For Immediate Release: January 12, 2006
Contact:  Kerry Parke, kparke@hbs.edu, (617) 495-6931

NEW BOOK FROM RESOURCE ALLOCATION TO STRATEGY EXAMINES HOW MANAGERS CAN DEVELOP STRATEGY ACROSS THEIR ORGANIZATION

Professor Joseph L. Bower

BOSTON - Contrary to conventional wisdom, a business strategy is not always conceived at the top levels of a corporation by a visionary leader. More often it is the result of a series of smaller allocation decisions at lower levels that may or may not reflect the goals of the company's management. From Resource Allocation to Strategy (Oxford University Press), a new book contributed to and edited by HBS professor Joseph L. Bower and assistant professor Clark G. Gilbert, examines how options for using resources are developed and selected and how these choices affect a company's overall strategy. On the basis of this understanding, Bower and Gilbert also look at ways executives can better manage these allocation processes and ultimately shape strategy across several levels of their organization.

Professor Glark G. Gilbert

Drawing on more than thirty years of research by scholars from Harvard Business School, the Stanford Graduate School of Business, London Business School, and INSEAD, Bower and Gilbert present a number of examples (including Intel, Kodak, and U.S. tire manufacturers) that depict how large companies manage their resources. Without exception, this activity is distributed widely across the organization - more so than expected - and while these actions have interdependent consequences, they proceed independently and simultaneously - a fact of business life that poses huge problems where coherence is a central requisite for efficiency and effectiveness.

In each chapter, From Resource Allocation to Strategy provides a straightforward look at an organization in terms of two processes: one considering the substance of proposed options, the other involving the choice among options. The book's various sections detail:

• the structural characteristics of the resource allocation process,
• how that process breaks down and leads to serious problems,
• different approaches for top management to intervene and shape desired results, and
• the role top management plays in dealing with these issues in demanding environments such as high technology and globalization.

For those who study firm management, the implications of From Resource Allocation to Strategy are considerable. Business activity normally considered in terms of substantive outcomes - market share and revenue growth, for instance, or present value and internal rate of return - is exposed as inextricably related to organizational and administrative questions.

The findings presented by Bower and Clark will inform the research of economists, strategists, and behavioral scientists, as well as thoughtful executives and those that advise them.

From Resource to Allocation is available online here: www.oup.co.uk/isbn/0-19-927744-3

About the Authors Joseph L. Bower is the Donald Kirk David Professor of Business Administration and chair of The General Manager executive education program at Harvard Business School, where he has also chaired the Doctoral Programs and served as Senior Associate Dean and as a Director of Research. A leading expert in the fields of corporate strategy, organization, and public policy, he has published extensively on the challenges to top managements posed by the contemporary world economy. A board member and consultant to major corporations, he has used his research and practical experience to transform research in strategic management.

Clark G. Gilbert is an assistant professor in the Entrepreneurial Management unit at Harvard Business School. His research focuses on corporate entrepreneurship and the challenges of innovation in large, established firms. Much of this research focuses on the impact of technological discontinuities. He also studies how strategies adapt to new settings. A former consultant at the Monitor Group, Gilbert earned a doctorate from Harvard Business School, where he received awards from the Academy of Management for Best Doctoral Paper and Best Dissertation Finalist in the field of strategy.

About Harvard Business School Founded in 1908 as part of Harvard University, Harvard Business School (www.hbs.edu) is located in Boston, Massachusetts, and offers full-time programs leading to the MBA and doctoral degrees, as well as more than 40 Executive Education programs. With a faculty of more than 200 distinguished scholars, the School is dedicated to educating leaders who make a difference in the world. Its core focus is to shape the practice of business, build enduring knowledge, and effectively communicate important ideas. Harvard Business School is the world's largest producer of business cases, a method of teaching pioneered by the School in the 1920s.