Professional Documents
Culture Documents
Modern Competitive Strategy 4th Edition Walker Solutions Manual 1
Modern Competitive Strategy 4th Edition Walker Solutions Manual 1
Learning Objectives
LO 05-01. Identify and describe the basic elements of strategy execution.
LO 05-02. Explain the relationships between resources and capabilities.
LO 05-03. Apply the Value Chain and Activity System frameworks.
LO 05-04. Summarize the organizational dimensions of capability development and explain how
they are guided by and determine a firm’s Value minus Cost position.
LO 05-05. Identify the advantages and disadvantages of different types of organizational
structures and how they affect capability development.
LO 05-06. Explain the roles of culture and learning in strategy execution.
1. Overview
This content is essential. It teaches how the firm develops and maintains the resources and
capabilities that determine its value and cost drivers. Students need to understand the
We start with discussing what strategy execution is and what it is not. For instance, strategy
execution is not about strategy development, strategic planning or luck. Strategic planning (see
Ch. 6) articulates a firm’s strategy and the programs to implement it whereas strategy
execution is the day-to-day substance of strategy; it involves developing and maintaining a
firm’s resources and capabilities to support Value, Cost or both.
Since planning is clearly a critical strategic task in many firms and brings together the points
made throughout the book, the subsequent chapter (Ch. 6) presents standard planning tools
and shows how the principles of execution discussed in Ch. 5 are necessary content for an
effective plan. We often assign the planning chapter with the chapter on Execution when
teaching cases on turnaround (e.g., Siemens Medical Solutions).
We begin the execution session by revisiting the differences between resources and
capabilities, highlighting their definitions and characteristics, and arguing that they are
developed and protected differently. Makadok’s model is especially valuable here (see the
sidebar), since his analysis shows how complementary resources, forecasting capabilities and
the link between capabilities and resources have an effect on profitability. Students, who have
typically had a core course or more in finance when they take strategy, can appreciate how
Makadok sets up his arguments and reaches his outcomes.
Next, we use the value chain and activity system concepts to help students gain a stronger
understanding of the differences between resources and capabilities. In our courses, the value
chain concept is used in multiple ways: specifically to show how firms compete differently in
the same industry and how business units within a multi-business firm can share resources and
capabilities. So introducing the framework here is very useful. Activity systems are a more
recent construal of how firms are organized. Siggelkow’s picture of Vanguard’s system is useful
because: 1) it is focused on achieving low costs while providing a targeted kind of value to
customers, and 2) it has a high degree of integration which leads to a later discussion of
consistency and fit. At this point, it is again important to emphasize the link between tasks and
activities and achieving and defending the firm’s market position. Figure 5.3 helps to show how
this bridge is conceived. This figure also makes clear that both resource complementarity (as in
Makadok’s model) and improvement in capabilities through innovation in activities are integral
parts of the strategy execution framework. The resource portfolio of the firm can be modified
as opportunities arise, increasing complementarities and therefore the potential for higher
value or lower cost. Correspondingly, as the firm invests in new processes, capabilities are
enhanced.
At this point, the focus on resources becomes secondary to capabilities. The question arises,
how are capabilities built? How can we understand their development? The four organizational
The discussion of consistency/fit can begin by returning to the Vanguard diagram. There are
almost no links between elements that do not support the firm’s market position. Importantly,
this process could not be effective without John Bogle’s target market position. So, consistent
activity systems contribute to performance only when they lead to higher value at lower cost.
Bogle’s vision emphasized cost reduction.
Moving to control and coordination systems leads to a discussion of the classic forms of
organizing - here restricted to a single business, so the product structure is missing. We employ
Galbraith’s original framework since it synthesizes earlier work and motivates subsequent work.
