 2010 Update

    In 2007, Walmart launched a new business strategy designed to meet three sweeping and aggressive environmental goals set by CEO Lee Scott: (1) to be supplied 100 percent by renewable energy; (2) to create zero waste; and (3) to sell products that sustain people and the environment. The initiation of this new approach to managing the company's extended supply chain is the subject of OIT-71A. In OIT-71B, the authors provide an update on Walmart's sustainability strategy, three years after the original case was written. In addition to outlining the progress made in the three sustainable value networks profiled in the A case (textiles, seafood, and electronics), the B case also describes how the company is strengthening, modifying, or abandoning the new supply chain management practices it adopted in 2007. It also touches on some of the company's new sustainability initiatives, including Walmart's 2010 GHG goal, the globalization of the network approach, and new measurement programs (e.g., GreenWERCS and the sustainability consortium).
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  • Siemens: Building a Structure to Drive Performance and Responsibility (A)

    Peter Löscher became CEO of Siemens in July, 2007. It was one of the most turbulent times in the company's history as the company was reeling from a compliance scandal involving hundreds of millions of Euros in suspected bribes, and had to pay billions of Euros in fines and fees to clear its name. Further, the company's operating groups were underperforming their peers in terms of profitability, and had been for some time. Adding to the challenges, Löscher was the first outsider to run Siemens since the company's founding in 1847. After his arrival, Löscher moved quickly to assess the organization, a global, multi-line technology and engineering firm with over 475,000 employees and over €66,487 million of revenue and €3,345 million of net income. Klaus Kleinfeld, the previous CEO, had improved company performance, driven the company to become more globally focused, and sold off underperforming and non-core assets. However, his tenure was cut short by the bribery scandal. When Löscher arrived, he felt the company was overly complex, individuals lacked accountability and significant tension existed between headquarters and the regions. Löscher took advantage of the crisis to reorganize the company from 10 operating groups to 3 sectors, introduce regional clusters to enable smaller markets to focus on sales, establish the "right of way" of the global business, simplify financial reporting, and enhance the sales effort to market verticals. In addition to the changes that Löscher made to the company structure, he transformed employees' attitudes and renewed the entrepreneurial and innovative spirit among managers in the organization.
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  • Siemens: Building a Structure to Drive Performance and Responsibility (B)

    Peter Löscher became CEO of Siemens in July, 2007. It was one of the most turbulent times in the company's history as the company was reeling from a compliance scandal involving hundreds of millions of Euros in suspected bribes, and had to pay billions of Euros in fines and fees to clear its name. Further, the company's operating groups were underperforming their peers in terms of profitability, and had been for some time. Adding to the challenges, Löscher was the first outsider to run Siemens since the company's founding in 1847. After his arrival, Löscher moved quickly to assess the organization, a global, multi-line technology and engineering firm with over 475,000 employees and over €66,487 million of revenue and €3,345 million of net income. Klaus Kleinfeld, the previous CEO, had improved company performance, driven the company to become more globally focused, and sold off underperforming and non-core assets. However, his tenure was cut short by the bribery scandal. When Löscher arrived, he felt the company was overly complex, individuals lacked accountability and significant tension existed between headquarters and the regions. Löscher took advantage of the crisis to reorganize the company from 10 operating groups to 3 sectors, introduce regional clusters to enable smaller markets to focus on sales, establish the "right of way" of the global business, simplify financial reporting, and enhance the sales effort to market verticals. In addition to the changes that Löscher made to the company structure, he transformed employees' attitudes and renewed the entrepreneurial and innovative spirit among managers in the organization.
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  • Global Expansion at Sanford C. Bernstein

    Sanford C. Bernstein, a premier sell-side research firm, is expanding globally, and has recently opened an office in Hong Kong. Global Director of Research Robert van Brugge must consider how best to organize the firm's research department to enhance cross-sector and cross-geography collaboration among the senior research analysts in order to adapt to the challenging realities of global expansion in the financial services industry.
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  • Toni Sacconaghi at Sanford C. Bernstein

    Toni Sacconaghi, a senior sell-side equity research analyst at Sanford C. Bernstein, covering U.S. IT hardware companies, thinks about the challenges and opportunities presented by the firm's new office in Hong Kong. Sacconaghi was previously the only analyst covering IT hardware companies for Bernstein. However, the firm has recently hired an analyst to cover Asian IT hardware companies in Hong Kong. Sacconaghi thinks about the best way to work collaboratively with the new Asian analyst.
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  • Robin Bienenstock at Sanford C. Bernstein

