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This is an MIT Sloan Management Review article. Nancy Duarte and Garr Reynolds help world-renowned executives, politicians and thought leaders deliver stronger presentations. In a talk with MIT Sloan Management Review, they consider not how to make better presentations -their books handle that -but how to become a better manager by thinking more like a designer. They argue that managers and designers have to do many of the same things: embrace restraints, take risks, question everything and make sure that tools don't get in the way of ideas. And they reveal how design concepts such as hierarchy, balance, contrast, clear space and harmony are just as relevant to managers as they are to designers.

This is an MIT Sloan Management Review article.

This is an MIT Sloan Management Review article. Companies are aware of the potential benefits of "open innovation"-relying on outsiders both as a source of ideas and as a means to commercialize them -but they have struggled with precisely how to open up their product development to the external world. For starters, many executives have little idea how to motivate and manage outside innovation. Specifically, should external innovators be organized as a collaborative community or as a competitive market? Collaborative communities are perhaps best known through Linux and other open-source software efforts that are governed loosely by social norms and "soft" rules to encourage open access to information, transparency, joint development and the sharing of intellectual property. Competitive markets are strikingly different. Rather than collaborating, external innovators in a market will develop multiple competing varieties of complementary goods, components or services. Customers then choose from among the different offerings, and this often results in fierce competition -and little cooperation -among the innovators. Because the dynamics of communities and markets are so dramatically different, companies need to consider carefully which approach makes the best sense for their objectives. From their research, the authors have identified three critical issues that managers should take into account when making that decision: 1) the type of innovation that will be shifted to external innovators, 2) the motivations of those individuals, and 3) the nature of the platform business model. An in-depth analysis of those issues reveals that the choice between communities and markets is not as obvious -nor as clear-cut -as it might first appear.

This is an MIT Sloan Management Review article. It's hard to pick up a major management magazine -and we're not excluding this one -and not find several articles outlining in painful detail where a leader went wrong in a particular case. Implicitly or explicitly in these stories, the employees are treated as receptive individuals waiting only for the boss to offer a productive channel to their intrinsic energies. But when a boss stumbles, it may be as a direct result of actions taken by employees who have sabotaged their actions. To keep this from happening, leaders must: 1. Understand the situation they are walking into. Leaders need to know how they are likely to be perceived and what their predecessor was like. 2. Invest early in subordinates. New bosses need to spend significant time one-on-one with employees for three reasons: to understand them; to get to know them; and to establish a rapport. 3. Be mindful of their own behavior. New leaders often overestimate the extent to which their good intentions and good character will shine through. Demonstrating one's "authentic self " does not mean "being natural." Rather, it requires managers to seize everyday opportunities to demonstrate that they are trustworthy, supportive and fair. 4. Intervene early. New bosses need to take action if there is a problem. Letting things fester only postpones the inevitable.

This is an MIT Sloan Management Review article. Editor's Note: MIT Sloan Management Review first published "The New Practice of Global Product Development"in our Summer 2006 edition. In the article, authors Steven D. Eppinger and Anil R. Chitkara examined state-of-the-art and emerging best practices in global product development (GPD). GPD continues to evolve, and in 2009, we asked Eppinger, the General Motors Leaders for Manufacturing Professor of Management Science at the MIT Sloan School of Management, to update the article with new insights about GPD. His additions are published here along side the 2006 article, annotating the original text.

