|THEORY&PRACTICE|
Technology Fountainheads
by E. Raymond Corey
(Harvard Business School Press)
As corporate research and development costs
rise, many firms choose to participate in R&D consortia
collaborative ventures with academic institutions and government
agencies that help to fill their own needs in noncompetitive
technology development while contributing to national economic growth
and global competitiveness. In Technology Fountainheads: The
Management Challenge of R&D Consortia, Professor Emeritus Ray
Corey examines the experiences of six of the largest and most visible
R&D consortia in the United States in order to identify key
factors for successful collaboration.
Three of the consortia in Corey's study Texas-based SEMATECH and Microelectron-ics and Computer Technology Corporation (MCC) and Semiconductor Research Cor-poration (SRC) of North Carolina serve the semiconductor and computer industries, in which interfirm and international rivalries are intense. The other three consortia Electric Power Research Institute (EPRI), Gas Research Institute (GRI), and Bell Communications Research (Bellcore) draw their membership from regulated industries in which competition between firms has intensified more recently. Tech-nology Fountainheads sheds light on the differences among the two groups especially in terms of early development, missions, structures, and the distinct ways in which they operate and considers the dynamics of successful versus unsuccessful consortium management.
The Development Factory
by Gary P. Pisano
(Harvard Business School Press)
Product development has long been a source
of advantage for firms. In The Development Factory: Unlocking the
Potential of Process Innovation, Associate Professor Gary Pisano
suggests that process innovation can also be a competitive factor. In
a three-year study of pharmaceutical and biotechnology firms, Pisano
shows that
the development of distinctive and superior process technologies can
lower costs, improve quality, and increase flexibility.
He explores the dynamics of superior product and process development
in the highly competitive pharmaceutical industry, challenging the
widely held view that firms tend to emphasize either product or
process innovation, depending upon their stage of development.
Rather, Pisano argues, product and process development capabilities
are complementary.
"My goal has been to present this material in a way that not only proves stimulating and convincing to scholars interested in innovation, the management of knowledge, and organizational learning," Pisano writes, "but that is also accessible to practitioners interested in unlocking the potential of process development in their organizations."
HBS Research Available on World Wide Web
Pondering a business problem or management issue? Imagine with a computer keystroke or two being able to find synopses of Harvard Business School research on hundreds of topics.
Would you like to know more, for example, about the investment and financing decisions that are made during the development of entrepreneurial ventures? How about success factors for women managers, or the psychological factors that influence risk-taking? Interested in updating yourself about information technology in the organization, the changing nature of the work force, or new and provocative insights into the history of American business?
These are among the many topics currently being explored by HBS faculty and research assistants. Each year, more than 40 percent of the faculty's time and 30 percent of the School's total budget are devoted to faculty research and course development. A typical year at HBS will produce hundreds of new cases and dozens of books, as well as numerous articles and working papers. This activity covers an enormous variety of business and organizational issues; taken as a whole, it constitutes an unmatched resource for the study and improvement of current management practice.
To see for yourself, access the HBS Division of Research Homepage /research/ to find listings of research conducted at HBS over the last five years, arranged according to individual professor and by subject matter.
The following article is the seventh in a series on the activities and research taking place in each academic unit at HBS.
Professor Michael C. Jensen has a simple explanation for why people sometimes don't listen when they are angry and why they get defensive when someone criticizes them. "The human brain is defective," says Jensen, whose life's work has reached out beyond his research in economics, finance, and accounting to include psychology, sociology, neuroscience, and history.
Jensen explains that upsetting information triggers the amygdala, the emotional part of the brain, which in turn triggers the adrenal gland and floods the conscious brain with chemicals. By the time the information reaches the thinking part of the brain, the cortex has been tainted by the prior emotional response. Thus, messages of emotional content - performance evaluations, for example - are clouded by an emotional reaction that leaves the conscious brain incapable of making a rational response.
Understanding the irrationality of human behavior is essential for understanding how people relate - or do not relate - to each other, which is key to successfully collaborating with, motivating, managing, and leading others. This is a fundamental concept discussed in Coordination, Control, and the Management of Organizations (CCMO), one of the MBA Program's most popular electives. The course takes an interdisciplinary approach to organizational problem solving and value creation. In it, economics, psychology, and neuroscience are integrated and applied to problems in human resource management, labor economics, organizational behavior, finance, governance, and corporate control.
Jensen taught the first version of the course at HBS to thirty MBAs as a visiting professor from 1984 to 1985. He developed it while at the University of Rochester with his former colleague and frequent collaborator William H. Meckling in response to a call from students for an economics course that was applicable to real-life work situations. The pair redesigned their syllabus to view economics through the lens of organizational problems in large firms. Soon their interest in managerial issues outweighed their interest in economics, and they found themselves with a new course. Today, a much changed course with more than six hundred students enrolled, CCMO is the foundation of the interdisciplinary unit that Jensen chairs, Organizations and Markets.
Each of the unit's five faculty members brings specific expertise to its mission - "to develop a modern theory of organizations and markets that is useful to both social scientists and managers." Professor George P. Baker III, who studies management incentives and compensation systems, is investigating his theory that effective measurement of performance must use subjective judgment and qualitative assessments in combination with objective measures. Professor Carliss Y. Baldwin, with Dean Kim B. Clark, is examining the configuration of modular systems in the computer industry, while Professor Malcolm S. Salter's work on corporate strategy, organization, and governance looks at how ownership structure affects organizational performance. Asso-ciate Professor Karen Hopper Wruck, who specializes in corporate finance and internal governance and control systems, focuses on organizations in transition and is developing an elective called Compensation, Control, and Internal Governance.
A closer look at CCMO reveals the unit's penchant for breaking new ground in research and pedagogy. Because the course builds a general problem-solving framework, it is not specific to any function, firm, or industry. Instead, it draws on an eclectic collection of materials: HBS cases as well as readings from academic journals, popular literature, and current newspapers and magazines.
CCMO is divided into three sections that build on each other. In the segment titled "Foundations of a Theory of Organizations," students gain insights into human behavior through reading Daniel Goleman's popular work Emotional Intelligence. They expand their perspective on the use of knowledge in society by reading a 1945 paper from the American Economic Review. And through articles from the Wall Street Journal and The Economist they learn about "decision rights" and alienability and how these institutional devices solve the control problems in a capitalist society.
The second portion of the course, "Defining the Rules of the Game," examines organizational strategy, the theory of value, the allocation of decision rights, performance measurement, stakeholders, and compensation.
Students bring their cumulative understanding of organizations to the final part
of the course, "Governance and Corporate Control." While much of the reading here comes from scholarly journal articles on the topic and the popular press, students also prepare a case for most days to learn about organizational change and corporate control. Three examples are Wruck's case studies on restructuring at Safeway and leveraged recapitalization at Sealed Air and Baldwin's multimedia case on Thermo Electron.
Jensen notes that the course's content is applicable "everywhere," from the boardroom to the lunchroom. He takes pride that CCMO challenges the way students think. "This course changes how people view the world in fundamental ways," says Jensen. "It gives them a set of general principles for managing and for living."
by Susan Young