Charting a Path to Effective Project Teams

hommes d'affaires et bagarreTeam projects are quite common in strategy classes. While the topic of team effectiveness is usually more central for organizational behavior courses, it is essential for organizational effectiveness … and team projects. While you may not want to allocate a lot of time and resources to the topic, you may want to get teams off to a good start so you don’t have to address dysfunctions later in the semester. One reason things may go south is the team’s desire for a “fast and enthusiastic start.” A bias for action can sometimes sabotage collaborative efforts. That well-meaning call to action — “let’s get this done!” – can result in a “sloppy start.”

Larry Dressler offers a solution to this challenge for teams in organizations — require that teams undergo a careful process of “chartering.” This involves bringing team members together at the outset to clearly articulate answers to these questions. The following adapts the chartering process for student project teams:

  • Purpose: Why does this team exist? Why are team projects important for the learning process?
  • Role: What is our authority to make decisions? What aspects are required for the project and on what dimensions does the team have latitude?
  • Goals: What concrete outcomes do we intend to accomplish as a team? What level of quality? What learning objectives? What grade?
  • Agreements: What do we expect from one another? What shared commitments do we want to put in place in order to ensure we function well? (e.g., How we go about sharing information, meeting, making decisions, etc.)?
  • Support: What kind of support (e.g., guidance, resources, information, etc.) do we think we will need from others to succeed in achieving our purpose and objectives?

High performing teams invest the time and effort to create a project charter at the outset. Skipping the chartering process is like blowing off breakfast so you can get to work 30 minutes earlier. It seems like a good idea until intelligence and productivity fade away as your blood sugar plummets by 9:30 am. Once a clear project charter is in place, the team should review it periodically to reaffirm shared purpose, goals, and agreements or to update that charter based on what the team has been learning over the course of the work.

Contributed by Larry Dressler

Short Change: Killing it in (strategy) execution

Managing change is an essential part of strategy execution but many courses focus on strategy content and fail to give implementation the attention is deserves. As such, students may underestimate how much resistance they will encounter and managing this is key to success. Amy Lewis and Mark Grosser published a Journal of Management Education paper that describes an exercise for teaching change management. This 45-minute exercise can be used in a range of management courses and works well in almost any size class. Students are divided into two groups (managers and workers) that must cooperate to produce a re-organization (a simple seating chart). However, managers discover that workers are reluctant to move and about 90% of classes fail to achieve the task. This generates a lively discussion on what is required to lead change, as well as on topics such as communication, trust, power, and motivation. I just ran this for the first time and, to my surprise, the students were successful. However, in the process, it was clear that there were moments of distrust within and between groups. A last person held out to see if he could appropriate more value. In the end, the management team gave up all value that was created. That is, employees appropriated all of the value and managers actually lost money in the exercise. It was quite successful and students thanked me for the experience. All of the details needed to run the exercise are in the article at the link above and it was easy to set up and run.

Contributed by Russ Coff

A Classy Way to Participate

screen-shot-2014-12-03-at-9-11-26-amClass participation is typically a major component of grades in strategy courses. Some students are quite comfortable participating. Others not so much. This video from Rich Makadok offers some advice and instruction for students on how to do well on this portion of the class (you can find the script for the video here). This is designed especially to help those who have language barriers or who are otherwise uncomfortable speaking in class. Students learn how they can contribute to making the class better for everyone — including themselves. You may want to use the video in conjunction with class discussion voting arrows to help bring different perspectives to the forefront.

Contributed by Rich Makadok

Small Change in the Classroom

agent-of-change-01Strategy classes often give short shrift to managing change but this is where the rubber hits the road. Chris Smith offers a number of very simple group exercises that allow a deeper dive. These are especially helpful since they demonstrate key points quickly but in an interactive way. Of course, there are many other change management materials in the toolbox. One of my favorites is the classroom ruse. Here are a few that jumped out at me from Smith’s page:

Small Change: Cross Your Arms. Ask students to cross their arms. When they are comfortable, ask them to cross their arms the other way. Ask why the 2nd attempt might have left them feeling uncomfortable, even though it’s basically the same action. How tricky is it to cross your arms in different ways and equally how tricky it is to cope with even very small changes? Steer the conversation towards specific changes within the university or in their experience with other organizations. Discuss how to deal with such discomfort.

