Issue 4, 1994

Emerging Technologies: A Novel Approach to Envisioning Their Development

Stephen E. Rudolph, Mehmet Rona, and Holly Ripley-Boyd

Just beyond the typical business time horizon are significant new technologies that will change our lives. These emerging technologies, not yet fully realized and still outside the arena of competition, will create enormous opportunities – and huge threats. Each of these technologies tends to be 10 to 15 years from full implementation and to involve multiple, sometimes competing, constituent technologies. Typically, some parts of the technology have been demonstrated, while others are still very much in the research stage. Current examples include virtual reality, micromachines, smart materials, moldless forming of parts, wireless power transmission, electric vehicles, and nutriceuticals. [...]

Issue 4, 1994

Integrated Product Definition: Using QFD for the Business of Product Development

John M. Collins and Arthur D. Schwope

Quality function deployment (QFD) techniques have long been recognized as a potentially invaluable tool in successful product development. QFD techniques provide a systematic methodology for translating market opportunities and customer needs into clear product specifications that engineers and scientists can use for design, formulation, and development. But despite QFD's long history of success stories, companies have not yet come close to realizing its full potential for enhancing either product development or other business processes. [...]

Issue 4, 1994

The Chief Technology Officer as an Agent of Change

Nils H. Bohlin, Herman J. Vantrappen, and Alfred E. Wechsler

Peter Drucker wrote in one of his many insightful essays: "The source of wealth is knowledge. If we apply knowledge to tasks we already know how to do, we call it productivity. If we apply knowledge to tasks that are new and different, we call it innovation." He went on to say that "the two beacons of productivity and innovation must be the guideposts of industrial management and leadership." [...]

Issue 4, 1994

Managing Multinational, Multicultural R&D

Craig Tedmon, Jean-Philippe Deschamps and Richard Granger

Jean–Philippe Deschamps: We read a lot about the ABB culture but surprisingly little about the technology side of your multinational, multicultural business. Would you describe the organization of the technology resources within your overall global/local network? [...]

Issue 4, 1994

Managing Technology on a Global/Local Basis for Optimal Synergy

Christian Mouthuy

Over the last decade, many large organizations have faced the challenge of intensifying international competition – within, their own domestic markets, across continents, and even worldwide. As their competition has become global, so too has their manufacturing, as they have tried to reap the twin benefits of scale and low–cost regional production. For most such organizations, there has been only one way to "go global" fast enough: by acquiring local businesses as rapidly as possible to gain direct access to local markets. The rapid growth of ABB over the past decade exemplifies the formidable leveraging power of such a strategy. [...]

Issue 4, 1994

Technology Assessment - Are You Doing It Right?

Mildred A. Hastbacka and C. Gail Greenwald

If you're involved in a technology–based business, chances are good that right now you are making investment decisions that will affect your business performance into the next century. You may be launching (or killing) a new R&D project, evaluating competing technologies for a new product idea, or acquiring a company that could catapult you to technical and market leadership. You may even be making decisions about the impact of technologies that haven't been developed on markets that don't yet exist. [...]

Issue 4, 1994

Measuring the Performance of the Innovation Process

Herman J. Vantrappen and Philip D. Metz

When executives examine how smart their innovation processes are, the soul–searching involves questions of effectiveness, efficiency, and risk. How does the company's record of success in innovation stand up against competitors'? Does the company achieve an adequate return on its investments in technology? Is the company's innovation process sufficiently under control to improve the predictability of results? [...]

Issue 4, 1994

Managing the Marketing/R&D Interface

Jean-Philippe Deschamps

Many CEOs, looking at the considerable resources their companies invest in R&D, can't help wondering whether they are getting commensurate revenue growth. Hence the popular complaint: "I suspect that half my R&D investment is wasted, but I don't know which half...." Many also feel disappointed with their firms' failure to produce true innovations, as opposed to product line extensions. [...]

