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INTRODUCTION
The purpose of this Instructor’s Manual is to provide help and guidance for instructors adopting Strategic Dynamics: Concepts and Cases, first edition.
Brief Overview of Strategic Dynamics: Concepts and Cases
The book is about strategic dynamics in information technology-driven industries.
Strategic dynamics describes the interactions between companies and their environments, which, over time, strengthen or weaken the strategic position and the distinctive competencies of incumbent companies. Information technology-driven industries are characterized by rapid changes in the business environment due to the constant evolution of technology, which in turn necessitates frequent strategic changes. The book offers the opportunity to study the evolution of several information technology-driven industries, starting with the maturation of the microchip, the technological driving force for most changes. It then discusses the confluence of compounding forces that have produced the Internet economy and ecommerce, and others that are currently reshaping the software industry. This is followed by different manifestations of the convergence and/or collision between different industries caused by the digital revolution.
The book studies strategic dynamics with the help of three interrelated conceptual themes. The first of these, titled “strategic action and strategic dynamics,” examines therole of strategy in companies’ evolution and the dynamics that result from the interaction of the companies’ strategic actions with their environment, which often changes. Of particular interest is the case when the environment changes as a result of the strategic action itself.
The second theme studies the relationship between strategy as intended and strategy as reality; that is, stated strategy and strategic action. In particular, we examine what happens when alignment between the stated strategy and the strategic action diverges, as often is the case in rapidly changing environments. When the environmental changes are very large, they create conditions that we call strategic inflection points, periods which represent the possibility of having to choose between alternative strategies, which can further widen the divergence between the possible paths of future development of the companies’ evolution.
The third theme describes the ways different companies navigate such large environmental changes. This often requires corporate transformation, ways companies change in a major way what they do and how they do it. Such transformations require management to navigate and control chaos on one hand and reining in chaos on another, requiring exquisite leadership on the part of a top management.
The book’s structure follows Part 1’s discussion of the evolution of industries driven by information technology, and each of its main parts contains cases that can be studied in light of the three major themes that are also discussed in Part 1. Many of these cases illustrate more than one of the major themes and the choice of which theme to emphasize will depend on an individual instructor’s judgment of what learning each case can highlight best.Wherever possible, I recommend using a technique that Andy grove and I like to call “critical comparative case analysis.” This involves juxtaposing comparable situations in which there are differences in only a limited number of variables, while keeping most conditions approximately the same. By confining the cases to information technology-driven industries, it is possible to find opportunities for such comparative analysis.
Overview of the Instructor’s Manual
Course concept and outline. The Instructor’s Manual includes the course outline of “Strategy and Action in the Information Processing Industry,” which offers an example of how the book is currently used in the elective MBA curriculum of Stanford Business School. If not for its long heritage at the Stanford Business School, the course would be titled “Strategic Dynamics.” In fact Andy Grove and I believe that the book can form the basis for introducing a new course on the topic of strategic dynamics in the strategy curriculum of business schools. One of the unique attributes of the book is indeed that just about all its cases relate to each other in some ways. As a result, it is possible to develop a cumulative learning effect that helps students understand the strategic dynamics of the interrelationships between companies and industries more deeply than is possible with traditional text and cases books in the strategy field.
Teaching notes. For each of the cases presented in the book this Instructor’s Manual offers a teaching note. Some of the notes are longer and more encompassing than others, but they all cover roughly the same elements:
-A brief introduction and suggested assignment questions
-A list of major themes
-An analytical discussion of the assignment questions (related to the themes)
-A summary of key lessons
In some cases, the teaching note presents a suggested teaching plan, but in some others it is left to individual instructors to decide in what order to address the assignment questions and how much time to allocate to their discussion.
Conceptual frameworks. The book’s Introduction introduces several conceptual frameworks that are related to the three key themes of the book and that Andy Grove and I have found useful in analyzing the cases in the book. These include:
-A Framework of Possible States Facing P
-A Typology of Strategic Dynamics
-The Extended Industry Analysis Framework
-Dynamic Forces Driving Company Evolution
-Strategic Inflection Point
-A Framework of the Strategy-Making Process in Established Companies
-Strategies for Crossing the Valley of Death
The teaching notes for the first several cases in the book explain how these frameworks can be used in the class discussion. While this is not repeated for all of the teaching notes, instructors are encouraged to expect students to use the frameworks for their case analyses throughout the book.
Course projects. Andy Grove and I have found that students benefit from actually going out and studying companies struggling with the manifestations of strategic dynamics. One approach we have found particularly effective for doing this is the “Strategic Dynamics Audit.” This involves organizing students in teams of 3 to 5 members that then conduct an audit of a local high-technology company. Through tours, interviews, study of company documents and industry reports, teams can gain excellent insights and learn much. The instructor can ask the best project teams to present their findings to the rest of the class at the end of the course. The appendix to this Introduction shows the “Strategy Audit Framework” used in the abovementioned “Strategy and Action in the Information Processing Industry” course.
Acknowledgements
Putting Strategic Dynamics: Concepts and Cases and this Instructor’s Manual together would not have been possible without the support of the StanfordBusinessSchool. So, thanks to Dean Bob Joss and the Associate Deans of Academic Affairs, David Kreps, Mary Barth and John Roberts, for their support.
Many colleagues, research associates, executives, and students have provided inputs and assistance in writing the cases and teaching notes. They include:
- George Cogan, MBA 1989, for “Intel Corporation (A): The DRAM Decision”
- Ray Bamford, MBA 1996, for “Intel Corporation in 1999” and “Netscape Communications Corporation in 1997”
- Jeff Maggioncalda, MBA 1996, for “Inside Microsoft”
- Sweta Sarnot, MBA 2003, for “BEA Systems, Inc. in 2003: Reaching for the Next Level”
- Christof Wittig, Sloan 2004, for “MySQL Open Source Database in 2004”
- Sami Inkinen, MBA 2005, for “MySQL Open Source Database in 2004”
- Jean-Bernard Rolland, MBA 2004, for “Samsung Electronics in 2004: Conquering the Wireless Digital World”
- Lewis Fanger, MBA 2003, for “Universal Music Group in 2003”
- Cecilia Goytisolo O’Reilly, MBA 2003, for “Universal Music Group in 2003”
-Eric Marti, MBA 1988, for “The U.S. Telecommunications Industry (B): 1996-1999
-Les Vadasz, formerly President of Intel Capital, for “Slouching Toward Broadband: Revisited in 2005” and “Hanging Up the (Old) Phone: IP Communications in 2004”
In addition, Philip E. Meza has been a Research Associate and Teaching Assistant since 1999. He has co-authored many of the cases and has helped put together the text for many of the teaching notes based on my outlines and class plans. For these contributions I decided to list him as a co-author for this edition of the Instructor’s Manual.
Andy Grove and I encourage instructors to use Strategic Dynamics: Concepts and Cases creatively and as best fits their needs and those of their students. We have found studying and practicing strategic dynamics in information technology-driven industries very exciting and very much fun. We hope instructors using our book, and their students, will too.
Robert A. Burgelman
Stanford, CA
October 2005