The chapter repeats and expands Galbraith’s arguments for the advantages and disadvantages
of each organizational form; the slide deck highlights the classic tension between knowledge
specialization and knowledge integration. It is useful to tie these arguments again to the
capabilities that underlie value and cost drivers. An easy example concerns the development of
capabilities in technology development, assuming that technology is an important value driver:
a firm with a functional structure containing centralized R & D would clearly have an advantage
here, given benefits to aggregation in this activity.
The next organizational dimension is incentives. The Hall framework is very useful here. His
approach differentiates three types of problem - controllability, alignment and
interdependence – and relates them to two dilemmas – noise and distortion. There is no
perfect system since noise and distortion are substitutes in the sense that any incentive system
makes a tradeoff between them. The piece rate system at Lincoln Electric has developed over
time to overcome this difficulty. However, the rigidity of the solution has caused problems for
the company – a point that we like to make, linking back to the concept of core rigidity in the
Chapter Four. For instructors interested in using very brief video clips in class, a two minute clip
from the “I love Lucy” show where Lucy and Ethel work on a candy factory line might be used to
introduce or illustrate the piece rate concept (see the Video resources section of this
document).
The last organizational dimension is people and culture. The literature on culture is large but its
tie to strategy is weak. Therefore we like to use Kreps’s argument, building on Schelling, that
culture induces common focal points for decision-making. To make the link to strategy
execution, these focal points should be aligned with improving capabilities that in turn improve
the firm’s market position. Most adherents of the value of culture, for example as it has been
applied at Southwest Airlines, tend to make arguments like this. As for people, we emphasize
The chapter includes a callout on the role of social networks in strategy execution. This content
presents an opportunity for illustrating how social forces affect an organization’s culture and
coordination systems.
Last, we use Figure 5.5, Capability Planning and Learning to illustrate how the elements of
strategy execution focused on capabilities are brought together. We find this snapshot provides
a strong, synthetic visual tool for students who want to take away a clear picture of how
planning and execution lead to an improved market position.
We wrap up the session with questions for practice (final .ppt slide).
2. Case Recommendations (all materials available via HBS Online for Educators)
For additional cases, see the Case Chart that maps chapters and topics to cases and simulations.
3. Teaching Tips
Rather than lecture, we use a case-based approach and draw out the lessons of the chapter as
we move through the case discussion. Again, the intent is to have the students put their
knowledge into action -- applying concepts from the chapter to the case. We devote a session
specifically to Strategy Execution however many of the concepts may be reinforced in other
sessions in a core strategy course or multi-session module on strategy. For instance, the
concepts associated with culture and learning may be revisited in the context of acquisition
integration or alliance management; concepts related to organizational structure and
Exercises
B) 7-10 minute application exercise: Ask the students to work in pairs on a brief assignment.
The intent is to get them thinking about how to apply a particular concept as a set up for class
discussion. For example, using the case assigned for the session, ask half of the two person
teams to create value chain diagrams and ask the remaining teams to create activity system
diagrams. Discuss the differences between the two frameworks.
Videos
B) Complementarity
“Strategic Complementarities at Steak”, a brief summary and copy of the video are available at
the Carpenter Strategy Toolbox website (category “Humor”), scroll to the bottom of the page:
http://carpenterstrategytoolbox.com/category/humor/
[Contents]
P N . 90
CORNERED
By T. J. S
Look at those corners, full, compact, ample, obese. A little bit loose
on the sides, but admirable for corner construction. Most constructors
would run the arms of the central cross out to the next to last letter.
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17
18 19 20
21 22 23 24 25
26 27 28 29 30 31
32 33 34 35 36
37 38 39 40 41 42
43 44 45 46 47
48 49 50 51
52 53 54 55 56 57 58
59 60 61 62 63 64 65 66
67 68 69 70
71 72 73 74 75 76 77
78 79 80 81 82 83
84 85 86 87
88 89 90 91 92 93 94
95 96 97 98 99 100 101
[92]
HORIZONTAL
Interchange
1 of opinions An Indian
69
A set of
7 steps leading over a wall Disagreeable
70
or fence A Roman
71 highway
A true11copy of an original A fruit
73(pl.)
writing Horned
75 toad
Yearly
18 A festival
77
A unit
19 Ruins78
Discordant
20 A color
80
Established
21 To delay
82
Large23body of water Laborer
84
To make
25 a circuit Lift 85
A master
26 Pertaining
87 to ferns (pl.)
