| How Managers' everyday decisions create or destroy your company's strategy. | |
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MedLine Citation:
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PMID: 17345681 Owner: NLM Status: MEDLINE |
Abstract/OtherAbstract:
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Senior executives have long been frustrated by the disconnection between the plans and strategies they devise and the actual behavior of the managers throughout the company. This article approaches the problem from the ground up, recognizing that every time a manager allocates resources, that decision moves the company either into or out of alignment with its announced strategy. A well-known story--Intel's exit from the memory business--illustrates this point. When discussing what businesses Intel should be in, Andy Grove asked Gordon Moore what they would do if Intel were a company that they had just acquired. When Moore answered, "Get out of memory," they decided to do just that. It turned out, though, that Intel's revenues from memory were by this time only 4% of total sales. Intel's lower-level managers had already exited the business. What Intel hadn't done was to shut down the flow of research funding into memory (which was still eating up one-third of all research expenditures); nor had the company announced its exit to the outside world. Because divisional and operating managers-as well as customers and capital markets-have such a powerful impact on the realized strategy of the firm, senior management might consider focusing less on the company's formal strategy and more on the processes by which the company allocates resources. Top managers must know the track record of the people who are making resource allocation proposals; recognize the strategic issues at stake; reach down to operational managers to work across division lines; frame resource questions to reflect the corporate perspective, especially when large sums of money are involved and conditions are highly uncertain; and create a new context that allows top executives to circumvent the regular resource allocation process when necessary. |
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Authors:
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Joseph L Bower; Clark G Gilbert |
Publication Detail:
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Type: Journal Article |
Journal Detail:
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Title: Harvard business review Volume: 85 ISSN: 0017-8012 ISO Abbreviation: Harv Bus Rev Publication Date: 2007 Feb |
Date Detail:
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Created Date: 2007-03-09 Completed Date: 2007-04-16 Revised Date: - |
Medline Journal Info:
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Nlm Unique ID: 9875796 Medline TA: Harv Bus Rev Country: United States |
Other Details:
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Languages: eng Pagination: 72-9, 154 Citation Subset: H |
Affiliation:
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Harvard Business School, Boston, USA. jbower@hbs.edu |
Export Citation:
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| MeSH Terms | |
Descriptor/Qualifier:
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Administrative Personnel* Commerce / organization & administration* Decision Making* Humans Organizational Objectives United States |
From MEDLINE®/PubMed®, a database of the U.S. National Library of Medicine
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