Page 23 - Managing Change in Organizations

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Chapter 1 ■ The challenge of change
A recent proponent of this view is Markides (2000), for whom sustaining
advantage is achieved by:
1 Organizing its various activities into ‘tight’ systems which support and rein-
force each other. In essence the advantage is sustained because, while imitators
may adopt various ideas and techniques, the ability to manage interfaces really
well is difficult to copy.
2 Creating an underlying organization environment of culture, structure, incen-
tives and people, which is also difficult to copy.

Both describe alignment, but Markides goes on to argue that success now often
comes precisely by avoiding the tendency to copy. Instead of competing head-to-
head with an existing set of competitors, each with well-protected positions, the
key is to create a new strategic position by changing the rules of the game.
Examples include Body Shop, CNN, Dell, Direct Line Insurance, easyJet, Federal
Express, Ikea and Swatch among others. Markides offers a useful framework for
considering strategic innovation which, summarized, goes as follows:
Question the status quo and scan the environment – for sector and your
business.
Does this lead to a potentially new strategic position?
If you adopt this position, can you find synergies with existing business?

The Kay view takes the idea of core competence as a part of strategic architecture.
Grunig and Kuhn (2001) develop these ideas into a clearer analytical framework.
For them the evaluation of success potential for strategy (building on Ohmae,
1982) requires the assessment of market and competitive strength at three levels:
1 Market position Market attractiveness
Competitive intensity
Market share
Growth/decline of share
2 Market offers Scope and range
Quality and service
Add-ons
Price
Speed
Including measures relative to competitors
3 Resources Sustainability of competitive advantage (rarity,
unitability, substitution)
Following through with the resource-based view of strategy these authors note
that it is possible to adopt either an ‘outside-in’ approach to assessing success
potential (the market-based view) or an ‘inside-out’ approach (the resource-based
view). However, they regard the latter as being the exception rather than the norm.
Nevertheless what is interesting in their formulation is the way they track from
assessing success potential through to the concept of the balanced scorecard (fol-
lowing Kaplan and Norton, 1996) and on into the definition of implementation

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