|
Executive Interviews: Interview with Donald N Sull on Why Good Companies Go Bad
January 2007
-
By Dr. Nagendra V Chowdary
Donald N Sull Associate Professor for Management Practice at the London Business School 
From your elaborate research on
commitment and conviction levels,
can you elaborate on the factors responsible
for increased commitment
and conviction levels of employees?
What role does culture (the society
that an employee comes from) play
in shaping up these two attitudes?
The role of national culture is fascinating.
I have heard many times
people say that their national culture
runs counter to the corporate culture
required to succeed globally. That
may be true, but it is also irrelevant. The companiesmentioned above succeeded
by creating a culture that differed
fundamentally from the prevailing
|
|
norms and values in the business
community as whole in their country.
AmBev introduced a value of winning
into a sleepy Brazilian business
culture, while CEMEX CEO Lorenzo
Zambrano instilled a deep sense of
ambition to compete globally in his
company, despite a prevailing business culture in Mexico of
avoiding global competition.
If leaders can articulate
and imprint a strong set
of values in an organization,
they can always find
employees attracted to
these values. These individuals
would be misfits in
most other companies in
those countries, but can
thrive in a context aligned
with their values. To give a
concrete example, Brazils
AmBev recruited employees
who were considered
too competitive in many
Brazilian firms, but then
went on to harness the energy
of these employees to
rise to global leadership. You have suggested identifying
the gaps between
what matters most to you
and how you are investing
your resources. How frequently
should this exercise
be carried out? What
is the idealway of carrying
out this exercise?
Now, we are switching from
theorganizational tothepersonal
level. To me this is a
simple exercise of periodically
setting aside time to reevaluate
your convictions,
which might shift in emphasis
over time, and evaluate
your allocation of time,
energy and money to activities
that support these aspirations.
I typically do this
exercise once a year aftermy
summer holiday, which
marks a break from the day
to day routine. The trick is
not the exercise itself,
which is quite simple, but
the discipline to do it on a
regular basis, and the courage
to act on the findings. There are two divergent
lines of thinking in strategy
making: one represented by Henry Mintzberg
arguing that strategy is an emergent process;
and others argue that its an intended and a
deliberate process. What according to you is
the right way of understanding strategy? Are
there evidences to support this line of thinking?
To me the traditional distinction between emergent
and deliberate strategy is a false dichotomy.
All strategy always retains an element of deliberation
(figuring out what is going on in the
world and making a plan) and emergent (responding
to external events). A more helpful
way of distinguishing strategies in my opinion
is linear versus iterative approaches. The linear
approach assumes that a leader can envision the
future, create the perfect plan or vision at the
beginning, then implement the resulting strategy.
This is how strategy is taught in most business
schools divided into a strategy formulation
stage followed by a strategy execution stage.
My research suggest that the most successful
firms, at least in turbulent markets, follow a
more iterative approach, where leaders first
make sense of the situation, then make choices
about what to do, what not to do and what to
stop doing, then make it happen by executing
on agreed objectives, and finally making revisions
by revisiting initial assumptions and comparing
them against what actually happened.
An iterative process views strategy and execution
as intimately linked, and indeed inseparable.
If your readers are interested, I wrote a
paper about this in 2007 in the Sloan Management
Review, entitled Closing the gap between
strategy and execution.
1.
The Good, the Bad and the Ugly Case Study
2. ICMR
Case Collection
3.
Case Study Volumes
|
