Strategy as Orchestrating Knowledge

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Ref: Cummings and Wilson: Images of Strategy. Ch 5 Strategy as Orchestrating Knowledge

Proctor and Gamble are different from Unilever despite marketing same products - Idiosyncratic or tacit knowledge

The Role of disintermediation may lead to the Hollowing out of the Organization by outsourcing to the market but collaboration can create new knowledge.

Codifiable explicit knowledge is being commoditized. Even tacit knowledge is under threat

Contents

Deconstruction the value chain - what defensive action can an organization take?

  • Open standards allow companies to add value to the grid
  • Richness and reach of information (Evans Wurster)
  • Focus on a few knowledge-based activities
  • Own the supply chain that people / organizations use. For exampe. Internet Explorer: the network that companies sell programs to or Windows

The new Competitve Model

Physical Product fulfillment Customer
Information Electronic Chnanels Information Provision Customer


The new Value Chain

Core Competence......|Collaborate...Customize...|Co-specialize....|New Capabilities.....|Customer.....|

Four information domains

  • Strategic - Perceptions about the strategic landscape -Parenting - benchmarking
  • Business - Perceptions about competitive environment - Resoures required, positioning
  • Organizational informal formal processes, decentralization / centralization
  • Knowledge - competence base for each organization

Transaction analysis model - Corporate parents

World View....................Mgt Focus .............HQ-SBU reltionship........... ............Knowledge acquisition and infor req at HQ .............HQ Archetypes.................

Archtypes - Lion Tamer/Mentor/Leader/Trainer

  • Canon - Mentor, external focus long-term control is embedded in relationships, cross-boundary learning, double loop, knowledge diffusion
  • ABB - Leader, external focus, medium-long-term, control is discrete, co-ordinated competences, disciplined creativity, self concept enahancement
  • Unilever - Trainer - long-term Centrally managed, single loop, centralized innovation
  • Hanson - Lion Tamer - st central, discrete, efficiency, comformance, compliance, linear communication
  • Mentor - transformational capacity, empowerment, formal/informal networks
  • Trainer - formal stad protocols
  • Leader Economic performance, external performance, formal lateral and hierarchical linkages
  • Lion tamer - operational efficiency, efficiency data, internal targets, formal linear hierarchy

Conclusions

    • Traditional product based definitions of industries will disappear
    • Strategies will become more focused on co-specialized complemenaty best in class
    • CA will be based upon knowledge based individual activity
    • Horizontal strategy - economies of scope across unrelated industries
    • Intermediaries will become flashpoints in the value chain being subject to disintermediation but also potential locus for highly focused competences
    • Formal HQ's to become more informal flexible staged managed to create learning
    • Information processes and knowldege networks underpin knowldege learning
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