This book focuses on creating competitive advantage by building a lateral capability, enabling a firm to respond flexibly in an uncertain world. The book addresses international coordination and cross-business unit coordination, as well as the usual cross-functional efforts.

Jay R. Galbraith, Organizing for the Future:  The New Logic for Managing Complex Organizations, San Francisco: Jossey-Bass Publishers, 1993.

Based on more than ten years of research conducted by staff and associates at the University of Southern California's Center for Effective Organizations, this book explores key issues of organizational design and identifies practical new approaches for managing complex organizations to add value and stay competitive in a changing global marketplace. The authors describe how to create an organization with high levels of employee involvement and new roles for managers. They detail the use of new organizational forms, including knowledge work and managerial teams, and structuring human resource systems around skill levels.  

Robert M. Grant, “The Resource-Based Theory of Competitive Advantage: Implications for Strategy Formulation,” California Management Review,  Spring, 1991, 33(3), pp. 114-135.

The resources and capabilities of a firm are the central considerations in formulating its strategy.  They are the primary constants upon which a firm can establish its identity and frame its strategy, as well as the primary sources of the firm's profitability.  The key to a resource-based approach to strategy formulation is understanding the relationships between resources, capabilities, competitive advantage, and profitability - in particular, an understanding of the mechanisms through which competitive advantage can be sustained over time.  This requires the design of strategies that exploit to maximum effect each firm's unique characteristics.  Characteristics of resources and capabilities that are likely to be particularly important determinants of the sustainability of competitive advantage are: 1.  durability, 2.  transparency, 3.  transferability, and 4.  replicability.   

G David  Hughes, “Managing High-Tech Product Cycles,” Academy of Management Executive, May, 1990, 4(2), pp. 44-55.

High-technology firms need an organizational design that enables rapid development and implementation of strategies in an environment of accelerated technological change, short product life cycles, and global competition.  To meet these organizational needs, a double-portfolio organizational design is proposed in which the chief executive officer matches a portfolio of strategists to a portfolio of opportunities.  The 4 cells of the proposed design include entrepreneurs, growth strategists, economists, and recyclists.  The design supports previous work that shows that the development and survival of high-tech firms depend on their ability to integrate technology and market opportunities.  Also, the need for transformational leadership is reflected in the proposed design, with several examples from the microcomputer industry.  It is argued that transformational leadership is not needed only when a company faces a crisis.  Executives should create states of nonequilibrium as a process for organizational self-renewal and creativity.   

Robert F.  Hurley and Jukka M.  Laitamaki, “Total quality research: Integrating markets and the organization,” California Management Review, Fall, 1995,  38(1), pp. 59-78.

The market research function has to broaden its scope, move out of the functional trap in marketing, and become the organizer and facilitator of the company-wide Total Quality Research (SQR) system.  A discussion presents systematic approach for transforming the marketing research function into a Total Quality Research system which can guide a company's Total Quality Management (TQM) effort.  It describes how to design a TQR system that elicits the voice of the customer and business processes, and that organizes and deploys this information for use in strategic planning and resource allocation.  The TQR system is further explored by presenting case studies of leading companies that have applied different parts of this system in their TQM efforts.  Five imperatives for successfully implementing a TQR system are offered. 

Jeanne M. Liedtka and John W. Rosenblum, “Shaping Conversations: Making Strategy, Managing Change,” California Management Review, Fall, 1996.

The quality of both strategic thinking and action rely, in important ways, on the quality of the strategic conversations underway at all levels in the organization. The design of these conversations is the defining contribution of the strategy-making process. When these strategic conversations about the design of the future operate successfully at both local and organizational levels, they create a "meta-capability" for strategy-making capable of both furthering intended strategy and at recognizing opportunities for emergent strategy.  

Jeanne Liedtka, “In defense of strategy as design,” California Management Review, Spring, 2000, 42(3), pp. 8-30.

This article proposes management reconsider the usefulness of the metaphor of design as a prescription for strategy making, arguing against Henry Mintzberg's view that it is not appropriate. It reviews literature from the field of design and defines a set of attributes of the design process - which is synthetic, adductive, hypothesis-driven, opportunistic, dialectical, inquiring, and value-driven. The article examines the parallels between designing and creating business strategy and presents the implications of such an approach for designing the processes to design and execute strategy.

Raymond E. Miles, Henry J. Coleman Jr., and W. E. Douglas Creed, “Keys to success in corporate redesign,” California Management Review, Spring, 1995, 37 (3), pp. 128-137.

A discussion poses the question of why some US firms have succeeded in redesigning themselves to meet competitive demands while others have not.   Successful firms meet 3 key requirements for effective redesign: 1.  a commitment to total redesign as an economic "must," not simply an "ought,"  2.  a clear strategic vision supported by the structure and process changes
necessary to achieve it, and 3.  a managerial philosophy that fits the chosen strategy and structure.  Some firms have been able to install an alternative strategy-structure-process package by breaking completely from the established pattern.  Other firms have "rediscovered" a viable combination of strategy, structure, and philosophy by stripping away central bureaucracy.  Still others have searched outside familiar models, most often in the direction of network strategies and structures.  Overall, the capacity for organizational renewal comes from investing in human skills and knowledge-bases, which serve as competency reserves in changing times.