Mindful Routines: Alien at Dinner. Ask students to imagine themselves as aliens observing a human dinner party. Their task is to point out unusual human social norms and to explain them to the beings on their imaginary planet. Why do they drink poisonous alcohol? Why do they knock their glasses together when celebrating? This exercise helps to point out that just because something is accepted, does not mean it is the best way of doing things. It prompts students to examine existing routines anew and assess whether there are better methods. Continue reading

Exercise: Building a Strategy

811fp5fkral-_sl1500_Generic strategies are easy enough to explain and students typically feel that they understand. But do they really? Could they develop and implement a sound strategy? Sometimes it’s worth a bit of additional hands-on experience to make sure the lessons stick. Probably the most important message is alignment — the need to design the organization and product to fit the strategy. In other words, to make the appropriate tradeoffs. Lee Bolman offers a very simple house building exercise (out of index cards) that makes these points very nicely. Teams plan what kind of houses they will build and organize their production. Strategies naturally fall into more low cost (simple one story house) or differentiation (complex two story). The 20% quality bonus and 20% first mover bonus help to highlight these competing objectives. This one-page handout describes the rules and process for running the exercise. The debrief focuses on the teams’ strategies and how they organized:

  • Planning process — How did they frame the problem and explore solutions?
  • Competitive Dynamics — A strategy is more likely to be successful if few firms (teams) adopt it. How do they anticipate what rivals will do?
  • Implementation — Plans often don’t unfold as expected. A common problem is that when the time is up, they are stuck with inventories of unfinished products.

Overall, this is a simple and easy to implement exercise that drives home basic strategy and organization issues nicely. The exercise can be run in a little as 75 minutes, though 90 to 120 minutes provides more time for both the exercise and debriefing.  The steps to run the exercise are:

  1. Provide materials to teams (2 packs of 3-5 cards, 2-3 rolls of tape, 2-3 markers).
  2. Distribute the Quality Housing Instructions.  Briefly introduce the exercise and announce how much time is available for planning (10 min). At the end of the production period, do a count-down from 5 and firmly announce “Stop!”.  Teams may be startled when the time is up.
  3. Once teams have produced, have them calculate their expenses, revenue, and net income.  You can check houses against the specifications either immediately after a team produces, or after all teams have produced. If a team produces multiple houses, test a few to see if they can be dropped 12 inches without damage.
  4. Collect the financial results from all teams (revenue, costs, net), and award the bonuses for quality and first-to-market.

Contributed by Lee Bolman

Print the Legend: A multidimensional case

Print the Legend (2014) is a documentary about the 3-D printing industry, that offers an engaging case study covering industry, firm & technology life cycles, disruptive technologies, and strategy in emerging firms & industries. This industry was established in the 1980s focusing on large expensive printers for industrial use – Two key players dominated using different technologies. The market was seriously shaken by startups in the 2010s that drastically reduced pricing created a consumer market. As such, we see two distinct market segments (industrial & consumer) and two technologies (stereolithography & fused-deposition) all battling it out.

The film follows two startups from emergence through VC funding, and shows their diverging paths as one is acquired and one remains independent. MakerBot, hires an experienced Strategy Director who (with the VC) radically shifts the founding strategy. This leads to high turnover and eventually, founder exit and acquisition by a leading industrial 3-D printing incumbent. In contrast, FormLabs, takes a more emergent approach to strategizing and positioning. The award-winning film is very well-made and fun to watch – Students love it and learn from it. It features a prominent VC (Brad Feld) and startups that students may be aware of.

Teaching notes: The film (available on Netflix) runs 100 minutes, so with discussion, it takes a full 3-hour class. It is helpful toward the end of the semester as a “movie day” with popcorn and snacks – students appreciate a break the week before their big final project is due. It is helpful to spend about 20 minutes at the start of class giving a mini-lecture on firm & industry life cycles and disruptive technologies, to set up the film, as well as about 10 minutes at the end for a debrief. One can show the film in 10-20 minute segments, pausing to discuss what has happened so far. This case has been a big hit over the 2 years it has been in use. It’s a little logistically complex, and requires strict adherence to a schedule, but once you have it down, it’s a very easy class and case to teach. Full teaching notes, assigned pre-reading, slides, and film segments are available on Gina’s shared teaching site.

