Microworlds and Simuworlds: Practice fields for the learning organization

Management is one of the few professions, the authors note, in which members have no formal “rehearsal space” for honing their skills. In response to this need, organizations such as The Center for Creative Leadership, MIT's Learning Center, and The Stern School of Business at New York University have created a brave new world of management simulations—“practice fields” for the learning organization. Some of these new games (“simuworlds”) use computer programs to replicate an entire industry and give participants an opportunity to play out one company's strategy in that setting. Other simulations (“microworlds”) engage participants in complex behavioral role playing, based on scenarios that typically develop within a company. Still other simulations combine both approaches. The authors take their point of departure from Peter Senge's definition of the “learning barriers” that develop in any organization: solving fragmented “problems” rather than dealing with systemic issues; overemphasis on competition at the expense of cooperation; and a failure to innovate until forced to do so. The new simulations, the authors argue, are particularly useful in helping managers learn how to overcome these barriers.     

Towards an holistic understanding of disruptions in Operations Management

The paper reviews the literature on maintenance management, integrates key dimensions of maintenance within a taxonomy of maintenance configurations, and explores the impact of differing configurations on contextual factors and operational performance. “Prevention”, “hard maintenance integration” and “soft maintenance integration” were identified as key maintenance variables. Data were collected from 253 Swedish manufacturing companies, and three distinct clusters were identified. “Proactive Maintainers” emphasized preventive maintenance policies. “IT Maintainers” relied on computerized and company-wide integrated information systems for maintenance. “Maintenance Laggers” emphasized all maintenance dimensions to lesser extent than the others. The importance of maintenance prevention and integration differ between contexts. There were subtle performance differences across identified configurations, but preventive and integrated maintenance were more important for companies seeking competitive process control and flexibility. There existed no group with any great emphasis on all three maintenance dimensions, but attaining truly high performance may require a rare mix of the three dimensions. This mix of variables could constitute a hypothesized “World Class Maintenance” group.     

Load-limited order release in job shop scheduling systems

This report examines the practice of using work load limits to control the release of orders to a job shop. Load limits function in the following general way. Whenever the inventory of work at a work center exceeds some critical value (its “load limit”), further release of orders which are routed to that work center are blocked from entering the shop. After the inventory is “worked off,” release of work to the shop gateways is again permitted. Load-limited order release is intuitively appealing because it appears to be a method for reducing system inventory and flow times. The practice of load limiting order release is becoming popularized by some of the recent production planning software products now on the market. A notable example is OPT. In this report, analytical results for an M/M/1 queueing model, along with existing simulation studies of multi-machine job shops are interpreted to form a theory about the effects of using load limits.The major finding here is the proposition that system flow time, inventory, and order tardiness all deteriorate to the extent that load limits introduce idle time into the schedule. Based on the arguments presented here, a very cautious approach toward the use of input control schemes for anywhere but gateway work centers would be advised. The conclusions drawn here are to a great extent arrived at by interpreting the research results of others, so there is a clear need for further research which tests these assertions in a more direct and controlled way.     

Coordination in operations: A taxonomy

This paper proposes a taxonomy of coordination study in operations. Its point of departure is the assumption that coordination study in operations always involves a “system” which can be a mathematical model, a software system, a business process or a game. A system is the unit of analysis in the taxonomy. In the taxonomy, systems are first divided into three categories depending on the type of coordination - coordination within operations, cross-functional coordination and inter-organizational coordination. Systems are further divided depending on how people in the organization behave, i.e., the perspective of organization. We propose three alternative perspectives of organization - single-person perspective, team perspective, and nexus-of-contract perspective of organization. Through a series of examples, we describe nine subcategories of systems.     

The challenge of computer-integrated manufacturing

Recent years have seen major changes in the pattern of industrial production. Three forces have been particularly significant in driving industry along the road to advanced automated production; growing international competition, the example of Japan and the availability of new technology. Their combined effect is a trend towards advanced and integrated manufacturing systems.These changes require what are often radical adjustments in the philosophy of production management, away from traditional concerns with discrete operations and towards a total systems management approach.This paper examines some of the features of the challenge posed to production management by the technological changes embodied in the “factory of the future”.     

About “strategy” and “strategies” in supply management

This article addresses the context and content of a generic supply strategy and discusses its strategy-making process. Building mostly on fundamental strategic management theories, the authors explain the role of supply strategy in its managerial context. In so doing, some light is shed on the meaning and use of the terms “strategy” and “strategies”. Also, a practical conceptual framework for supply strategy formulation is provided. The generic checklist, built by segmenting supply management decisions, is intended to guide supply professionals in addressing strategic issues to create value to customers, avoiding confusion and optimising resource allocation.     

