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What skills should a person have for managing a business unit using a differentiation strategy? Why? What should a company do if no one having these skills is available internally and the company has a policy of promotion only from within?
Research does appear to support the proposition that the manager of a corporation or business unit should be matched to the strategy for successful implementation. Those executives who successfully implement a differentiation business strategy tend to have a high internal locus of control and have more experience in R&D. Because of the likely growth orientation of the strategy, managers should probably have a greater willingness to take risks, a higher tolerance for ambiguity, and sales/marketing experience. These characteristics make sense because of the product/market orientation needed of any unit interested in setting its products or services apart in the competitive marketplace. If this type of person is not available internally, then the company must recruit an appropriate outsider. Under the condition of a promotion from within policy, the policy should be reconsidered and an exception made. Otherwise, the company must take a chance on promoting one of its own - a good reason for proceeding cautiously. 1. When should someone from outside the company be hired to manage the company or one of its business units?
Research on successful firms provides no clear answer to this question. Results are mixed. Research does suggest, however, that firms in difficulty can improve their chances for success if they bring in an outsider who does not have the same devotion to past management practices as do most internal candidates. Certainly, examples can be provided of corporations turning to external turnover specialists (sometimes called "hatchet men") to regain their past success by firing "deadwood" and eliminating popular, but unprofitable divisions, units, and projects. The probability of hiring an outsider to
Research does appear to support the proposition that the manager of a corporation or business unit should be matched to the strategy for successful implementation. Those executives who successfully implement a differentiation business strategy tend to have a high internal locus of control and have more experience in R&D. Because of the likely growth orientation of the strategy, managers should probably have a greater willingness to take risks, a higher tolerance for ambiguity, and sales/marketing experience. These characteristics make sense because of the product/market orientation needed of any unit interested in setting its products or services apart in the competitive marketplace. If this type of person is not available internally, then the company must recruit an appropriate outsider. Under the condition of a promotion from within policy, the policy should be reconsidered and an exception made. Otherwise, the company must take a chance on promoting one of its own - a good reason for proceeding cautiously. 1. When should someone from outside the company be hired to manage the company or one of its business units?
Research on successful firms provides no clear answer to this question. Results are mixed. Research does suggest, however, that firms in difficulty can improve their chances for success if they bring in an outsider who does not have the same devotion to past management practices as do most internal candidates. Certainly, examples can be provided of corporations turning to external turnover specialists (sometimes called "hatchet men") to regain their past success by firing "deadwood" and eliminating popular, but unprofitable divisions, units, and projects. The probability of hiring an outsider to