The degree to which consumers have come to depend on easy, inexpensive credit is a far greater threat to the economy than most realize. To pay it off, the average U.S. consumer would have to hand over every penny of his take-home pay for 16 months. And in all that time he wouldn't be able to buy anything else--no clothes, food, coffee, nothing. Okay, so no one is going to do that. But what will people do? Individual decisions to cut back on consumption--or perhaps run up the credit cards to the max and then declare bankruptcy--will translate in the aggregate into tremendous volatility and risk for the companies customers buy (or suddenly stop buying) from. In fact, warn investment banker Jarvis and Wharton professor MacMillan, the profits and cash flows of nearly all U.S. companies are built directly or indirectly on consumer spending, and the connection is not always obvious. How many loyal supermarket customers are quietly opting to pay for their food with their credit cards rather than their debit cards? How many consumers will tap their home-equity lines of credit to pay for their next vacation? How many companies are unaware of their indirect connection to these debt-laden consumers through their distributors, retailers, and financial institutions? Those directly involved in the credit industry itself should be bracing for record numbers of bankruptcies. Those companies, like the auto dealers, that finance consumer purchases directly should be working flat out to reduce their dependence stream. And any company whose customers--or whose customers' customers--pay with credit need to be bolstering their reserves, now. The authors detail a tool that will let you measure the level of your company's exposure to consumer credit, analyze how sensitive your firm is to sudden changes in default rates, and determine what steps you can take to mitigate your risk. Managers that ignore the warning signs and leave their company vulnerable have only themselves to blame.

Duke behavioral economist Ariely and Harvard Business School professor Norton explore how our consumption of concepts influences physical consumption, both positively and negatively.

If your firm has downsized recently, you're now managing a bunch of survivors - the lucky ones who didn't get laid off. But good fortune doesn't make for good performance, at least not in this situation. Chances are, you're presiding over a heightened level of employee dysfunction, even if you don't see it yet. Here's what you can do to limit the damage.

Having studied the dynamics of cascades in complex systems, this Columbia sociologist and network scientist argues that the most damaging ones are impossible to anticipate. The solution, therefore, may be to make systems less complex to start with, in order to reduce the chance that any one part can trigger a catastrophic chain of events. In the financial system, this means preventing companies from growing too big to fail in the first place.

Krugman - a professor at Princeton University, the most recent winner of the Nobel Prize in economics, and a columnist for the New York Times - talks about the global financial meltdown: what surprises him, what scares him, and what he'd do to ensure a recovery if he were calling all the shots.

Poor leadership in good times can be hidden, but poor leadership in bad times is a recipe for disaster. Looking at 360-degree feedback data for more than 11,000 executives, the authors identified 10 leadership shortcomings, among them not walking the talk, failing to learn from mistakes, and lacking clear vision and direction.

Global industry restructuring is driving a dramatic increase in cross-border acquisitions, and some countries - notably the United States, the United Kingdom, and Canada - are selling a lot more than buying. To remain competitive, they should take action on three levels.

Whether it's a basic Mr. Coffee or a gadget that sports a snazzy device for grinding beans on demand, the office coffee machine offers a place for serendipitous encounters that can improve the social aspect of work and generate new ideas. What's more, a steaming cup of joe may be as good for your health as it is for the bottom line, says Lee, a professor of medicine at Harvard Medical School and the CEO of Partners Community HealthCare. Fears of coffee's carcinogenic effects now appear to be unfounded, and, in fact, the brew might even protect against some types of cancer. What's more, coffee may guard against Alzheimer's disease and other forms of dementia and somehow soften the blow of a heart attack. Of course, its role as a pick-me-up is well known. So there's no need to take your coffee with a dollop of guilt, especially if you ease up on the sugar, cream, double chocolate, and whipped-cream topping.

In this article, the author of The First 90 Days assesses Barack Obama's attempts to build momentum for change. Creating substantive early wins is critical for transitioning leaders, and Obama's moves to close the U.S. military detention facility at Guantanamo Bay and reverse longstanding policies on stem-cell research have won him broad support. Laying the foundation for longer-term changes is also important, and Obama scores well here in part because of the strong team he has appointed. Surprisingly, however, Obama's efforts to articulate an inspiring vision so far haven't been compelling enough to reach a public frightened by the financial collapse.

