Robert A. Burgelman

A Process Model of Internal Corporate Venturing in the Diversified Major Firm

Examines how major firms utilize R&D activities to create new businesses through internal corporate venturing (ICV). Using a qualitative method, this analysis was done for one large, U.S.-based high-technology firm. This firm has a new venture division, which was formed in the early 1970s. Data were obtained from the study of six major projects that were ongoing at the time of the research. This data collection included interviews with 61 firm employees involved in the projects. The key and peripheral managerial activities of the grounded process model of ICV and the flow of these activities through four venture stages are presented. The four major processes in the model are definition, impetus, strategic context determination, and structural context determination. Among the findings: It is usually the autonomous strategic initiatives of individuals at the operational level that provide the ideas for much of corporate entrepreneurship. As a result of the very autonomous nature of these initiatives, management has difficulty deciding how to deal with the new initiatives and often ignores administrative issues through the entrepreneurial process. Middle-level managers are found to play a key role in linking these autonomous initiatives to the corporate strategy of these diversified major firms. (SRD)

Strategy as Vector and the Inertia of Coevolutionary Lock-in

To examine the consequences of a period of extraordinary success for the long-term adaptive capability of a firms strategy-making process, this comparative longitudinal study of Andy Groves tenure as Intel Corporations chief executive officer (CEO) documents how he moved Intels strategy-making process from an internal-ecology model to the classical rational-actor model during 1987-1998. His creation of a highly successful strategy vector pursued through an extremely focused induced-strategy process led to coevolutionary lock-in with the personal computer market segment, in which Intels strategy making became increasingly tied to its existing product market. Intracompany analysis of four new business development cases highlights the inertial consequences of coevolutionary lock-in. The paper examines implications of coevolutionary lock-in in terms of its effect on balancing induced and autonomous strategy processes and exploitation and exploration in organizational learning.

Designs for Corporate Entrepreneurship in Established Firms

This article presents a model which identifies entrepreneurial activity as a natural and integral part of the strategic process in large, established firms and offers a conceptual framework to help top management assess entrepreneurial business proposals. It also examines various organization designs for structuring the relationship between entrepreneurial endeavors and the corporation.

Let chaos reign, then rein in chaos—repeatedly: managing strategic dynamics for corporate longevity

Combining longitudinal field research and executive experience, we propose that corporate longevity depends on matching cycles of autonomous and induced strategy processes to different forms of strategic dynamics, and that the role of alert strategic leadership is to appropriately balance the induced and autonomous processes throughout these cycles. We also propose that such strategic leadership is the means through which leadership style exerts its influence on corporate longevity. Our findings can be related to organizational research on structural inertia, learning and adaptation, as well as to formal theories of complex adaptive systems. They also contribute to resolving the seeming contradiction between a study of corporations that attributes exceptional long-term success to leadership style, and the more common proposition that strategy is the determinant of long-term performance.

Managing the Strategic Dynamics of Acquisition Integration: Lessons From HP and Compaq

We propose a conceptual framework that decomposes the overall acquisition integration process into four sequential and co-evolving processes: (i) formulating the integration logic and performance goals, (ii) establishing the integration planning approach, (iii) executing operational integration, and (iv) executing strategic integration. Managing the strategic dynamics of acquisition integration in fast changing competitive environments requires attention to all four processes and the feedback loops between them. Our analysis of the HP-Compaq merger, however, suggests that creating a strong feedback loop between the operational integration process and the process of formulating the integration logic and performance goals is difficult, yet is needed to timely revise the initial assumptions in light of changing market realities and responses of key customers to the new corporate strategy. It also suggests that establishing a strong feedback loop between the strategic integration process and the process of formulating the integration logic and performance goals is difficult, yet is needed to maintain sustained top management attention to the multi-year strategic activities necessary to meet the dynamic competitive challenges. Our analysis, furthermore, suggests that top management should be cautious at the outset in stating long-term goals for the new company, not declare victory too soon, and reduce the opportunity costs of acquisition integration by augmenting its own bandwidth for managing large-scale strategic change.

Strategic Consequences of Co-evolutionary Lock-in: Insights from a Longitudinal Process Study

Based on longitudinal research of Intels strategic evolution and grounded theorizing efforts, I examine the strategic consequences of the substantive concept of coevolutionary lock-in in light of a model of organizational strategy-making that distinguishes between induced and autonomous processes. I also examine the implications of the strategic consequences of coevolutionary lock-in for strategic leadership. For purposes of theory building, the organizational-level substantive phenomenon of coevolutionary lock-in can be related to more general, higher-system-level ideas about path dependency, and thereby complements these more general ideas in potentially fruitful ways.

