Agile Competitors and Virtual Organizations; Strategies for Enriching the Customer

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It is becoming clear today that most of the management truisms that have guided executives and business educators for two generations no longer work. This book, written by three internationally recognized authorities on global competitiveness, is designed to help any business - large or small - come to terms with change and develop effective, profit-centered strategies. Clear, real-world examples are used to describe what it takes for companies and individuals to become "agile" - how they can thrive in a ...
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Overview

It is becoming clear today that most of the management truisms that have guided executives and business educators for two generations no longer work. This book, written by three internationally recognized authorities on global competitiveness, is designed to help any business - large or small - come to terms with change and develop effective, profit-centered strategies. Clear, real-world examples are used to describe what it takes for companies and individuals to become "agile" - how they can thrive in a competitive environment of constant, unpredictable change. The book is the product of the authors' extensive research in cooperation with industry and government leaders that resulted in the influential 1991 report, 21st Century Manufacturing Enterprise Strategy. This book presents an updated and expanded vision of agile competition, which promises to affect life in the 21st century as profoundly as mass production-based competition affected life in the 20th century. By focusing on practice rather than on theory, the book describes in detail how this new form of competition is rapidly differentiating winners from losers, not just in the U.S. but around the world.

Identifying the "new industrial revolution, " the authors present a vision for "cooperating to compete" in today's rapidly-changing business world. Nagel, Goldman, and Preiss show exactly why mass production is a thing of the past, and why customized products are the key to business survival.

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Product Details

  • ISBN-13: 9780442019037
  • Publisher: Wiley, John & Sons, Incorporated
  • Publication date: 10/1/1994
  • Series: Industrial Engineering Series
  • Edition number: 1
  • Pages: 414
  • Product dimensions: 6.34 (w) x 9.33 (h) x 1.44 (d)

Read an Excerpt


Chapter 2: The Emergence of a New Industrial Order

Looking inward, a company cannot have agile business capabilities if the relationships among its personnel are adversarial. The dynamics of teaming and of team management, of creating a company culture marked by universal responsibility and mutual accountability for success, by universal "thinking like an owner" attitudes, values, and behaviors, demands relationships that reflect trust, respect, and concern. This implies proactive postures toward workplace safety issues, the quality of work life, and work force diversity issues, not a grudgingly reactive posture.

The opportunities for improvements that will benefit everyone are enormous. A U.S. Bureau of Labor Statistics 1991 study revealed that one-third of automobile assemblers suffered a work-related injury or illness, 10 percent of them requiring time off, and that 5 percent suffered from cumulative trauma disorder. The payoff from a small investment in reengineering work processes to emphasize health and safety is great.

Changing Core Competencies

If competitiveness is enhanced by routinely utilizing expertise and facilities distributed among a number of companies, how is job security within a particular company affected? Cooperative production (in the broad, agile sense of the term) is not the same as outsourcing. But it does raise potential conflict with efforts to create relationships of trust and commitment within companies. Similarly, keeping a company focused on changing core competencies can be good for competitiveness but can translate into higher work force displacement.

Until the introduction of the SX-70 camera, Polaroid manufactured only the positive component of its self-developing films; it assembled finished cameras. Every piece of every camera was manufactured for Polaroid by some other company, Timex, for one, and the film chemicals and materials were produced for Polaroid by Kodak. The core competencies that the first-generation Polaroid Corporation needed to maintain were in organic chemistry, mechanical design (of its line of cameras), and some photographic filth chemistry and production.

With the SX-70, the company had to acquire a much broader range of product development and production competencies, from camera bodies to film packs. As Polaroid shifts, during the mid-1990s, to a focus on digital photography, it is building new core competencies, away from organic chemistry toward semiconductor device design and manufacture, digital imaging, and computer-related expertise. Kodak, of course, is making a similar transition to digital photography, and the board of directors' commitment to acquiring new core competencies is reflected in the hiring of George Fisher from Motorola to become Kodak's new CEO.

Identifying and prioritizing core competencies and sharing this information with all personnel are ways to maintain integrity and a sense of community. Continuing education and training for all are another means of sustaining work force commitment as core competency assessments and priorities change with changing markets and customer opportunities. Polaroid began offering courses in electronics and computer-related areas to personnel as soon as its management recognized the need to shift to digital photography. Nevertheless, focusing on core competencies has profound job security and job quality implications: downsizing in the near term and, by mass-production-era standards, premature skills obsolescence in the middle and long term.

Proactive Environmentalism

There is growing evidence that manufacturers are recognizing the value of taking the initiative on environmental issues. Today environmentally neutral manufacturing is the objective of growing numbers of U.S. companies, including the members of the Chemical Manufacturers Association (CMA), who account for more than 90 percent of chemical production in the United States. The CMA's Responsible Care program commits its members to meaningful public involvement in siting decisions and to rapid reductions in toxicity levels in wastes as well as in waste volumes.

Increasing numbers of companies are becoming proactive on environmental issues and are working together with leading environmental organizations. A joint effort in this area involves the Grocery Manufacturers Association, the New England Electric System, General Motors, Sun Oil Company, the Audubon Society, the Conservation Law Foundation, the Environmental Defense Fund, the Friends of the Earth, the Natural Resources Defense Council, the World Resources Institute, the Sierra Club, and even Greenpeace.

At Sandia National Laboratories, biodegradable terpenes (from citrus fruit rinds) have replaced toxic chloroethylenes as solvents in circuit board manufacture, and the water wash volume has been reduced by more than 90 percent. At Air Products' South Brunswick, New Jersey, polymer emulsion plant-a facility run almost entirely by operational personnel with managers serving as resources-recycling processes developed by workers have slashed annual sewage treatment costs, increased plant efficiency, and brought about significant annual savings. Saturn Motors routinely runs full-page ads, the theme of which is the environmental sensitivity of the company and its workers, identifying the programs it has established to minimize waste and recycle materials. Chrysler's Neon car brochures highlight the design objectives of "environmental harmony" and "green"-ness: recyclable parts, emissions-free paint coatings, fuel efficiency, and non-CFC refrigerants.

The political power of the European "Green" parties is reflected in increasingly stringent European Community packaging and recycling laws and in rising environmental standards. Spring 1994 elections to the European Community Parliament displayed yet again the broadening base of public support for Green party positions on these issues. In the United States, where there are no such parties, the pressure for reducing the environmental impact of commercial operations is channeled through the political and legal systems.

Ethical Decision-Making Increasing sensitivity to the value of ethical decision-making reinforces the emergence of an agility-based management philosophy. In 200 of the 1000 largest U.S. corporations the senior management position of corporate ethics officer or senior vice-president for business practices......

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Table of Contents

Foreword
Preface
Acknowledgments
Pt. 1 Confronting Change and Uncertainty
1 What Is Agility and Why Do We Need It? 3
2 The Emergence of a New Industrial Order 45
3 Agility: A Framework for Mastering Change 71
4 The Transition to Agility 121
Pt. 2 Thriving on Change and Uncertainty
5 Leading, Learning, and Thinking 185
6 Virtual Organizations 201
7 Enriching the Customer 235
8 Customizing Agile Business Strategies 267
9 Barriers to Assimilating Agility 289
10 Enabling Systems and Infrastructures 321
11 Measuring Agility: A Self-Assessment Approach 355
Epilogue 377
Appendix: Resource Organizations 381
References and Suggested Readings 399
Index 403
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