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Organization, Planning, and Decision Making Strategy and Innovation to Describe What It Takes to ■ Keystone Strategy LLC ( (continued from front fl ap) SINOFSKY $39.95 USA /$47.95 CAN IANSITI functions, building on his original research in the development of innovative products. Revealing insights into successfully making the leap from strategy to execution Learn from the concepts, capabilities, processes, and behaviors that aligned around one strategy One Strategy examines the concepts, capabilities, processes, and behaviors with the hard-won, fi rst-person insight found in that are essential to aligning an organization around one strategy. One Strategy. Learn some of the key management tools and processes the Windows 7 team put in place to manage strategy and execution. The themes in One his book challenges traditional views of strat- STEVEN SINOFSKY is President of the Win- Strategy are backed up through examples of internal blogs by Microsoft Tegy and operational execution—views that say dows and Windows Live Division at Microsoft Cor- Division President Steven Sinofsky and merged with insightful context strategy comes from a small group of select people poration. Prior to this position, he worked on the from technology and operations strategy expert Marco Iansiti, the David or that an innovative strategy can only emerge development of Microsoft Offi ce from 1994–2006 Sarnoff Professor of Business Administration at Harvard Business School. from a distinct organizational spinoff. Aligning a and, prior to that, worked on Microsoft’s develop- complex organization around one strategy requires All about developing and executing great, innovative strategies, One Strat- all members of a team to participate—learning, ment tools. egy reveals it is possible to build the right organizational capabilities and sharing, communicating, and contributing to the base of understanding, generate insightful strategies, develop detailed team’s success. One Strategy provides a unique MARCO IANSITI plans, and lead your corporate strategies to completion. is the Director of Research and combination of real-world experience managing a David Sarnoff Professor of Business Administration One Strategy shares hard-won insights, experiences, and lessons on: large-scale organization with academic research in at Harvard Business School and the Chairman of Organization, Planning, and Decision Making strategy and innovation to describe what it takes to ■ Keystone Strategy LLC (www.keystonestrategy.com). Aligning a highly complex organization during uncertain times align an organization around one strategy, manage He is an expert on strategy and the management ■ Developing a framework for strategic integrity driven by its execution, and reach for “strategic integrity.” of innovation. His latest research studies strategy planning, organization, and decision making One Strategy describes how to drive innovation by and innovation in networks of organizations, exam- ■ Translating strategic potential into impact connecting the potential of strategic opportunities ining the strategy, operations, and innovation pro- to the impact of operational execution. cesses of key organizations, including Microsoft, ■ Building the capability, effectiveness, and trust that coaches, empowers, and inspires an organization IBM, Wal-Mart, and Dell, along with many others. Microsoft executive Steven Sinofsky joins his He is the author or coauthor of two books, Technol- ■ Motivating your organization to strive for strategic integrity twenty years of management experience at Micro- ogy Integration: Making Critical Choices in a Dynamic soft with Harvard Business School professor Marco …each drawing from methods demonstrated in practice. World and The Keystone Advantage: What the New Iansiti’s twenty years of research on strategy and Dynamics of Business Ecosystems Mean for Strategy, innovation to provide you a unique perspective on Innovation, and Sustainability, and has advised a va- strategy development, alignment, and execution. riety of Fortune 500 fi rms. Here, Sinofsky shares his experiences and point of view through an internal blog site that discusses Jacket Design: Derek McNeill some of the management processes put to work while developing Microsoft Windows 7. Through his own words, One Strategy focuses on the team’s mission to develop and maintain a strategic vi- sion through the 4,000 person, multi-year proj- ect. Marco Iansiti creates a framework that can be Organization, Planning, and Decision Making used by business leaders across industries and job STEVEN SINOFSKY Microsoft Corporation | MARCO IANSITI Harvard Business School (continued on back fl ap) ISBN: 978-0-470-56045-7 4-COLOR GLOSSY ffirs.indd :iv 10/19/09 3:10:11 PM ONE strategy Organization, Planning, and Decision Making Steven Sinofsky Marco Iansiti John Wiley & Sons, Inc. ffirs.indd :i 10/19/09 3:10:10 PM Copyright © 2010 by John Wiley & Sons, Inc. All rights reserved. Published by John Wiley & Sons, Inc., Hoboken, New Jersey. Published simultaneously in Canada. The views expressed herein are the personal views of the authors and do not necessarily represent the views of their employers. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, 978-750-8400, fax 978-646-8600, or on the web at www.copyright.com. Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, 201-748-6011, fax 201-748-6008, or online at http://www.wiley.com/go/permissions. Limit of Liability/Disclaimer of Warranty: While the publisher and author have used their best efforts in preparing this book, they make no representations or warranties with respect to the accuracy or completeness of the contents of this book and specifi cally disclaim any implied warranties of merchantability or fi tness for a particular purpose. No warranty may be created or extended by sales representatives or written sales materials. The advice and strategies contained herein may not be suitable for your situation. You should consult with a professional where appropriate. Neither the publisher nor author shall be liable for any loss of profi t or any other commercial damages, including but not limited to special, incidental, consequential, or other damages. For general information on our other products and services, or technical support, please contact our Customer Care Department within the United States at 800-762-2974, outside the United States at 317-572-3993 or fax 317-572-4002. Wiley also publishes its books in a variety of electronic formats. Some content that appears in print may not be available in electronic books. For more information about Wiley products, visit our Web site at http://www.wiley.com. Library of Congress Cataloging-in-Publication Data Sinofsky, Steven, 1965– One strategy : organization, planning, and decision making/Steven Sinofsky, Marco Iansiti. p. cm. – Includes index. ISBN 978-0-470-56045-7 (cloth) 1. Strategic planning. 2. Business enterprises—Technological innovations. I. Iansiti, Marco, 1961- II. Title. HD30.28.S476 2010 658.4'012–dc22 2009035915 Printed in the United States of America 10 9 8 7 6 5 4 3 2 1 ffirs.indd :ii 10/19/09 3:10:10 PM To Melanie and Malena ffirs.indd :iii 10/19/09 3:10:11 PM ffirs.indd :iv 10/19/09 3:10:11 PM Contents List of Blog Posts vii Acknowledgments ix Preface xiii Chapter 1 Strategic Integrity 1 Chapter 2 Strategy: A Participatory Approach 17 Chapter 3 The Foundations of Strategic Integrity 59 Chapter 4 Integrity and Innovation 85 Chapter 5 Planning: Innovation, Risk, and Agility 107 Chapter 6 Organization: Matching Capabilities to Strategy 151 Chapter 7 Organization: What Managers Do 185 Chapter 8 Decision Making and Value Systems 227 Chapter 9 Personal and Organizational Growth 257 Chapter 10 Lessons from Aligning Strategy and Execution 277 Index 301 v ftoc.indd v 10/19/09 3:09:49 PM ftoc.indd vi 10/19/09 3:09:49 PM List of Blog Posts Chapter 2 Strategy: A Participatory Approach 17 Q: When You Look Down the Road, What Do You Think the Organization Will Be Like? 20 12 Months and about 120,000 Words Later . 25 Perspectives on Partnering and the PC Ecosystem 42 Chapter 3 The Foundations of Strategic Integrity 59 An Allegory of Van Gogh and Batteries 61 Engineering Integrity—7 Elements of a High-Integrity Engineering Organization 64 Please, Just One More Ride . Staying Sane during Development 71 “Cutting Is Shipping” 75 Stress or Pressure? 80 Chapter 4 Integrity and Innovation 85 Follow-Up: Innovation and Organization 85 Innovation and Organization 92 Empowerment in WWL (or the Allegory of the Cave) 98 vii ftoc.indd vii 10/19/09 3:09:49 PM viii list of blog posts Chapter 5 Planning: Innovation, Risk, and Agility 107 Q: Innovation and Planning . 112 Agility in the Context of Planning 116 Risk-Taking in the Context of Planning and Agility 122 Next Steps for Planning 129 What, No Dilithium Crystals? Delivering on Scenarios 140 Vision Rollout—What to Expect . 145 Chapter 6 Organization: Matching Capabilities to Strategy 151 Thoughts on Mission, Vision, Planning, Tactics 152 Power of 3 and Working Together 168 5 Ws and H of the Product Cycle 172 From Brainstorming to Plan to Feature—Selling Your Ideas 177 Chapter 7 Organization: What Managers Do 185 What Do Managers Do and How Big Should My Team Be? 186 Ineffective Middle-Management Suck-ups 196 Manager Phenotypes 203 What Makes a Good 1:1 with Your Manager? 210 Where Does All the Time Go? A Week in the Life . 218 How I Spent FY07 — Time Allocation Summary 222 Chapter 8 Decision Making and Value Systems 227 Accountability Jujitsu—Delegation and Empowerment 229 Conversation No. 37 234 Who Put These Lights in the Garage? 240 No Worries, We Have a .
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