Die digitale Transformation von Axel Springer

Das Internet und die daraus entstandenen Technologien haben seit Mitte der 1990er Jahre weltweit einen tief greifenden Veranderungsprozess ausgelost. Dieser Prozess hat nicht nur Auswirkungen auf das private und gesellschaftliche Leben, sondern auch auf eine Vielzahl von Wirtschaftsbereichen. In der Verlagsbranche verlauft die Digitalisierung mit besonderer Radikalitat und Geschwindigkeit. Das Verlagshaus Axel Springer wurde als einer der fuhrenden Anbieter von journalistischen (Print-) Produkten im deutschsprachigen Raum fruhzeitig von diesen Umwalzungen beruhrt. Das Unternehmen stellte sich den angestosenen Veranderungen unter einer neuen Fuhrung jedoch offensiv. Mathias Dopfner sicherte die zukunftige wirtschaftliche Entwicklung mit der Erschliesung neuer digitaler Angebote, ohne dabei mit der Tradition Axel Springers als Verlagshaus zu brechen. Im Jahr 2015 betrug der Anteil der digitalen Aktivitaten am Gesamtumsatz mehr als 60 % und am EBITDA knapp 70 %. Der vorliegende Beitrag setzt sich – nach einem Uberblick uber die Ursprunge und Aufbaujahre von Axel Springer – mit dem Transformationsprozess, den das Unternehmen seit mehr als zehn Jahren durchlauft, auseinander. Strategische Meilensteine und organisatorische Veranderungsprozesse werden dabei gleichermasen beleuchtet. Der Beitrag von Burgelman und Muffelmann basiert auf einer aktualisierten Fallstudie der Stanford University („Axel Springer in 2014: Strategic Leadership of the Digital Media Transformation“). Dieser Beitrag entstand im Marz 2016.

Strategic Dynamics: Three Key Themes

We study the evolution of industries in terms of three interrelated key themes that together form an analytical lens. The first theme--strategy and strategic dynamics--raises the question of how companies can gain, sustain, or regain profitable growth in the face of various types of strategic dynamics. The second theme--strategy and action--is based on the observation that in rapidly changing environments it is quite difficult to maintain alignment between stated strategy and strategic action and examines how companies can regain such alignment. The third theme--industry change and corporate transformation--recognizes that industry-level change inevitably requires a company to fundamentally rethink its strategy and business model. It must transform itself in terms of what it does and, even more fundamentally, how it does it.

Prigogine's Theory of the Dynamics of Far-from-Equilibrium Systems Informs the Role of Strategy-Making in Organizational Evolution

This paper offers a perspective on how Ilya Prigogines theoretical ideas rooted in the physical sciences can inform and inspire organization theory and strategic management scholars. To that end, the next section of this paper provides a brief synopsis of some of Prigogine and his collaborators seminal scientific insights in the dynamics of far-from-equilibrium systems in the physical sciences. This is followed by a brief summary of how their insights gleaned from studying the dynamics of far-from-equilibrium systems in the physical sciences may inform the study of social systems. The section following this provides examples of the general applicability of the theory of nonlinear dynamics of far-from-equilibrium systems in economics and organization theory. While Prigogines theoretical insights have important implications for all levels of social systems, the main purpose of this paper is to examine how his insights inform the role of the strategy-making process in matching the internal and external ecological dynamics that together determine an individual organizations evolution and its longevity. Consequently, in the next to last section of the paper I draw on my own work about the role of strategy-making in organizational evolution to establish conceptual links with the fundamental insights generated by Prigogine and his collaborators. The conclusion section suggests the potential of Prigogines work to unify the physical and social sciences and to motivate a new philosophy of science.

The Performative Power of Words: How Business Model Innovators Use Framing for Strategic Advantage

Despite increasing interest in business model innovation, there is only limited scholarship that examines how business model innovators present and explain their innovations to various stakeholders. As business model innovation often involves the creation of a new ecosystem, understanding how innovators can gain support of future ecosystem members is important. Based on a longitudinal case study of Salesforce, a pioneer in cloud computing, we show how the innovator’s skillful framing to different audiences fosters the emergence of an ecosystem around the new business model. Our findings suggest that effective framing constitutes an important strategic process that enables business model innovators to shape new ecosystems due to the performative power of words.