Indra’s Drishtikona (Viewpoint)

10 Conceptual Breakthroughs in Management Science

Posted : December 25, 2005 at 11:33 pm [IST]

Victor Hugo once put it, “An invasion of armies can be resisted, but not an idea whose time has come.” A conceptual breakthrough can make enormous day-to-day difference. Some of the concepts that drew the attentions of global managers are listed here from the famous global consultants Booz Allen Hamilton magazine ‘Strategy+Business’. Perhaps these are the 10 ideas, which are most likely to endure for (at least) another 10 years. Fortunately, Indian manufacturing enterprises are all well acquainted with these concepts.

1.Execution It’s not your strategic choices that drive success, but how well you implement them. Execution does not mean attention to numbers and metrics, but “looking at your whole process, finding small ways to improve each part individually, really implementing the improvements, tracking the results to judge effectiveness, and then repeating the process.”

2.The Learning Organization A learning organization is one that is deliberately designed to encourage everyone in it to keep thinking, innovating, collaborating, talking candidly, improving their capabilities, making personal commitments to their collective future, and thereby increasing the firm’s long-term competitive advantage.

3.Corporate Values Companies that care about ethics, trust, citizenship, and even meaning and spirituality in the workplace (or that simply articulate their values carefully) perform better in the marketplace than companies that care just about “making money.” So goes the concept - but does it correspond with on-the-ground reality? Skeptics abounded: “After so many scandals,” wrote someone, “I doubt if this principle is really true!”

4.Customer Relationship Management The cultivation of long-term relationships with customers, including awareness of their needs, leads to highly focused, capable companies that try to make consumers “part of the family.” As everything gets more commoditized, companies that are most customer-centric will be the most successful.

5.Disruptive Technology Technological innovation radically alters markets by undermining incumbent companies - which are vulnerable because their offerings are all tailored to the needs of their existing customers. Change feels like a betrayal of those customer relationships. Thus the makers of personal computers trumped Digital Equipment; Wal-Mart trumped Sears; and downloadable music is trumping the recording industry.

6.Leadership Development You don’t have to rely on “putting the right people in place.” You can train all employees to be better choosers, better strategists, better managers, and in the end, better leaders. Companies can be both more effective and more responsible with smart leadership development practices in place. Leadership is important, not because of the leaders’ actions in themselves, but because of the actions that everyone else takes on their behalf.

7.Organizational DNA Leaders can design an organization’s structures - incentives, decision rights, reporting relationships, and information flows - to induce high performance by aligning them with one another and the strategic goals of the enterprise

8.Strategy-Based Transformation Beyond the “blank page” of reengineering, this is the redesign of processes and organizational structures, and the consequent cultural change, to fulfill the strategic goals of the enterprise.

9.Complexity Theory Markets and businesses are complex systems that can’t be controlled mechanistically, but their emergent order can sometimes be anticipated. An understanding of the ways that complex systems evolve can help managers intervene and act more effectively. Over the years, complexity theory has come to mean a family of related, but sometimes contradictory, theories - including chaos theory, artificial life, probability theory, and even system dynamics - of intricate and nonlinear systems in which so many elements interrelate that the effects appear random and unpredictable, even though it is possible to trace patterns of causality and probability.

10.Lean Thinking This type of process and management innovation is exemplified by the Toyota production system. Employees use a heightened awareness of workflow and demand to cut waste, eliminate cost, boost quality, and customize mass production.

- Indra

Category: Manufacturing |