Issue 3, 1994

Doing More With Less: Improving Environmental Management Productivity

John S. Willson and J. Ladd Greeno

In recent years many companies have made impressive gains in strengthening their environmental, health, and safety (EHS) management. But they have also seen their EHS costs increase dramatically – to as much as 4 percent of sales and even more. As a result, EHS budgets have joined other once–sacred functions – such as finance, legal, and information systems – as candidates for rigorous cost–cutting. Today, companies are actively seeking ways to improve the productivity of the resources they devote to managing their EHS activities. [...]

Issue 3, 1994

Information Management

Robert M. Curtice and Samarjit Marwaha

If you believe the pundits and the business theorists, we live and work in the Information Age. Our companies are populated by an intriguing new species called the "knowledge worker." And our organization charts are being ripped apart in the name of reengineering – an information–technology–driven phenomenon. [...]

Issue 3, 1994

Manufacturing Management

Anthony J. Lynch, Arun Maira, and Anjan C. Mehta

Over the past decade, we have heard a lot about the perilous decline of manufacturing in the United States. Yet a review of key indices, adjusted for inflation, reveals an altogether different picture. For instance, hourly output has been rising at almost 5 percent a year for the past three years. The American worker is the most productive in the world, producing on average 10 percent more in goods and services than German workers and 20 percent more than their Japanese counterparts. In fact, U.S. productivity has been growing at an annual rate of 2.5 percent, more than twice as fast as the average between 1970 and 1990. [...]

Issue 3, 1994

Leveraging Customer Value

Deborah M. Adamian, Pamela W. McNamara, and Marc D. Rubin

At the invitation of Arthur D. Little, Inc., executives from a number of leading companies met earlier this year to discuss state–of–the–art advances in one key area of growth: leveraging customer value (LCV). LCV is the set of activities by which companies select, attract, and retain profitable customers, and thereby maximize value over time. [...]

Issue 3, 1994

Supply Chain Management

James A. Welch and N. Laddie Cook

Chief procurement and logistics executives from 12 influential companies – representing combined revenues of some $360 billion – met at the Arthur D. Little Colloquium on Supply Chain Management. They rubbed shoulders, shared insights, and "pushed the envelope" of the state of the art in this field. [...]

Issue 3, 1994

Product and Technology Management: Learning to Juggle in the Age of Paradox

Ronald S. Jonash, Philip D. Metz, and Bruce McK. Thompson

The leading–edge R&D executives who gathered to discuss product and technology management at the Arthur D. Little colloquium represented companies of vastly different sizes, industries, cultures, and histories. Yet as the two–day session unfolded and participants identified their key challenges and best practices, there was a clear congruence of experience. These senior managers saw the world through much the same eyes – whether their companies made prescription drugs or postage meters, satellites or shaving products, mailing labels or military hardware. And they shared many of the same goals and frustrations. [...]

Issue 3, 1994

Best Practices and Beyond

Tamara J. Erickson

Last spring Arthur D. Little convened six colloquia – stretching from northern California to southern Florida – to which we invited executives from some of the world's most innovative companies. It was an experiment in collaborative learning. We asked the executive participants, working with a team of Arthur D. Little consultants, to tackle the toughest problems currently facing managers of several critically important business processes: new product development, supply chain management, customer service provision, manufacturing, information management, and safeguarding the environment. For each process, the goal was to identify and document best practices, anticipate the next set of critical challenges and opportunities, and create a body of insights – thought leadership – that would help other executives improve their operations. [...]

Issue 2, 1994

Viewpoint The Information Superhighway

Peter B. S. Ellis

Prognostications on the information superhighway range from the starry–eyed to the deeply pessimistic. In this article, we propose to present a realistic, balanced assessment of precisely what the information superhighway is, what it will do, and how it will develop – or, more accurately, how it will continue to develop. Those taking a cynical view of the information superhighway miss one critical fact: much of the highway is not a future development – it's here and now. [...]