Integrating sustainable development in the supply chain: The case of life cycle assessment in oil and gas and agricultural biotechnology

It is widely accepted that firms play an important stewardship role in addressing sustainable development concerns. A key challenge in this role is to balance the often conflicting pressures created by sustainable development—firm-level economic performance versus environmental degradation and social disruption. Drawing on complexity theory, risk management, stakeholder theory and the innovation dynamics literature, we discuss the problems of integrating sustainable development concerns in the supply chain, specifically the applicability of life cycle assessment (LCA). Many authors have emphasized the importance of the “cradle to grave” approach of LCA in optimizing closed-loop supply chains, improving product design and stewardship. Based on two case studies (an agricultural biotechnology and an oil and gas company) with supporting data collected from key stakeholders, we argue that sustainable development pressures have increased complexities and presented ambiguous challenges that many current environmental management techniques cannot adequately address. We provide a framework that addresses these deficiencies and discuss implications for practitioners and management theory.     

Management by decree. Paradoxes in the reform of the Italian public sector

A call for “better” governance of the public sphere informed by reliance on management and accounting expertise has recently arisen in connection with a variety of legislative initiatives enacted in Italy. This paper looks at the nature and role of this “reform”, and in particular the call for the introduction of managerial accounting. It is argued that far from facilitating a comprehensive introduction of managerial vocabulary and knowledge into the public domain, the Italian legislative mechanism tends to hamper the expression of management and accounting as technically autonomous and coherent systems, while at the same time allowing more established audiences to deliberate on their nature and role. Although the reform was devised in terms of introducing the economic and the measurable into the domains of bureaucracy and formal compliance, its legal articulation seems to be informed by the very logic and ethos it is called upon to change.     

Service Guarantee Strength: The key to service quality

While most authors describe a service guarantee as a “zero-one variable” indicating the presence or absence of an explicit written service guarantee, this paper develops a construct called “Service Guarantee Strength” (SGS) that is a continuous variable. This construct measures the degree to which a firm sets clear service quality standards for itself on dimensions that customers care about, and has an formal policy for quickly giving meaningful compensation to customers when these standards are not met.The paper builds upon established micro-level behavioral theory to develop the “Service Guarantee Strength Framework”. This framework posits that high Service Guarantee Strength leads to improved service quality, customer satisfaction, and loyalty through three intervening variables—marketing communications impact, employee motivation and vision, and learning through service failure.An empirical investigation was conducted to test the SGS Framework using both employee and customer data from three pairs of firms, with each pair in a different industry. None of these firms had an explicit service guarantee. Unlike many behavioral research studies, this study measured both employee and customer perceptual data and compared the two. The research finds that Service Guarantee Strength is positively related to customer perceptions of service quality, customer satisfaction, and loyalty.     

Applications of decision support and expert systems in flexible manufacturing systems

Flexible manufacturing systems (FMS) increase the efficiency of operations by improving cost, quality, and lead time while decision support and expert systems (DSS&ES) improve the effectiveness of manufacturing by assisting the decision maker in coordinating all the elements and increasing the overall utilization of the factory, particularly in managing a complex system of flexible manufacturing. This article surveys a number of available decision support and expert systems applications in flexible manufacturing after reviewing the features of each one and then proposes additional potential applications.It appears that what is holding back the widespread use of FMS is not the technology, but is some management issues. Application of DSS&ES enables a manager to obtain a full flexibility of equipment in terms of machine flexibility, product flexibility, process flexibility, operation flexibility, routing flexibility, volume flexibility, expansion flexibility, and production flexibility. Many decisions are made in planning and operating FMS that can be categorized into three classes of strategic, tactical, and operational decisions. Each class can be further categorized into structured, semistructured, and unstructured decisions. The article provides examples of FMS decision in each of nine groups and show that use of DSS&ES can be productive.Illustrative cases are categorized into (1) DSS in FMS, (2) DSS in related manufacturing operations, (3) ES in FMS, and (4) ES in related manufacturing operations. The cases described include ICAM, REACT, KEE, PADMS, IMS, FADES, GARI, TOM, ISIS, and GENPLAN.The article finally provides hints for successful DSS and ES implementation. Subjects include getting management involved, choosing a key application, manage vendor involvement, paying attention to maintenance, assigning qualified personnel, paying attention to training, and always reviewing the results.FMS is basically a computer-based system and so are DSS and ES. There is an increased trend of integrating independent computer-based systems to take advantage of the possible synergy of such integration. At present, there is only a little evidence of DSS and/or ES applications in FMS. However, there is increasing evidence of applications in related manufacturing areas. Furthermore, the planning and operations of FMS require considerable expertise; DSS and ES techniques are aimed at supporting or even replacing such expertise. Therefore, it seems that there is a considerable potential for further application of DSS and ES in FMS.     