In 1971, when Alice Waters founded Chez Panisse in Berkeley, California, chefs at even the highest-end restaurants were still using frozen meat and produce. Waters chose to focus on fresh, simply prepared food using organic ingredients. She invented what is now known as California cuisine and went on to launch a sociopolitical movement based on her ideas about food and community. Her unwavering commitment to quality has produced some steep business challenges in the past, but Chez Panisse has survived for nearly 40 years and is now regarded as one of the best restaurants in the world. What does the recession mean for its future? In this conversation with HBR editors, Waters shares her thoughts. She believes more than ever in the importance of buying "real" food from people who are taking care of the land, but the restaurant kitchen is becoming thriftier and is recycling with even greater energy and enthusiasm than before. Waters keeps her staff motivated and loyal in part through an unorthodox form of job sharing: The two chefs in the main restaurant are paid for a full year but work only six months each, spending the rest of the time developing their skills in France. The cafe chefs are paid for five days a week but come to work only three, using the other two to visit the markets and create their menus. Waters couples her passion for sustainability with a readiness to adapt. She has traveled around the country presenting dinners in collaboration with local people and believes that her restaurant can change with the times. "We could transform ourselves into a soup kitchen or move to a farm," Waters says. "There's a lot of flexibility in the big vision of what Chez Panisse is."

Even in times of economic growth, it's challenging to be a good boss. Research shows that people placed in positions of authority often become less mindful of others' feelings and needs. Meanwhile, those in subordinate roles devote immense energy to watching and interpreting the actions of leaders. These tendencies make for a toxic tandem, which is only exacerbated during a crisis. Sutton, a Stanford professor, provides a useful framework to get bosses focused on what their people need from them most. In a situation where people feel threatened, a good boss finds ways to provide more predictability, understanding, control, and compassion. Predictability. Give people as much information as you can about what will happen to them and when. Preparation will reduce their suffering, and they can relax in the meantime - as Londoners during the blitz were able to do when the air-raid sirens were silent. Understanding. Accompany any major change with an explanation of why it's necessary and how it will affect routines. Internal communication should be simple, concrete, and repetitive. Control. Don't frame an obstacle as too big, too complex, or too difficult to overcome; people will be overwhelmed and freeze in their tracks. When it's broken down into less-daunting components, they can tackle it with confidence. Compassion. Tend to the emotional needs of people who are let go, and help them preserve their dignity. This is essential both for them and for their colleagues who survive the cuts. Demeaning those who have left will demoralize those who remain and may drive the best of them to jump ship. A manager who provides all four remedies will be perceived as "having people's backs" and will reap the rewards of employees' deep loyalty for years to come.

If there's one thing that the past decade's business disasters should teach us, it's that we need to stop evaluating corporate leaders simply on the basis of how much wealth they create for investors. A healthier yardstick would be this: the extent to which leaders create firms that are economically, ethically, and socially sustainable. The first step toward accomplishing that task is to create a culture of candor. Companies can't innovate, respond to stakeholder needs, or run efficiently unless the people inside them have access to timely, relevant information, point out professors O'Toole, of the University of Denver's Daniels College of Business, and Bennis, of the University of Southern California. Increasing transparency can be an uphill battle against human nature, however. The obstacles are numerous: macho executives who don't listen to their subordinates or punish them for bringing bad news; leaders who believe that information is power and hoard it; groupthink among team members who don't know how to disagree; boards that fail to question charismatic CEOs. Nevertheless, leaders can take steps to nurture transparency. By being open and candid, admitting their errors, encouraging employees to speak truth to power, and rewarding contrarians, executives can model the kind of conduct they want to see. Training employees to handle unpleasant conversations with grace also will break down barriers to honest communication. To avoid being blinded by biases, leaders can diversify their sources of information - an obvious measure that's rarely taken. Perhaps the biggest lever for cultural change is the executive selection process - choosing leaders for their transparent behavior, not just their ability to compete. And a few companies have even gone so far as to share all relevant information with every employee.

