Management Theorists Summaries

Chandler: The Enduring Logic of Industrial Success Main claim: Successful companies exploit economies of scale and scope in capital-intensive industries by investing in: • Production capacity: technology, research & development • Strong management hierarchies • National and international marketing and distribution networks Secondary claims: • The first companies to make these investments dominate their market and are First Movers; they have the upper hand on the Experience Curve and thus a competitive advantage, and they maintain their position through constant innovation and strategy. • Growth through unrelated diversification is a poor business strategy; the right idea is moving into related product markets or to expand geographically • Companies in an oligopoly become stronger through intense competition. • Companies grow horizontally by combining with competitors, and vertically by moving backward to control materials and forward to control outlets. Greiner: Evolution and Revolution as Organizations Grow Main claim: Organizational growth is characterized by five successive developmental phases, each with a management focus and style, and each followed by a predictable crisis; management practices that work in one phase are unsuitable for the next and precipitate the crisis. Secondary claims: • Organizations should not skip phases; some go quickly through them, some regress • Top managers whose style is no longer appropriate should remove themselves • Growth is avoidable • The future of an organization is determined predominantly by its history (behavior is determined more by past events/experiences than by what lies ahead) Phases of evolution (CDDCC): • Creativity: informal, long hours, market feedback • Direction: hierarchy, specialization, formal communication, managers, supervisors • Delegation: decentralized organizational structure, empowering of lower-level managers • Coordination: formal planning, top executives initiate and administrate new systems •