A slight
27 sound To percolate
89 slowly
Taste29 Part of
90the harness of a
To abide
31 horse (pl.)
A shrub
32 A Chinese
92 wax
Rent 34 A place
95 of worship
To extract
35 Artificially
97 produced
A device
36 for igniting an Daughter
98 of Uranus
explosive charge A Greek
100 letter
Son of
37Vulcan (Rom. Tidy102
myth) A part
103of a shoe
A doglike
39 animal Feminine
104 proper name
A stream
41 Obsolete,
106 timber
Clearer
42 Catch
107(colloq.)
To eject
43 User108
of tobacco
Pertaining
45 to A vegetable
110 (pl.)
understanding A prefix
112 meaning limit
Immense
47 (geom.)
A child
48 Number
113 of books printed
Jeweled
50 headdress at once
Father
51 A tree
115
Staggered
53 A large
117 seal
Born55 To yield
119
Admire
56 (U. S. colloq.) Nothing
120
Needy59 A fine
121
To burst
61 forth Moved
122 away furtively
Withered
63 (obs.) Cut 123
of meat
Presage
65 Sophoclean
124 hero
To grate
67
Name68of an automobile
VERTICAL
[95]
[Contents]
P N . 91
THAT EXCLUSIVE LINOLEUM PATTERN
By W H. K
Mr. Koch wandered into the kitchen after a doughnut, and saw black
and white squares all over the floor. “Aha,” thought he, “like a flash,
an idea!” This is it.
1 2 3 4 5 6 7 8 9 10
11 12 13 14 15
16 17 18 19 20
21 22 23 24
25 26 27 28
29 30 31 32 33
34 35 36 37 38
39 40 41 42
43 44 45 46 47
48 49 50 51 52
53 54 55 56
57 58 59 60
61 62 63 64 65
66 67 68 69 70
71 72
[94]
HORIZONTAL
Grammatical
1 figure Concerning
41
Interchange
6 Indefinite
43 nominative
A negative
11 vote Petitioner
44 at law
First 12
cause A color
46
A tetrasyllabic
14 foot River48in Germany
The two-toed
16 sloth A second
50 perusal
Fragments
18 Rather52than
Collection
20 of animals The rear
53
To charge
21 with gas Layers
55
Astronomical
23 measuring Coins57minted under
instrument Charles I
Bull’s-eyes
25 at archery Tripod
59
Compounds
27 having the Prefix;
61the same
same composition Scourge
63
Spiteful
29 woman A field
65 of granular snow
Separation
31 of compound A bid66at bridge
words An evening
68 party
Ornamental
33 border Gold70color
To eject
34 legally The goober
71
Displace
36 A cognomen
72
The Roman
38 libra
A kind39of indehiscent
fruit
VERTICAL
Encircle
1 Incarnation
30
Ordinary
2 Turkish
32 hospice
Wend 3 St. Vitus’s
35 dance
Collection
4 of interesting Month 37of the Jewish year
objects Strait40
Geometric
5 figure A grooved
42 wheel
Tolerate
6 A source
43 of synthetic
Rebels7 indigo
Preposition
8 Shakespearean
45 character;
A soluble
9 ferment a duke
River10 Sexless
47
A delicate
11 gradation Scene49of Napoleon’s
Lacrosse
13 racket defeat of the Austrians,
Solicits
15 1796
Frigid17 A blood
51 vessel
Place19of detention Penal54crime
Falter22 Ringworm
56
Aftermaths
24 Inclination
58
Cylindrical
26 Cry of60bacchanals
A click
28 beetle Sip 62
Tomcat
64
Note 67
of diatonic scale
Printer’s
69 measure
[97]
[Contents]
P N . 92
ADAM’S RIB
By E. P
If this puzzle were Adam, that central double armed cross would be
his rib just before it started turning into Eve. We observe nice fat
masses of words at sides and corners.