The cultural significance of accounting in Japan

We have had a spate of works on “Japanese Management” in the world, but very few on “Japanese Accounting”. In this article it is made clear that the functioning of accounting is contingent on the culture in which the accounting systems are incorporated, and that in order to discuss this intermingling of accounting and culture a perspective elaborated in Scandinavia can be relevant despite the uniqueness of Japanese culture. For only non-rationalistic or “naturalistic” perspectives can provide a basis for understanding the cultural dynamics of Japanese organizations and Japanese society. Thus the roles of accounting in Japan go far beyond what has been discussed in accounting textbooks.     

A typology of de-coupling strategies in mixed services

A typology of a class of service systems is proposed. The typology links strategic operational objectives to the decision to de-couple work between the front and back offices of a service system. Four specific ideal types of a strategy/de-coupling mix are described; each of which has distinct operational, marketing and human resource ramifications. A type that has had significant representation in traditional literature is the “Cost Leader” type, where back-office activities are de-coupled from the front office for the purpose of lowering costs. Another traditional type representative of the craftsman legacy is the “Personal Service” type, which retains back-office tasks in the front office to pursue non-cost-oriented strategic goals. Theoretical and empirical evidence is also given for two non-traditional types: the “Kiosk” type, where all tasks remain in the front office to achieve lower costs, and the “Focused Professional” type, which de-couples front- and back-office activities to enable front-office workers to provide higher service, rather than to reduce costs. Empirically, retail bank lending systems are analyzed to support the typology.     

An engineering approach to LSE modelling of experience curves in the electricity supply industry

This review is a supplement to the paper by Sharp and Price (1990) and should be regarded as an alternative engineering approach to the modelling and forecasting of experience, or learning, curves. It highlights the problems associated with accurately defining a model to time series that show a combination of a continuous trend and a cyclical component, as detected by the authors in the Sharp and Price data. The authors give a number of alternative perspectives of the same time series, in this case average thermal efficiency data from the U.K. electricity supply industry, with the corresponding conclusions associated with each approach. Particular attention is drawn to the use of the “time constant learning curve” quoted by Sharp and Price which the authors show is a reasonable predictor of the average thermal efficiency. However, a tremendous improvement results from selecting the “ripple” model as a thermal efficiency predictor.     

Shifts in autonomy, responsibility and control from centre to periphery in public administration: the case of the ministry of finance in Italy

In tackling administrative reform and in the hope of improving the effective allocation of resources, most European governments have shown a growing interest in adopting private sector management models in the public administration. The assumption underlying this paper is that the decisive variables in the different national contexts have to do with the relationships between the central and the peripheral administrative levels, and the way in which administrative actors at the two levels interpret their roles and participate in the reform process. The paper examines the case of the reform of the Italian Ministry of Finance. In seeking to improve its performance and the services it provides, the ministry reform is intended to introduce a management system in which the key concepts are the planning, programming and control of administrative action and results. According to reform rhetoric, shaping a new class of administrative managers at the local level is the crux of the question. However, research results hint that the “creation” of this new local executive staff is yet to be completed. The working hypothesis advanced is that this is due to local executives’ lack of confidence in the “system”, inasmuch as the reform process has so far been characterised by a tendency to give them responsibility without autonomy and autonomy without control. The greater their lack of trust, the lesser their willingness to risk the consequences of failure and the greater their tendency to stick to defensive positions and to return to previous “bureaucratic” conceptions and ways of operating.     

“100% EDI-connected suppliers” projects: An empirical investigation of success factors

Electronic Data Interchange (EDI) is becoming increasingly important, and new organizational forms based on EDI suppliers’ capabilities are emerging. Therefore, taking advantage of recent technological changes, especially the development of Web-based EDI systems, many big industrial buyers are seeking to get all their suppliers EDI-connected. Based on previous research on EDI adoption, we conducted a survey to study the opportunities of success of such a “100% EDI-connected suppliers” policy using data from the vehicle industry. Findings from our survey helped us to understand suppliers’ responses to such a policy and to provide recommendations to industrial buyers who are seeking to succeed in a “100% EDI-connected suppliers” project. This includes employing tailored communication strategies and selecting appropriate incentives that take into account different levels of suppliers’ EDI-capabilities and suppliers’ dependence.     