Issue 2, 1994

Viewpoint Hitchhiking on the Information Superhighway

David L. Fishman

There is some uncertainty about who first coined the phrase, "the information superhighway." U.S. Vice President Al Gore takes credit for coming up with this felicitous phrasemaking as early as 1978. In the car–crazy U.S. culture, the metaphor quickly occasioned a deluge of clever wordplay. Miles of print and emission clouds of rhetoric trumpeted metaphorical "speed limits," "learner's permits," "jackknifed trailers," "rest stops," "emergency lanes," "roadkill," and "unlimited mileage" – all deployed to describe variations on an event that might or might not actually take place before the end of the century. The Wall Street Journal even devoted a front–page article to the phenomenon of the "metaphor industry" that had grown up around the information superhighway, and the American Dialect Society voted the phrase "Word of the Year" for 1993. There are, of course, serious questions as to what "the information superhighway" really means and whether it will in fact be built. The answers to these questions vary widely, even among my colleagues at Arthur D. Little. [...]

Issue 2, 1994

Rethinking Growth and Renewal in the 1990s

Tamara J. Erickson and David C. Shanks

Over the past few years, most of the business leaders we know have taken their organisations through some activity to improve operational effectiveness: process redesign, reengineering, organisational restructuring, downsizing, etc. To varying degrees, these initiatives have brought improvements. Many companies are in fact "leaner and meaner." And while this process will continue – because there is always room for more improvement – many companies are now turning their attention from inside the company to the outside world. They are wrestling with the question: Now that we have an increasingly well–tuned machine, where should we point it? After all, a company's success will depend not only on its ability to perform, but on its foresight in choosing the right arenas of performance. Companies that lack this foresight – that place their bets at the wrong table – will miss tremendous opportunities. [...]

Issue 2, 1994

Failing to Change: The Plight of the Japanese Computer Industry

Mochio Umeda

Japanese companies are still suffering from low earnings and profits, legacies of the collapsed "bubble economy" of the late 1980s. Among the sufferers are the biggest electronics firms in the country: Fujitsu, Hitachi, Mitsubishi Electric, NEC, and Toshiba. Some industry observers believe that the good times will return when the economy improves. We say they won't – unless the Japanese electronics industry makes some big changes. [...]

Issue 2, 1994

Recreating the Argentine National Oil Company: A Paradigm for Privatisation

Christopher E. Ross

As has been widely documented, Argentina is in the process of dramatic change from a centrally controlled economy with protected markets to a competitive economy with open markets. The pace of change and its evident success testifies to the leadership of President Carlos Menem, who took power in July 1989. A central pillar of the change process is the privatisation of state companies, of which YPF – the Argentine national oil company – has been the most dramatic example. In just two years, YPF transformed itself from a lumbering behemoth of 39,000 people with widely diversified activities, protected from competition, into a lean, efficient, highly competitive oil company whose initial stock offering was widely hailed as marking one of the most successful privatisation efforts of our time. YPF's story offers useful lessons not only for companies undertaking privatisation, but for all organisations striving to change. [...]

Issue 2, 1994

Reengineering Revisited: Achieving Seamlessness

Laurence P. Chait and Anthony J. Lynch

Some people assume that reported failures in business process redesign (BPR), also known as reengineering, sound its death knell. We see such predictions as grossly premature. BPR will be with us indefinitely, for the simple reason that BPR, done right, creates tremendous improvements in business processes. But it must be done right. [...]

Issue 2, 1994

Managing Transformational Change

Arun N. Maira

The pace of change is faster than ever before – and accelerating. While new technologies transform the ways people work and the ways businesses operate, new markets, with enormous potential, are opening up in Asia, Eastern Europe, and Latin America. Unforeseen competition – from different countries, different products, and even players in different industries – is blind–siding many corporations. And regulatory changes are creating whole new playing fields. [...]