    Robin Bienenstock, a senior sell-side equity research analyst at Sanford C. Bernstein, considers how to build her research franchise given the changing nature of the industry and the firm. A collaborative research paper called "Computer in Your Pocket" was recently published by four of her colleagues, but she was not consulted or asked to contribute. As clients call Bienenstock asking for her response to the investment conclusions in the paper, Bienenstock wonders 1) how she should respond to the report and 2) how she can increase her collaborative work in the future. As she continues to grow her franchise in terms of both the number of companies under coverage and team members, she wonders how she can best organize her team in order to leverage herself effectively.
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  • What 17th-Century Pirates Can Teach Us About Job Design

    When asked to design the job of a pirate captain in the 17th century, MBA students and executives lump together two areas of responsibility: star tasks-strategic work such as target identification, command during battle, and negotiating alliances to form fleets-and guardian tasks, which are operational work such as allocating arms, punishing indiscipline, and distributing loot. But candidates who can do both kinds of work well are rare, because star tasks require risk taking and entrepreneurship, whereas guardian tasks require conscientiousness and systematic effort. Pirates made the captain responsible for the former and elected a quartermaster general to perform the latter.
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  • Xerox's Former CEO on Why Succession Shouldn't Be a Horse Race

    From the moment Mulcahy stepped into her job as CEO, in 2001, the Xerox board began discussing who would succeed her. Looking back on the long process of grooming and choosing her successor, she acknowledges the wisdom of having started that conversation a lot earlier than might feel comfortable. It allowed ample time to give the four candidates developmental responsibilities and visibility with the board. Meanwhile, Mulcahy sent honest signals to them about what the possibilities were if they didn't get the job, in an effort to keep their talent within the company. She felt that pitting them against one another in a classic "horse race" would be dysfunctional for Xerox. In July 2009 Ursula Burns succeeded Mulcahy, in the first woman-to-woman CEO handoff among Fortune 500 companies-and became the first African American woman to lead a large U.S. company. The board's confidence in her had been well established long before, and the final transition was accomplished without drama.
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  • The Sustainable Supply Chain

    Peter Senge, the author of The Fifth Discipline and The Necessary Revolution, talks about the challenges of leading organizations at a time when their supply chains need to be radically transformed. The first challenge is building an understanding of the larger system in which any organization exists. The second is learning to work with parties throughout that system, such as NGOs that can provide access to crucial knowledge and expertise. The third challenge is developing a different attitude about sustainability: Being "less bad" is not a vision that can inspire people to undertake large-scale change. These supply chain challenges are all leadership issues, but they are not restricted to chief executives. Leadership in this area can come from many places in the organization, including technical and process specialists, and even from the outside. What's important to effecting change across a supply chain is passion, an ability to form networks, organizational savvy, and a recognition of the realities, such as finite resources, that are now asserting themselves.
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  • How to Save Good Ideas

    When it comes to gaining buy-in for a new idea, we've been taught to focus on getting the idea right instead of on making sure people understand and support it. That, explains Kotter, has left us unprepared to deal with the attacks that can kill off even the most carefully developed concepts. In this edited interview, the leadership expert discusses various idea-killing attacks and offers some rules for responding to them. Whether you're working on a small deal with just a few players or a large-scale change effort in an organization of thousands, you're in the "murky land of human nature and group dynamics," Kotter says. People's anxieties and opinions color the way they react to new ideas. Kotter and Lorne Whitehead have identified four common ways that people shoot down ideas: fear-mongering, death by delay, confusion, and ridicule. Marginalizing the troublemakers might seem like the obvious response, but Kotter and Whitehead have found that people who were effective at gaining support for their ideas invited naysayers to critique their ideas and treated them with respect. They also communicated clearly and simply, never let the disagreement become personal, attended to the entire group instead of just to the most vocal critics, and prepared responses to a variety of potential attacks. Learning how to win buy-in for an idea is a basic life skill, Kotter says-one that is as relevant to a student working on a group project as it is to an executive in a business setting.
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  • Losing the Top Job-and Winning It Back

    Michael Mack was a prototypical success story-after getting his Harvard MBA, he worked for a top-tier consulting firm and next made a move into entrepreneurship as the owner of a growing restaurant chain. Then, to his shock, his board fired him. That setback sent him on a personal journey that made him a much wiser leader.
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  • Life's Work: Annie Lennox

    A four-time Grammy winner and UNAIDS goodwill ambassador talks about what drives her as an artist and an activist.
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  • Strategic Leadership for the 21st Century

    The purpose of this Executive Digest is to (1) examine the predictions made for the 21st century, (2) identify what has occurred in the first 10 years of this new century, and (3) recommend approaches to the strategic leadership of organizations needed for survival and success as the 21st century progresses.
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  • OPOWER: Increasing Energy Efficiency through Normative Influence (A)

