SMA: Micro-Electronic Products Division (A)

Michael   Beer; Michael   Tushman

Case | HBS Case Collection | May 2000 (Revised December 2018)

SMA: Micro-Electronic Products Division (A)

Abstract

The Micro-Electronic Products Division of SMA has financial and organizational problems. Conflict and lack of coordination exist between functional groups. Employees do not have a sense of direction and morale is low. The cause of these problems is found in a change in business environment followed by change in organization and management. A rewritten version of an earlier case.

Keywords: Change Management; Organizational Change and Adaptation; Organizational Culture; Organizational Structure; Conflict and Resolution; Business Strategy;

Language: English

Format: Print

18 pages

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Citation:

Beer, Michael, and Michael Tushman. "SMA: Micro-Electronic Products Division (A)." Harvard Business School Case 400-084, May 2000. (Revised December 2018.)

Is Silence Killing Your Strategy?
In his thirty years of working in corporations, Harvard Business School professor Michael Beer has witnessed firsthand how organizational silence derails strategic objectives. When employees can't speak truth to power, senior leaders don't hear what they need to hear about their company's fitness to compete, and employees lose trust in those leaders and become less committed to change.
In Fit to Compete, Beer presents an antidote to silence—principles and a time-tested innovative process for holding honest conversations with everyone in your organization. Used by over eight hundred organizations across the globe, the strategic fitness process has helped leaders in a diverse range of industries—including medical technology, information technology, banking, restaurant chains, and pharmaceuticals—hear the raw but necessary truth about the sources of misalignment between their strategies and their organizations.
In addition to step-by-step instructions, Beer offers detailed and illustrative case studies of companies that have conducted honest conversations to great effect. He also shows how to apply the process more broadly to a variety of strategic challenges and at multiple levels throughout the organization. Practical, enlightening, and comprehensive, Fit to Compete is the book you should turn to if you want to create winning strategies that your entire company will rally behind.

Article | Strategy & Leadership | 2019

Overcoming Cultural Resistance to Open Source Innovation

John Winsor, Jin Hyun Paik, Michael Tushman and Karim R. Lakhani

Purpose: This article offers insight on how to effectively help incumbent organizations prepare for global business shifts to open source and digital business models.
Design/methodology/approach: Discussion related to observation, experience and case studies related to incumbent organizations and their efforts to adopt open source models and business tools.
Findings: Companies that let their old culture reject the new risk becoming obsolete if doing so inhibits their rethinking of their future using powerful tools like crowdsourcing, blockchain, customer experience-based connections, integrating workflows with artificial intelligence (AI), automated technologies and digital business platforms. These new ways of working affect how and where work is done, access to information, an organization’s capacity for work and its efficiency. As important as technological proficiency is, managing the cultural shift required to embrace transformative industry architecture – the key to innovating new business models -- may be the bigger challenge.
Research limitations/implications: Findings are based on original research and case studies. Insights are theoretically, based on additional study, interviews, and research, but need to be tested through additional case studies.
Practical implications: The goal is to make the transition more productive and less traumatic for incumbent firms by providing a language and tested methods to help senior leaders use innovative technologies to build on their core even as they explore new business models.
Social implications: This article provides insights that will lead to more effective ideas for helping organizations adapt.
Originality/value: This article is based on original research and case experience. That research and experience has then been analyzed and viewed through the lens of models that have been known to work. The result is original insights and findings that can be applied in new ways to further adoption within incumbent organizations.

Keywords: open source innovation; Organizational Culture; Organizational Change and Adaptation; Business Model; Technological Innovation; Collaborative Innovation and Invention;

Citation:

Winsor, John, Jin Hyun Paik, Michael Tushman, and Karim R. Lakhani. "Overcoming Cultural Resistance to Open Source Innovation." Strategy & Leadership 47, no. 6 (2019): 28–33. View Details

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Why do incumbent firms frequently reject nonincremental innovations? Beyond technical, structural, or economic factors, we propose an additional factor: the degree of the top management team's (TMT) frame flexibility, i.e., their capability to cognitively expand an innovation's categorical boundaries and to cast the innovation as emotionally resonant with the organization's identity, competencies, and competitive boundaries. We argue that inertial forces generally constrict how TMTs perceive innovations but that frame flexibility can overcome these constraints, increasing the likelihood of adoption and broadening the organization's innovation practices. We advance a theoretical model that relaxes the assumption that cognitive frames are static, showing how they become flexible via categorical positioning, and introduce a role for emotional frames that appeals to organizational members' sentiments and aspirations in innovation adoption.

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SMA: Micro-Electronic Products Division (A)

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SMA: Micro-Electronic Products Division (A)

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