Issue 1, 1994

Viewpoint Maastricht Doesn't Matter - European Business Strategies Do

Tom Sommerlatte

European market integration has been one of the great economic success stories of the past 30 years. But the movement seems to have lost steam. In fact, as the much-hailed "Europe '92" arrived, most European economies found themselves in severe recession. There is no evidence that the promises of the highly publicized Cecchini Report of 1987 will be fulfilled. And there is no sign of either the expected additional 4 to 7 percent growth in the European gross domestic product or the creation of 1.8 million new jobs. In fact, GDP growth is next to nothing, and trade is stagnating. [...]

Issue 1, 1994

Leaders' Perspectives on Business Ethics: An Interim Report

John F. Magee and P. Ranganath Nayak

We are engaged in a series of conversations with chief executives of large international companies about the ways they define, promulgate, and implement standards of ethical behavior in their firms. This progress statement is intended in part to prompt responses from Prism readers. We hope that your thoughtful comments on our tentative conclusions may enlarge the scope of these conversations and contribute to our own understanding of this complex and elusive subject. [...]

Issue 1, 1994

Transnational Corporations and Global Environmental Policy

S. Noble Robinson, Ralph Earle III, and Ronald A. N. McLean

Ten years ago, "environmental" was not a very important word in the business lexicons of most transnational companies. Today, many of these companies have made superior environmental performance a worldwide priority. They express their commitment in written environmental policies and manage environmental performance not only to comply with local standards, but to achieve continuous improvement and keep pace with the inexorable rise in global environmental expectations. [...]

Issue 1, 1994

Doing Business in China: The Dragon Gathers Speed

L. Ray Kelly

The breakneck speed of China's development and growth since the introduction of its "open–door" policy in 1979 has set the stage for what many believe will be the emergence of China as the next economic superpower. Already, the Chinese economy, measured in terms of purchasing–power parity exchange rates, is exceeded only by those of the United States and Japan. A market of 1.2 billion people with an estimated effective per capita income of $1,800 per year, a historically high savings rate of 3 5 percent of GNP (compared to a U.S. rate of 15 percent), real growth rates of 10 percent per year, and the need for major infrastructural investment does indeed present a very attractive proposition. Assuming a continued growth rate of 6 percent per year, China's economy would exceed that of Japan by the year 2000 and that of the United States by the year 2030. But can China continue on this path? Is the investment climate in China really ripe for serious consideration by foreign investors? [...]

Issue 1, 1994

Benefiting from NAFTA: New Opportunities in North America

Roberto E. Batres

A rather experienced Mexican president, Porfirio Diaz – he was in office 36 years – portrayed his nation's basic attributes in the following way: "Pobre México, tan lejos de Dios, tan cerca de los Estados Unidos." ("Poor Mexico, so far from God, so near the United States.") It's this basic fact of life, of course, that led to NAFTA – the North American Free Trade Agreement. In this article, I will provide an overview of the trends that are behind NAFTA. I will also address the challenges and opportunities that this newborn free trade area creates for US. and Canadian firms. [...]

Issue 1, 1994

Redesigning the Multinational to Compete Across Europe

Tim Simpson and Roger Camrass

One of the frustrations for European consumers is that they pay more than their U.S. counterparts across a whole range of goods and services. A computer that sells for $1,000 in New York may cost £1,000 in the United Kingdom. Compact discs, $12 or less in the United States, typically cost £12 or more. And Jeep Cherokees, now becoming popular in Europe, sell for 50 percent more than the U.S. sticker price. The reason is clear. Most businesses can approach the United States as a single large market, whereas in Europe, although the total population is bigger than that of the United States, businesses must contend with an assembly of individual smaller markets. Competition is less strong here, and less-efficient companies survive. [...]

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About Prism

Twice a year, Arthur D. Little covers the latest cutting-edge thinking on strategy, technology and innovation in its corporate magazine Prism. For over 20 years Prism has continually set the standards in innovative thinking and groundbreaking concepts in the world of business and management.

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