    The case profiles OPOWER, an energy efficiency software company that applies Cialdini's principles of social influence to successfully encourage consumers to reduce their energy usage. OPOWER was co-founded in 2008 by two young Harvard graduates, Dan Yates and Alex Laskey, who were inspired by Robert Cialdini's behavioral science research showing that people's normative beliefs - and messaging tailored to those beliefs - had a powerful and measurable impact on their energy-conserving behaviors. Yates and Laskey redesigned the home energy bill to include normative messaging, including feedback on how consumers' energy usage compares to their neighbors' usage. Through early trials of the program, the electrical utilities began seeing 1.5% to 3.5% savings in energy usage, almost immediately. After the rapid success of OPOWER's first three years, Yates and Laskey wondered whether their approach would produce sustainable results: what strategy should they pursue to ensure that consumers continue to read and respond to the normative messaging in the "Energy Bill 2.0"?
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  • The Parent Academy: Family Engagement in Miami-Dade County Public Schools

    In 2004, Miami-Dade County Public Schools began the planning process for creating the Parent Academy, a new district-wide initiative to increase family engagement in schools. This case discusses the planning and implementation for this major initiative, and describes how the initiative changed when a new superintendent entered the system in 2008. It delves into the theory behind the initiative, the challenges and benefits of this approach to addressing family engagement, and presents the dilemma of whether and how to sustain the program into the future.
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  • HBS Class of 2009: All Talk As They Prepare to Walk?

    Max Anderson, HBS Class of 2009, founded the MBA Oath Initiative. The oath was a voluntary pledge "to create value responsibly and ethically." Anderson and a team of students and faculty worked to launch the first MBA Oath Ceremony conducted on campus during Harvard graduation week.
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  • Timberland's CEO on Standing Up to 65,000 Angry Activists

    Swartz awoke on June 1, 2009, to find the first of what, over time, would amount to 65,000 angry e-mails accusing Timberland of destroying Amazon rain forests and exacerbating global warming. The senders were reacting to a Greenpeace report alleging that Brazilian cattle farmers were illegally clearcutting forests to create pastures, and leather from their cows might be winding up in Timberland's boots. Swartz and his team had to craft a response immediately: The brand's reputation was at stake. He realized that the underlying question-Where did Timberland's leather come from?-was legitimate, and that he didn't know the answer. The idea of tracing hides back from tannery to pasture was daunting, but he saw the issue as a battle for the hearts and minds of environmental activists. The company opened a dialogue with Greenpeace and worked with its Brazilian supplier to get the origin of its hides certified. Meanwhile, Swartz made sure that all those e-mails received replies. In the end, Timberland praised Greenpeace for bringing the issue to the industry's attention, and Greenpeace acknowledged that Timberland had taken a leadership position on it.
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  • The Judgment Deficit

    Individual judgment and initiative are essential to the success of the modern capitalist economy. At the same time, rules and centralized systems are needed to bring order and prevent waste. Balancing decentralization and command-and-control modes of decision making has always been a struggle, and organizations have experience managing the tension. In recent times, though, a new form of centralized control has taken root: mechanistic decision making based on top-down statistical models and algorithms. This has been especially true in finance, where risk models have replaced the judgments of thousands of individual bankers and investors, to disastrous effect. The problem with the statistical approach is that it cannot adequately account for the uncertainty inherent in economic decisions or the idiosyncratic nature of human activity. What finance in particular needs is a return to judgment. The author offers some broad guidelines for this: Computerized controls work best with inanimate products and processes that can be physically shielded so that the variations of conditions can be minimized. Computers also shine when, like the configuration of pieces on a chess set, the number of possible outcomes is vast-in fact, this vastness often gives the computer its edge-but they all conform to well-specified rules. Conversely, human judgment is favored when shielding is difficult, outcomes are ambiguous, and the possibilities are open-ended. Ultimately, however, the "right-sizing" of judgment is itself a matter of judgment.
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  • Four Mistakes Leaders Keep Making

    Again and again, senior managers fall into four behavioral traps that thwart organizational change. The behaviors are difficult to recognize and reverse because they serve to protect egos and prevent anxiety-but executives can overcome them. First, managers fail to set proper expectations. When they announce major directional changes or new goals, they don't spell out credible plans or specify who's accountable. Second, they excuse subordinates from the pursuit of overall goals, allowing people to remain preoccupied with their own units. Third, executives essentially collude with staff experts and consultants by going along with a deeply flawed contract: The experts agree to deliver and implement a "product" (a new system, for instance) but don't include measurable gains as part of the deal. Fourth, managers wait while associates overprepare. After challenging their employees to make needed improvements, they accept the response "Yes, but first we have to..." Finish the sentence: Train our people. Set up focus groups. Bring in Six Sigma. And so on. The best way to confront the traps is to conduct small personal experiments that rapidly produce tangible results, incur little risk of failure, and are confined enough to demonstrate a clear link between trial and outcome. For example, one iron plant addressed quality problems by targeting five areas for improvement, setting clear and measurable goals for each, and holding team leaders accountable for outcomes. All five experiments succeeded and were extended to the rest of the plant. Quality problems eased up within 100 days and virtually disappeared a few months later.
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