Speaker(s):  Gary Pisano (HBS)

Title: Restoring Our Competitive Edge: TOM Research at a Crossroad

Abstract: My seminar will examine the trends in TOM research over the past 20 years with an eye toward stimulating discussion and debate about future directions of the field.  I am particularly interested in examining the question: which core elements of “TOM theory” as developed by the researchers in the 1980s and early 1990s still apply today and which ones need revisiting?

 The field of TOM is concerned with understanding differences in operating performance across organizations (e.g. why are some firms’ factories more productive than others? why do some firms provide better customer service than others? why are some organizations able to develop products more quickly and more effectively than others? etc.) During the 1980s and early 1990s, through the research of Hayes, Wheelwright, Clark, and others in the TOM Unit, there emerged an implicit “theory of TOM” providing a basis for tackling these issues and for shaping management practice in operations. This “theory” had a number of pillars, including:
 

1)  Operational capabilities matter to competitive outcomes

2)  Operational capabilities are rooted in distinct organizational processes generally associated with integration, coordination, proactive experimentation & problem-solving, and rapid information flows.

3)  Organizations face trade-offs in the building operating capabilities (no firm can do all things equally well, and there is no one best operating strategy).

4)   Significant operational performance differences across firms over time are the result of systematic differences in organizations’ capacities for learning.
 

            Over the past decade, much has changed in the business context in which operations is practiced (e.g. massive advancements and deployment of information technology, globalization and in particular the emergence of China and India, rising concerns of environmental impacts of operations, etc.).  At the same time, many elements of “TOM theory” have become widely accepted both inside and outside the field of operations. For instance, integration and rapid problem-solving are dominant themes in research and product development.  The idea that capabilities matter to competitive advantage now represents orthodoxy in the field of strategy.   In the seminar, I want to engage the group in a discussion of these trends and the implications for TOM research and the development of new (and useful) TOM theories.