MIT Sloan Management Review Fall 2015

Maybe we should have called the fall 2015 issue of MIT Sloan Management Review the “disruption” issue. After all, two unrelated articles in this issue of MIT SMR prominently feature either the word “disruption” or “disruptive.” However, the two articles explore completely different aspects of management. In “Preparing for Disruptions Through Early Detection,” Yossi Sheffi, a professor of engineering systems at MIT and director of the MIT Center for Transportation and Logistics, shares insights from his new book The Power of Resilience (MIT Press, September 2015) about how companies are learning to more quickly detect unanticipated problems that can interfere with their global operations. Such disruptions range from hurricanes to the discovery of product contamination. In fascinating detail, Sheffi describes how leading companies are using an array of detection and response…

Image courtesy of Carlsberg A/S There is ample evidence that geography matters for innovation. Innovation flourishes when workers are in close proximity to each other, where face-to-face encounters and job changes foster the flow of knowledge and the exchange of ideas. As Michael E. Porter of Harvard Business School and other scholars have noted, many companies choose to locate in industry clusters — regional concentrations involving a particular industry — on the presumption that they will gain an advantage in learning or in hiring workers with relevant skills and knowledge, and by being near suppliers and complementary businesses. Face-to-face interactions, formal and informal, frequent and repeated, become more valuable in an uncertain, complex world in which context is very important (what Eric von Hippel of the MIT Sloan School of Management…

Image courtesy of Flickr user The DEMO Conference. We live in the age of platforms. Facebook, Google, Amazon, and Apple — many of today’s most successful technology businesses have at their core a platform-based business model. Platforms are multisided networks that bring together two or more distinct types of users and facilitate transactions among them. eBay, for instance, links buyers and sellers; Playstation links game developers with gamers; Apple’s App Store transfers applications from software developers to iPhone and iPad users. Increasingly, entrepreneurial startups are embracing a platform approach; look no further than fast-growing young companies such as Uber and Airbnb. Today, many entrepreneurs and established businesses are trying to copy the success of existing platform businesses. Executives often assume that the key is to grow the sheer number of users and…

Society’s biggest challenges are also its most complex. From shared economic growth to personalized medicine to global climate change, few of our most pressing problems are likely to have simple solutions. Perhaps the only way to make progress on these and other challenges is by bringing together the important stakeholders on a given issue to pursue common interests and resolve points of conflict. However, it is not easy to assemble such groups or to keep them together. Many initiatives have stumbled and disbanded. The Biomarkers Consortium might have been one of them, but this consortium beat the odds, in large part due to the founding parties’ determination to make it work. Nine years after it was founded, this public-private partnership, which is managed by the Foundation for the National Institutes of…

Large companies with corporate social responsibility (CSR) policies in place are not always trusted or believed. How can companies address this communication challenge? One common strategy is to disseminate a great deal of information — everything from detailed CSR reports to overviews of your initiatives — on the Web and on popular social networks. The goal is transparency about your CSR activities. But even proactive, transparent CSR communications often ignore the issues about which stakeholders are most curious. Moreover, stakeholders sometimes believe corporations communicate opportunistically about CSR commitments. Pushing CSR-related communications messages at the public can foment mistrust and foster indifference. People do not seem to pay much attention to information disseminated by companies. For example, a CSR branding study conducted in 2010 by the market research company Penn Schoen Berland,…

Photo by Alexander V. Dokukin This year’s Richard Beckhard Memorial Prize goes to the spring 2014 MIT SMR article by Julian Birkinshaw, Nicolai J. Foss, and Siegwart Lindenberg, entitled “Combining Purpose With Profits.” In this article, the authors examine a familiar and important question for managers: How can the tension between purpose and profits be best managed? The authors explore the kinds of structures companies need to put in place to provide clarity and direction for employees while also serving to both motivate individuals and draw people together in a common pursuit. As the judges for the prize pointed out, the tension between purpose and profit is well-known, and many companies claiming to have “pro-social goals” have difficulty backing up their claims. However, the judges were impressed with the examples the authors presented…