Some authors, and even some popular journals, have noted examples of the radical new organizational forms now emerging. This article illuminates the technological and services bases of these changes — and examines how to manage them successfully. (Its companion article is “Technology in Services: Rethinking Strategic Focus” by J. B. Quinn, T.L. Doorley and P.C. Paquette; Sloan Management Review 31, no. 2 : 79-87.) Both articles build on the authors’ earlier works published by Sloan Management Review, Scientific American, and the National Academy Press.
1. M. Porter, “Generic Competitive Strategies,” in Competitive Advantage (New York: The Free Press, 1985).
2. T. Levitt, “Industrialization of Service,” Harvard Business Review, September–October 1976, pp. 63–74.
3. For example, McKesson’s ECONOMOST system was planned from the beginning to collect such detailed information concerning item description, price, price changes, shelf location, sales rates, facings information, etc., that the system could later be easily adapted for follow-on services like optimizing floor layouts, stock locations, reordering patterns, bill payments, accounting, credit, and insurance arrangements, market testing, and so on. American Airlines’ SABRE system was set up to capture passenger and flight information in such detail that it could later offer price discounting, frequent flyer, route planning, special food, handicapped person, direct mail retailing, hotel and car reservation, and other services more quickly and in a more targeted fashion than any of its competitors.
4. J. Carlzon, Moments of Truth (New York: Ballinger, 1987).
5. R. Eccles and D. Crane, “Managing through Networks in Investment Banking,” California Management Review, Fall 1987, pp. 176–195.
6. J.B. Quinn, “Managing Strategies Incrementally,” Omega 10 (Fall 1982): 613–627.
7. M. Barrier, “Walton’s Mountain,” Nation’s Business, April 1988, pp. 18–26.
8. B. Posner and B. Burlingham, “The Hottest Entrepreneur in America,” Inc., January 1988, pp. 44–58.
We are most grateful for our respondents’ cooperation and for the generous support of the Bell and Howell, Bell Atlanticom, Bankers Trust, Royal Bank of Canada, Braxton Associates, and American Express companies, which helped finance this project.