The use of simulation in system design: A case study using the precision location strike system

The purpose of the article is to illustrate the use of computer simulation study and modeling in the design of complex systems. When new systems are designed, decision-makers rely heavily upon judgment, intuition and experience. The method discussed is intended to enhance these executive attributes by providing a vehicle with which the decision-maker may be proactive before implementing the system rather than being solely reactive after implementation.The application of a method known as the “systems science paradigm” is discussed and illustrated using the U.S. Air Force's Precision Location Strike System. The problem was to design a logistical support structure for the Strike System. The three major options proposed were to locate repair and resupply structures at the point of equipment use in Europe, to have a mixed system, or to locate support at a base in the continental United States.The research employed the paradigm suggested to develop an experimental Q-GERT simulation model of the processes and structures envisioned. Data development for abstract systems is illustrated and methods to experiment with alternate structures are developed and discussed. The concept of multiechelon inventory and repair are addressed within the problem's context.A proposed design alternative resulted from application of the process. Methods, other than cost effectiveness, to evaluate the system are also suggested. Implementing the design process for ill-defined systems appears to be an effective method for dealing with such design problems.     

Managerialisation processes and performance in arts organisations: the Archaelogical Museum of Bologna

The extension of management discourse to public-sector entities in Italy comes up against a particularly interesting case in museums and art organisations. Here more than anywhere else, perhaps, the rhetoric of managerialisation faces serious problems in understanding the nature of such anomalous organisations, and defining frameworks for representing their performances. In such a context management knowledge often leads to radical conflicts with well established professional discourses (museology, museography, history of art, etc.). Rather than a simplistic, pre-defined and ready-to-use exercise in “performance valuation”, the article suggests a more modest approach, processual in nature, whereby performance representation is open to dialogue with the basic features of the substantive culture of the professionals and the central role they still occupy in the management of these kinds of organisation.     

Use transnational teams to globalize your company

The authors report on their two-year study of successful transnational teams, in which they examined how such teams are designed and managed to help their firms pursue global business strategies. Based on this study, they present a comprehensive model of team effectiveness that includes the key characteristics differentiating a transnational team from other types of work teams. The model shows how transnational teams operate—how they are staffed and led, communicate across great distances, and cope with cross-cultural issues. In closing, they describe how a company's human resources department can help an “international” or “multinational” team become a “transnational” team—one that has successfully transcended the cultural, geographic, and managerial barriers to team effectiveness.     

Implementing organizational change in supply towards decentralization

This paper presents the findings from research in large companies investigating implementation issues faced by chief purchasing officers as their supply organization changed to greater decentralization. Once the decision was made to decentralize, responsibility for implementation was given to the chief purchasing officer (CPO). Firms changing their supply organization to a more decentralized structure faced a number of implementation issues, including the business unit concerns, role of the chief purchasing officer, top management involvement, changes to existing purchasing staff and the involvement of consultants. In the nine changes studied across seven companies, the decentralization process also required the CPO to address a number of simultaneous activities, including cost reduction objectives and implementation of information technology systems. A surprising “purchasing paradox” was also uncovered as top management still expected decentralized supply units to provide additional savings.     

Measuring the Measurable: Why can’t we Agree on the Number of Telecommuters in the U.S.?

Using telecommuting as a case study, we demonstrate that definitions, measurement instruments, sampling and sometimes vested interests affect the quality and utility even of seemingly objective and “measurable” data. Little consensus exists with respect to the definition of telecommuting, or to possible distinctions from related terms such as teleworking. Such a consensus is unlikely, since the “best” definition of telecommuting depends on one’s point of reference and purpose. However, differing definitions confound efforts to measure the amount of telecommuting and how it is changing over time. This paper evaluates estimates of the amounts of telecommuting occurring in the U.S. obtained from several different sources: the U.S. Census, the American Housing Survey, several Work at Home supplements to the Current Population Survey, a series of market research surveys, and the trade association-sponsored Telework America surveys. Many of the issues raised here are transferable to other contexts, and indirectly serve as suggestions for improving data collection in the future.