Contributed by Gina Dokko

Free Money … No Takers?

FreeMoneyEntrepreneurship students often think they’ve found a “no brainer” idea – one that everyone “obviously” will want. We’ve all seen it before – an idea that is so good that it requires zero dollars for customer acquisition because word of mouth and social media will lead to infinite sales, virtually overnight.

Here’s an exercise that may help open students eyes to just how hard it can be to sell something. Even something as wonderful as their idea. Give each student group five single dollar bills. Ask them to develop a plan for giving away the dollar bills to strangers, in a public place. Have them develop a business plan that includes a target audience, script, etc. Giving away free money is harder than it appears! And if it’s hard to give away dollar bills, it will also be hard to get the attention of customers even for a “no brainer” idea. This exercise comes from the following video which might be assigned after the exercise as part of the debriefing.

Contributed by Susan Cohen

Get Out the Vote … In Class

VotingArrows-smWhen leading a case discussion, wouldn’t it be nice to know exactly what positions students were prepared to defend? You want to bring people into the conversation who you know will have diverse perspectives to bring about a balanced discussion. Idie Kesner has a great low tech solution to your problem. Create arrow tents that can be reversed so they can display either up or down arrows (see the picture to the right). You can see instantly who is in favor or opposed to the strategic move proposed in a case. The instructor can call on people with an idea of what perspective they will bring in and/or encourage debate between students who have different positions. Here is a a template for the Student Voting Arrows (2 arrows/page).

IMG_20170915_171852A related innovation is tents that display the letters A through D. This can be used for cases that offer up to 5 alternatives that students might vote for (a,b,c,d, and no tent). Here is a template for the “a through d” student voting table tent. This must be folded lengthwise first to select the appropriate letter and then widthwise so the letter is displayed as a table tent (visible from both sides).

Contributed by Idie Kesner

Amazon Eats Whole Foods

amazonwholefoodsWith its $13.7B bid, Amazon agreed to pay a 27% premium over Whole Foods’ previous market valuation. This makes for a nice live case case in your strategy classroom. Was this a sound business decision? The market rewarded Amazon with an increase in its stock price. While some opportunities are apparent, it remains unclear exactly how Whole Foods will be worth 27% more to Amazon (and that’s just to break even). A five forces analysis will reveal that the grocery market is highly competitive with exceptionally thin margins — not an especially attractive industry to enter. So how can they win in this game? There are many possibilities that may come up in a discussion. For example, Amazon may:

  • Build online grocery sales, a tiny but growing portion of the industry.
  • Lower costs by applying automation technology and their supply chain expertise.
  • Use customer data to build sales through Amazon or to sell some higher margin “impulse” items at Whole Foods.
  • Leverage the market’s expectations that Amazon won’t pay dividends or post significant profit to lower prices and invest in the business.

Of course, these are highly speculative and carry significant risks. What is the likelihood that any of these will be achieved? Can Amazon manage change in such a large acquisition? Will other grocers make similar changes (or be bought out by tech companies with similar capabilities)? There is lots of fodder to discuss. Here is a packet of news articles that may be helpful. Also, I have prepared a spreadsheet to explore different scenarios for how this might play out where the starting point is Whole Foods’ recent financial performance (note that the decision tree requires the PrecisionTree Excel Add-in). Finally, here is a very brief poll to help assure that students come to class prepared and with an opinion on the deal.