Praveen R. Nayyar and Robert K. Kazanjian, “Organizing to attain potential benefits from information asymmetries and economies of scope in related diversified firms,”  Academy of Management Review, October, 1993, 18(4), pp. 735-759.

Diversified firms can obtain benefits from information asymmetries and economies of scope.  Each source of benefits is based on different underlying mechanisms.  Attaining benefits relies on the adoption of appropriate organization structures and processes, which should be designed on the basis of the organizational requirements of each source of benefits.  The contingency theory linking diversification strategy to organization design is extended by proposing that the particular source of benefits being pursued by related diversified firms causes variations in the multidivisional form of organization.  Propositions derived from a consideration of the structure and processes required to successfully realize potential benefits are presented.  Consistent with Govindarajan (1986), Hoskisson (1987), and Kazanjian and Drazin (1987), the importance of strategy as a critical contingency for organization design is emphasized.   

Nitin Nohria and James D Berkley, “An action perspective: The crux of the new management,” California Management Review, Summer, 1994, 36(4), pp. 70-92.

Much has been written about the emergence of a new management paradigm in recent years.  However, it is perhaps better to think of the current changes in organizations as entailing a new perspective on managing rather than a new paradigm outright.  The notion of an action perspective is developed.  An action perspective is an emerging managerial outlook that focuses on bottom-up organizational action rather than top-down rational designs.  Drawing on the study of a unit of the industrial automation company Allen-Bradley, a discussion is presented of the meaning of an action perspective for 4 broad areas of management: 1.  structure, 2.  strategy, 3.  systems, and 4.  human resources.  Thinking in terms of an action perspective can help managers avoid the traps of an over-attention to design when implementing new ideas.  Managers must carefully distinguish between using designs as pragmatic tools for organizational action versus using them as ends in themselves.   

Michael Porter, Competitive Advantage: Creating and Sustaining Superior Performance, New York:  Free Press, January, 1995.

The author explores the underpinnings of competitive advantage in the individual firm. and describes how a firm actually gains an advantage over its rivals.

N  Venkatraman and John C Henderson, “Real strategies for virtual organizing,” Sloan Management Review, Fall, 1998,  40(1), pp. 33-48.

Current models of organizational strategy and structure fail to meet the challenges of the information age.  Based on a field study, an architecture for virtual organizing is developed that focuses on the importance of knowledge and intellect in creating value.  Information technology lies at the heart of this business model for the next century.  This approach incorporates 3 interdependent vectors: 1.  customer interaction, 2.  asset configuration, and 3.  knowledge leverage.  Each of the 3 vectors has 3 stages, and each vector raises a distinct series of questions for managers.  The overall challenge for companies is to harmonize the 3 vectors and to undertake external benchmarking when experimenting with different approaches to design.   

Daniel E.Whitney, “Manufacturing by Design,” Harvard Business Review, Jul/Aug, 1988, 66(4), pp. 83-91. 

Design is a strategic activity, whether by intention or default.  Design has an impact on: 1.  flexibility of sales strategies, 2.  speed of field repair, and 3.  efficiency of manufacturing.  The most effective way to cut through the barriers to good design is to use multifunctional teams.  These teams typically have 20 members in large projects and include every specialty in the company.  After establishment, these teams need a step-by-step procedure to discipline discussion and take members through the decisions cropping up in almost every design.  The chief functions of a design team include: 1.  determining the character of the product, 2.  subjecting the product to a product function analysis, 3.  carrying out a design-for-producibility-and usability study, 4.  designing an assembly process suitable to the product's character, and 5.  designing a factory system that fully involves workers in the production strategy, operates on minimal inventory, and is integrated with vendors' methods and capabilities.  Strategic product design is a total approach to doing business. 

Case Studies

Edward  Feitzinger and Hau L. Lee, “Mass customization at Hewlett-Packard:  The power of postponement,” Harvard Business Review, Jan/Feb, 1997, 75(1), pp. 116-121.

Using the Hewlett-Packard Co.  as an example, the key to mass-customizing effectively is postponing the task of differentiating a product for a specific customer until the latest possible point in the supply network.  Instead of taking a piecemeal approach, companies must rethink and integrate the designs of their products, the process used to make and deliver those products, and the configuration of their entire supply network.  Three organizational design principles together form the basic building blocks of an effective mass-customization program: 1.  A product should be designed so that it consists of independent modules.  2.  Manufacturing processes should be designed so that they consist of independent modules.  3.  The supply network should be designed to supply the basic product to the facilities performing the customization in a cost-effective manner.