People in America have come to believe that business schools are harmful to society, fostering in their graduates behavior that is self-interested, unethical, and sometimes even illegal. Many are convinced that managers are simply incapable of self-regulation and have called for laws to govern executive compensation and corporate financial reporting. Sure, legislation is cumbersome, but the consequences of self-governance are apparently even worse. How did business schools become part of the problem rather than the solution? It's their own fault, maintains Apple University dean Podolny, who is in a good position to know (he has been a professor at Harvard and Stanford business schools and a dean of Yale's School of Management). Fifty years of efforts to increase rigor have left even the best business schools with a bias against teaching qualitative disciplines like ethics and leadership. What's more, the schools have allowed rankings organizations to drive their admissions policies and curricula, skewing them toward an overweening emphasis on making money. Podolny suggests a multipronged approach to tackling the problem: curriculum changes that emphasize the integration of several disciplines and link analytics with ethics; team teaching that ropes in professors from different fields to give students a holistic approach to business issues; a broader definition of scholarship that can embrace the research practices of less-quantitative academic fields; an end to using rankings to market the effectiveness of schools' MBA programs; and a willingness to rescind the degrees of individuals who act unethically in the workplace. If that sounds like a tall order, it is. Business schools will never become part of the solution, Podolny insists, until they reinvent themselves.

Will we ever learn? We'd barely recovered from Enron and WorldCom before we faced the subprime mortgage meltdown and more scandals that shook our trust in businesspeople. Which raises the question: Do we trust too much? In this article, Stanford professor and social psychologist Kramer explores the reasons we trust so easily - and, often, so unwisely. He explains that genetics and childhood learning make us predisposed to trust and that it's been a good survival mechanism. That said, our willingness to trust makes us vulnerable. Our sense of trust kicks in on remarkably simple cues, such as when people look like us or are part of our social group. We also rely on third parties to verify the character of others, sometimes to our detriment (as the victims of Bernard Madoff learned). Add in our illusions of invulnerability and our tendencies to see what we want to see and to overestimate our own judgment, and the bottom line is that we're often easily fooled. We need to develop tempered trust. For those who trust too much, that means reading cues better; for the distrustful, it means developing more receptive behaviors. Everyone should start with small acts of trust that encourage reciprocity and build up. Having a hedge against potential abuses also helps. Hollywood scriptwriters, for instance, register their treatments with the Writers Guild of America to prevent their ideas from being stolen by the executives they pitch. To attract the right relationships, people must strongly signal their own honesty, proactively allay concerns, and, if their trust is abused, retaliate. Trusting individuals in certain roles, which essentially means trusting the system that selects and trains them, also works but isn't foolproof. And don't count on due diligence alone for protection; constant vigilance is needed to make sure the landscape hasn't changed.

During a recession, when many companies face declining revenues and earnings, executives often conclude that innovation isn't so important after all. According to the authors, that's because it isn't integral to the workings of most organizations, so the creativity that leads to game-changing ideas is missing or stifled. Rigby, Gruver, and Allen, all partners at Bain & Company, point to the fashion industry as a model. Every season, successful fashion companies must reinvent their product lines - and thus their brands - or face certain death. They manage this constant challenge by creating unusual partnerships at the top that consist of an imaginative, right-brain creative director and a commercially minded, left-brain brand CEO. The authors call these alliances "both-brain" teams. Some famous examples exist outside the fashion industry: Steve Jobs and his COO at Apple, Tim Cook; the creative Bill Hewlett and the savvy David Packard; Bill Bowerman, the former track coach who developed Nike running shoes, and his business partner, Phil Knight. But fashion has gone the furthest to incorporate both-brain partnerships in its organizational model. Gucci Group and others have learned to establish and maintain effective partnerships between creative people and numbers-oriented people; to structure the business so that the partners can run it effectively and are clear about which decisions they own; and to foster left-brain-right-brain collaboration at every level in order to continue attracting talent. What makes these partnerships work? The authors have identified seven characteristics of successful partners: They are aware of their own strengths and weaknesses, have complementary cognitive skills, trust each other, possess raw intelligence, bring relevant knowledge to the team, speak to each other frequently and directly, and are highly committed to the business and each other.