MIT Sloan Management Review

Why do established corporations' new ventures often fail? The new issue of Business Insight, MIT Sloan Management Review's collaboration with The Wall Street Journal, includes an interview with Rita Gunther McGrath about problems traditional business planning processes encounter when dealing with uncertain new ventures.

Where do you find inspiration? From great management thinkers like Peter Drucker? Political or military leaders? Great artists or musicians? Or, maybe, a gaudy wedding chapel on the strip in Las Vegas?

That last one probably doesn't rank high on your list. But maybe it should.

When venture capitalists are more tolerant of failure, the successful companies in their portfolio tend to be more innovative.

Many companies have trouble making the transition from a failing business model to one that works. Often, one culprit is an inability to experiment.

Friday we offered selected pearls from a great conversation between banking honcho Larry Fish and MIT Sloan economist (and leading financial crisis commentator) Simon Johnson.

Now we can share full sound and video.

Two of us at MIT Sloan Management Review grabbed good seats at yesterday’s MIT Sloan campus-event headliner: a downwind reflection on fallout from the financial crisis. Featured attraction: a high-level round of bank bashing, with a high-level banker on hand to help do it.

A new working paper tackles an interesting topic: the relationship between tolerance for failure and innovation. In particular, authors Xuan Tian and Tracy Y. Wang looked at venture capitalists' tolerance for failure  -- and its effect on the innovativeness of the young companies they invested in.

According to public filings, about 96% of the boards of Standard & Poor’s 500 (S&P 500) companies had a lead or presiding director in 2008. That was not always the case; in fact, that percentage represents a four-fold increase since 2003.

A new study explores the relationship between venture capitalists’ location and their investments — and finds some quite intriguing results.

Innovation strategy expert Vijay Govindarajan thinks that businesses should be careful not to abandon innovation in their quest for efficiency and cost control during a recession — but they may need to reduce their focus on risky breakthrough innovation plans.

Should established companies even try to launch new ventures regularly? Two management researchers discussed that question recently.

BusinessWeek this week highlights a number of companies that are pursuing growth despite the recession --including Inditex (owner of clothing retailer Zara), Procter & Gamble, and small entrepreneurial businesses such as JustAnswer.�

Are the dynamics of innovation shifting in ways that favor larger companies more than entrepreneurial ones?

What should we make of the role of financial innovation in precipitating the financial crisis — and how might problems with risk management that the crisis revealed be addressed?

MIT Sloan School professor Arnoldo C. Hax, a well-known strategy expert, thinks companies need a different approach to thinking about strategy.

C.K. Prahalad thinks we are entering a period where a key challenge is managing volatility and discontinuities.

In a downturn like this one, every company should — in some sense — think of itself as a new business, according to Harvard Business School’s Lynda Applegate.

MIT Sloan School professor Simon Johnson offers an unsettling interpretation of the financial crisis. Also: Federal Reserve Chairman Ben Bernanke spoke about the relationship between financial innovation and consumer protection.

The challenge for managers during a downturn is to find the balance between pursuing too many unprofitable investment opportunities and passing up too many potentially profitable ones.

Recessions are a good time to disengage from businesses and practices that are weak and under pressure—but the volatile environment demands that managers let go of old approaches.