Contributed by Russ Coff

Deflategate: Letting the air out of strategic planning

ballStrategies rarely work out as planned but somehow, students remain eternally hopeful that everything will go exactly as they expect. This experiential exercise allows students to “feel” Mintzberg’s (1994) critique of strategic planning. It also helps to illustrate and compare causation and effectuation decision-making logics (e.g., finding entrepreneurial opportunities). You can bring “Deflategate” (from the 2015 NFL season) to a classroom near you. The exercise proceeds as follows:

  1. Air pumpInflate ball & sit on it. Ask 2 volunteers to inflate a heavy duty inflatable ball using a small air pump (one can buy these a sport store) and try to sit on it afterwards for a minute. While introducing the exercise, the instructor should keep the plug hidden in her/his pocket. Inflating the ball is amusing (both the volunteers and the audience). It is not easy or quick to inflate the ball.
  2. Where’s the plug? After inflating, students look for a plug. The instructor waits a few seconds and plugtakes the plug out admitting that she/he had it all the time. The class will laugh. It may be frustrating for the volunteers but then we begin the debrief and explain the reason for the deception in the exercise.
  3. Debrief: According to Mintzberg, decision-makers (those who inflate the ball) expect everything will go smoothly according to what they planned but usually some unexpected circumstances occur that alter the plan’s effectiveness. Decision-makers cannot anticipate everything and the exercise drives this home and shifts focus to decision-makers’ bounded rationality. It is quite rare that students will look for a plug before doing the exercise (though it happens on occasion). One might move from here to discuss innovation, business models and disruptive innovation.

Other related toolbox exercises that demonstrate the challenge of predicting outcomes and implementing effectively include the Tinkertoy Exercise, the Strategy Puzzle, and the Paper fight. There are also some materials under the topic of scenario planning.

Contributed by Piotr WÓJCIK

Failure: The sequel

learning-failuretosuccessThis is another in our series of explorations in learning from failure (and learning from success). The Swedish Museum of Failures reminds us of some of the most spectacular product failures. Interestingly, most of them can be closely linked to some spectacular product successes. A complete failure may be a near miss. Perhaps a slight pivot away from extreme success. This video offers a window into some of the more interesting exhibits in the museum. One might ask students to review the video and imagine how a well-placed pivot might have helped each failure turn the corner. This might also fit with some of the toolbox posts on pivoting.

Contributed by Russ Coff

Angry Shareholders Sacrifice Donkey

StockholderFluDartShareholder activism is often identified as a mechanism to discipline managers and keep them focused on value creation for investors. An NPR story reports that shareholders in a zoo near Shanghai, frustrated that they weren’t making a profit on their investment, fed a live donkey to zoo tigers as a form of protest. At a shareholders meeting they voted in favor of feeding the donkey to the tigers to express their anger. Their objections center on the zoo’s debts and legal troubles. For two years, the investors said the venture has not been profitable. The video of the event has stoked public outrage and condemnation. While this is a rather unusual example of shareholder activism, it may spur some fruitful discussion in class. One of the interesting elements of this action is that the Corporate Social Responsibility literature would lead us to expect that investors have idiosyncratic preferences and will make trade-offs on returns (see this article by Mackey, Mackey & Barney). For example, one might expect that investors in a zoo would be willing to trade off financial returns to care for animals. A protest of poor profitability that hurts an animal seems especially unlikely. Yet there is is. As the cartoon implies, there are other ways for investors to protest…

Contributed by Russ Coff

Trumped up Strategy Class

This isn’t the first time polls have been wrong. The election of Donald Trump was a shock to many college students (as well as the press) and this may warrant some class time. Some instructors responded by providing space for students to express their feelings and this may be within the scope of the educational objectives for some classes. For a strategy class, a more relevant focus might be to examine the implications of the outcome for business strategies or to examine the campaigns from a strategic perspective. This might be considered as a template for how to discuss other sudden world events in the strategy classroom. Here are some takes on how to bring the election in while still emphasizing the pedagogical objectives of a strategy course:

  • Project case scenario analyses (Aya Chacar). Scenario analysis is designed to unearth factors that affect the efficacy of a given strategy. In a global context, country risk is a central factor in assessing strategic alternatives. In class, students discussed the likely impact of the election on the companies their teams are studying. Can you help the company? What do you think “could” be the impact on the companies under the new American administration -based on stated positions or past behavior? The companies they chose to study in this class are Amazon, Auchan, Didi Chuxing, General Motors, Naver, Uber, Volkswagen, and Walmart. All already have major international presence with some but not all having significant operations in China, Europe, India, Japan, Mexico, South Korea, SouthEast Asia and the US.
  • Entrepreneurship/Opportunity Recognition. The pollsters were all wrong. Often businesses and whole industries miss critical trends in consumer preferences and this probably means that there is unserved market space. Given trends that are now unearthed by the election, what market opportunities might there be for firms in various industries? One could use the project firms, cases you have done or specific firms that you think might be affected.
  • SWOT on campaigns (Peter Klein). While this framework is not preferred by most strategy scholars, it may raise some good points. A few examples from the Clinton campaign: O: demographics (e.g., increased Hispanic population, more socially tolerant electorate), unpopular opponent,chance to make history. T: middle-class concerns about economic inequality, backlash against political correctness, Clinton fatigue, incumbent fatigue, WikiLeaks. S: experience; support from major media, Wall Street, large corporations; ties to Obama and WJ Clinton; large staff of handlers; polish. W: experience; support from major media, Wall Street, large corporations; ties to Obama and WJ Clinton; large staff of handlers; polish.
  • Resources/Capabilities. Many of the campaign strengths turn out to be weaknesses depending on the context (experience, polish, support from corporations, etc.). What resources give a party a sustained advantage? What does “sustained” mean in this context? This might bring in a discussion of core rigidities and how once valuable resources can become critical weaknesses over time.
  • Disruptive Innovation (David Burkus). Clay Christensen described disruptive innovations as an innovation (typically from an outsider) that creates a new market and value network that eventually disrupts an existing market and value network, displacing established market leading firms, products and alliances. The Trump campaign might be viewed in this light as a disruptive strategy that overtook the conventional establishment.
  • PESTEL. Of course, this demonstrates the value/importance of looking outside of the industry for trends that may influence whether a given strategy will be effective or not. The PESTEL framework is a simple tool for bringing this in to the analysis (Political, Economic, Social Technological, Environmental, and Legal).
  • First 100 Days. Trump offered an ambitious list of things he planned to try and accomplish in the first 100 days. One can divide the list among groups and ask them to identify the implications of the policies for business in general or, preferably, for a specific firm/client.

Contributed by Russ Coff

Ethics: Gautam Style

Gautam Ahuja won the 2016 BPS Irwin Outstanding Educator award. It became clear from student testimonials that the capstone ethics lecture was not just memorable, it was an emotional peak that few students (or teachers) ever reach. What follows is a brief description/outline of the lecture. While it certainly won’t do it justice, it may offer some important ideas for instructors to explore.

I have them debate an actual decision (that varies from year to year). Essentially, I pick some current significant and controversial business decision or event that is legal and ideally, morally ambiguous, or even amoral (not immoral), at least apriori, and then foster a discussion on its pros and cons. This reveals much deeper fundamental issues. To illustrate I have used the following in different years:

  1. The decision by banks to award bonuses to traders for being on the “correct” side of the financial crisis deals in the years following the Lehman collapse
  2. The decision by a chemical company to use local safety standards in its different markets, which is completely legal,
  3. The decision to sell skin whitening creams in countries in India by large multinational companies,
  4. Provision of significantly discounted or couponed milk products for newborns,
  5. The federal reserves decision to keep interest rates low for the last x years
    and so on…

I then try and get them to debate this and, almost invariably, there emerge two sides to the issue. However what is interesting is that three other factors usually emerge: A) the problem is much deeper and more morally ambiguous than you thought, B) reflexive reversion to standard MBA, theories frameworks and concepts often leads to very flawed decisions ( in a good session an amazing large number of people change their initial decision), and C) In fact using the framework is itself part of the problem. Continue reading

What Strategic Change Feels Like

Managing change is given little time in most strategy courses. We often understate how difficult strategic change actually is and then wonder why organizations struggle so much with implementation (and our students think its all common sense). You can think of it as walking blindfolded on a tightrope between two solid foundations. During the transition, there is great uncertainty about whether the desired path is attainable. This, of course, is another way of looking at Lewin’s unfreeze/change/refreeze model. This video can help to illustrate the issue:

Contributed by Russ Coff

Fun and Game Theory

Economics-games.com is a free educational games site for teaching microeconomics, industrial organization and game theory. This site includes some simple (short) simulations designed to demonstrate specific principles. This should not be confused with longer simulations that extend across many class sessions. Instructors set up user IDs & passwords for their class and students are paired with others in the class (or even across universities if desired). These are really nice interactive online exercises that can be done between classes. In this sense, they are an excellent online complement beyond the usual readings and talking head videos. Here are some of the games:

  • Cournot and Stackelberg games
  • Public good financing game
  • Common-pool resources game
  • Prisoner’s dilemma
  • Asymmetric matching penny game
  • An air transport economics simulation covering price discrimination, vertical differentiation and peak-load pricing.

