Posted by MIT Sloan Executive Education - 8 hours ago
Projections for the economy in Greece are dire. Economic recovery is not certain, and when it comes, it will certainly be long and painful. And despite BloombergView stating, "While not out of the woods, Greece’s large banks seem to be showing signs of life," there’s still widespread unemployment and an overall bleak outlook.
Phil Budden, Senior Lecturer at MIT Sloan, argues in Fortunethat the current fiscal crisis can be turned into an opportunity for the country. Budden recommends the country and its people follow the advice of Winston Churchill by "never letting a crisis go to waste." Greece might follow the example of other countries that have struggled economically, and it could begin to "gradually shift its focus away from macroeconomic problems and toward the task of creating an innovation ecosystem."
Posted by MIT Sloan Executive Education - 2 months and 16 days ago
Commonality, or the reuse and sharing of components, manufacturing processes, architectures, interfaces, and infrastructure across the members of a product family, is a strategy targeted at improving corporate profitability. Companies from Toyota to GE use product platform strategies to deliver more variety to their customers and compete more effectively. For example, Black and Decker uses shared motors and batteries across a range of power tools. Volkswagen models such as the Jett and TT share similar underbody components and other aspects.
Typical benefits of a commonality, or a product platform strategy, include:
Shared development costs
Common testing procedures
Production economies of scale
Amortized fixed costs
By definition, commonality seems like an obviously good thing. Why incur the cost of making different parts for different products if the parts do the same thing? Because as it turns out, commonality is not always the right thing to do. And even when it is right, it can be difficult to achieve.
Dr. Bruce Cameron is a lecturer in MIT's Engineering Systems Division and a consultant on platform strategies. His research at MIT uses a healthy dose of systems thinking to tease out when commonality makes sense and how to get companies to pull it off. Cameron oversaw the MIT Commonality Study, which closely examined 30 firms over eight years. The study was the first work to uncover that many firms fail to achieve their desired commonality targets, showing weaker investment return on their platform investments. "That type of behavior and phenomenon is seen in studies that we did in automotive, consumer products, and transport," says Cameron.
Posted by MIT Sloan Executive Education - 3 months and 7 days ago
The world is highly complex, and we struggle to manage the complexity of it every day. Most os us accept this complexity as unavoidable, attempting to manage the complex systems we face with complicated solutions. But meeting complexity with complexity can create more confusion than it resolves. So how can people better manage the complexity inherent in the modern world?
Donald Sull, Senior Lecturer at MIT Sloan, swears by simple rules, whether in his personal life or in helping companies he consults with make better decisions. His latest book, Simple Rules: How to Thrive in a Complex World, co-authored with Stanford University's Kathleen Eisenhardt, aims to help more people put these simple rules in practice.
A decade ago, in the course of studying why certain high-tech companies thrived during the internet boom, the authors discovered something surprising: To shape their high-level strategies, companies like Intel and Cisco relied not on complicated frameworks but on simple--and quite specific--rules of thumb. The simple rules these companies had mapped out in order to manage complex processes helped them make on-the-spot decisions, adapt to rapidly changing circumstances, and bridge the gap between strategy and execution. All this even though they were in extraordinarily complex, challenging, and fast-moving industries.
Posted by MIT Sloan Executive Education - 3 months and 18 days ago
Previous posts in our series on innovation* surveyed four of the five skills found in some of the worlds most innovative executives: Observation, associating, questioning, and networking. In this final post in the series, we’re sharing insights on experimenting--the final discovery skill that perhaps best differentiates innovators from non-innovators.
The argument that innovators are experimenters is certainly not new. According to Hal Gregersen, Executive Director of the MIT Leadership Center and co-author of The Innovator's DNA: Mastering the Five Skills of Disruptive Innovators, it's the ways in which they experiment, however, that sets them apart. The innovators in his ongoing research--including founder entrepreneurs and CEOs at the most innovative companies in the world--often generate their best ideas when engaged in one of these three approaches to experimentation:
Trying out new experiences through exploration (think Steve Jobs at an ashram in India)
Taking things apart, either physically or intellectually
Posted by MIT Sloan Executive Education - 3 months and 24 days ago
Networking. It's a word that evokes very different reactions among us. Love it or hate it, you probably associate networking with making your way up the ladder, developing relationships, and expanding your contacts. But if you don't associate it with innovation and breakthrough ideas, then you're missing out on perhaps the greatest opportunity networking can provide.
According to Hal Gregersen, Executive Director of the MIT Leadership Center and co-author of The Innovator's DNA: Mastering the Five Skills of Disruptive Innovators, innovation requiresradically different points of view. As we outlined in previous posts in this series,* innovators have a unique and practiced set of skills that help them acquire these out-of-the-box ways of thinking. Unlike typical delivery-driven executives who network to access resources, innovatorsdriven by discovery. Theydevote time and energy to finding and testing ideas through a network of diverse individuals. They go out of their way to meet with people of different backgrounds and perspectives to extend their own knowledge and get new ideas. Networking is a critical skill not only for generating new ideas but also for mobilizing the resources to launch new ventures.
REAP is a multi-year program designed to help regions promote economic development and job creation by teaching participants how to implement a more robust, innovation-based entrepreneurial ecosystem. The program was created in part to address the concerns of organizations that want to emulate the entrepreneurial spirit encompassed by MIT.
"Singapore has a great opportunity to really build its entrepreneurial capacity and to build innovation-driven businesses," said Fiona Murray, Associate Dean for Innovation and the Co-Director of the MIT Innovation Initiative. Singapore has doubled the number of startups in its country, from 24,000 in 2005 to 55,000 in 2014.
Posted by MIT Sloan Executive Education - 4 months and 8 days ago
What sets truly disruptive innovators apart? According to Hal Gregersen, Executive Director of the MIT Leadership Center and co-author of The Innovator's DNA: Mastering the Five Skills of Disruptive Innovators, innovators have a special set of skills that help them create value-generating ideas. Observation is one of those skills, and one that engages multiple senses. The observations innovators make spark questions that, and as we covered in our previous post on this topic, can challenge common wisdom. Innovators carefully watch the world around them, and they connect common threads among unconnected data. They are keenly aware of what doesn't work and innovate uncommon business ideas to solve them.
For innovators, this observation skill is always turned on. For the rest of us, it's an untapped resource.
Developing your skills of observation
So what does Gregersen's research tell us about improving our own ability to observe, and turning those observations into value? He suggests the following tips for developing this important skill:
In his decade's worth of research into the source of disruptive innovations, Gregersen found that questioning is how innovators do their work—it's the catalyst for other "discovery behaviors" that make up an "innovator's DNA," such as observing, networking, and experimenting. Innovators ask a lot of questions to better understand what is and what might be. They ignore safe questions and go right for the crazy ones--the questions that can question common wisdom and can even disrupt an entire industry.
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