In addition, you may wish to check out some of their longer, commercial games (http://aireconsim.com).
Contributed by Nicolas Gruyer

How Xerox PARC Lost the PC: Putting the “O” in VRIO

Sometimes students struggle with how a firm can have valuable, rare, inimitable resources and still not have an advantage. This is central to the resource-based view and the VRIO framework. This clip from “Triumph of the Nerds” shows how PARC Xerox developed the GUI interface, object-oriented programming, and local area networks. Then it shows how they failed to exploit any of these innovations. In particular, it shows how Steve Jobs toured PARC and lifted the GUI to create the Macintosh computer. Here is a nice discussion of what the Xerox engineers thought of Steve Jobs’ visit. This can lead to a nice discussion of intellectual property, complementary assets, internal and external analysis. It is useful to show the first half (first 4.5 minutes) and ask students to speculate on why we don’t all have Xerox computers. Then the second half explains how Apple exploited the innovations.

Given Apple’s legal actions against Samsung and Google over the look and feel of their product, there is a certain irony that Apple imitated Xerox in their flagship product.

Contributed by Rich Makadok

Organizational Islands

This recent AT&T commercial captures the essence of organizational coordination challenges. Of course, they promise to solve these problems. I suspect that they can barely scratch the surface in most cases. In any event the video might lead to some nice discussions of coordination dilemmas and how addressing them is critical for strategic implementation. I might use it from 3 seconds to about 20 seconds to cut out the commercial tag line.

Contributed by Russ Coff

J. Crew’s “Great Man” Problem

The NYT Deal Professor notes: “J. Crew, Michelle Obama’s sometime clothing retailer, is yet another struggling private equity buyout. J. Crew’s owners, TPG Capital and Leonard Green & Partners, are stuck, tied to the bargain they struck with the company’s chief executive, Millard S. Drexler. Call it the ‘great man’ problem.” In other words, is the strategic asset a single individual or a set of organizational routines that are robust to key individuals leaving? In this case, J. Crew investors and the board were bound to go with CEO Millard S. Drexler’s recommendations and take the company private. Current struggles suggest limitations to this great man’s capabilities. Indeed, in Leonard Barton’s terms, he is looking more like a core rigidity. This has become a recurring theme. We have explored (in the toolbox) the implications of this for Steve Jobs at Apple but more recently for Jony Ive as Apple’s product development guru. This mini-case may encourage a discussion of strategic human capital, capabilities, organizational routines, and how these relate to corporate governance. Do such key individuals reduce or enhance sustained competitive advantage? Then, along the lines of my own work (Coff, 1999), there is the question of implications for rent appropriation. Clearly Drexler has done well on that front…

Contributed by Russ Coff

Exercise: Show Me the Money

Here is a simple exercise to demonstrate competitive advantage on the first day of class. Hold up a crisp $20 bill and ask “Who wants this?” When people look puzzled, ask, “I mean, who really wants this?” and then “Does anyone want this?”  Continue this way (repeating this in different ways) until someone actually gets up, walks over, and takes the $20 from your hand. Then the discussion focuses on why this particular person got the money. How did their motivation differ? Did they have different information or perception of the opportunity? Did they have a positional advantage based on where they were sitting? Other personal attributes (e.g., entrepreneurial)? The main question, then, is why do some people/firms perform better than others? This simple exercise gets at the nexus of perceived opportunity, position, resources, and other factors that operate both at the individual and firm level. Note that instructors should tell the class not to share this with other students. However, if you do have a student who has heard about the exercise (and grabs the money), asymmetric information about an opportunity is certainly one aspect of the discussion. The following “vine” might also help drive home the point about money and resources…

Contributed by Rich Makadok