1 2 3 4 5 6 7 8 9 10 11 12
13 14 15 16
17 18 19
20 21 22 23
24 25
26 27 28 29 30 31 32
33 34 35 36 37
38 39
40 41 42 43
44 45 46
47 48 49 50 51
52 53 54 55 56 57 58
59 60 61 62
63 64 65
66 67 68
[96]
HORIZONTAL
3.2 grains
1 Dregs39
Wicked5 Unfastens
40
Supply8 food Small42egg
Animal
13 without feet Handles
43
Rectangular
14 piece Move44
Female
16 beast of burden Huge46snake
Father
17 Two-faced
48 outwork
Reduce
18 Hide 52
Series19of heroic events Studio
55
Hermit
20 A game
59
Zealous
22 Choose
60
Constraint
24 Qualified
62
Rested
27 Entrance
63 to a mine
Every29one Bargains
64
Narrow-minded
33 people Furnace
65
Chart35 Keep66back
Vassal
36 Relieved
67
Rage38 Set again
68
VERTICAL
Cloak 1 Part of
31a shoe (pl.)
Aside 2 Dirty32
Cord 3 Knock 34
First man
4 Obtain37
Young5children A father
41
Collection
6 of sayings Sharpen
43
Restrain
7 Scolds45
So be it
9 Posts46for cables on a ship
Narrow10 strip Crystal-lined
47 stone
Appearing
11 gnawed Pert. 49
to the palate
Cease12from motion Lashed50
Eucharist
14 plate Reigning
51 beauty
Depart15 To box52
The rainbow
21 Shear53
Actual23 Repetition
54 to learn
Scrutinize
25 Variety
56 of red
Dress26covering Egyptian
57 bird
Exists27 Hire 58
Actor28 Yale 61
Microscopic
30 hair (pl.)
[99]
[Contents]
P N . 93
IN THE CLOVER PATCH
By M
17 18 19
20 21 22 23 24 25
26 27 28 29 30 31 32 33
34 35 36 37 38 39
40 41 42 43 44
45 46 47 48 49 50 51 52
53 54 55 56 57 58 59 60 61
62 63 64 65 66 67 68
69 70 71 72 73 74 75
76 77 78
79 80 81 82 83 84 85
86 87 88 89 90 91 92
93 94 95 96 97 98 99
[98]
HORIZONTAL
Phrygian1 shepherd Move78
changed into a fir tree Dissipate
79
God of5 love Pert. 81
to the eyes
Parched 9 Federations
83 of workers
Domesticates
12 Hostelries
86
Unusual
17 A lizard
87
Was contiguous
18 Unit 89
Kind19 of compass used in Propeller
90
surveying A pledge
92
Considerable
20 in degree Past 93
Rounded
22 protuberance One who94 compiles
A drop23 of saline fluid material for publication
Domestic
25 animal Placed 96at intervals
Indian26tribe Japanese
99 plant
To inspire
27 deep reverence Implore
100
Bordered
29 Barrier
102
Exist31 Abaft
104
Small33mound of earth Tree105
Goddess
34 of the moon Males
107
Receptacle
37 for ashes Well-being
109
Grecian
38 sub-prefect Wrath
112
Obtain40 Phœnician
114 princess
Make41less bitter carried away by Zeus
Overmuch
44 Bronze
116 or copper
Pore 46
over Tottered
117
One 47 Watering
121 place
Part of
48a circle International
123 language
A small
50 hole Broke
124
Ventilate
53 Tiny126
Groups55 of three Sharp-pointed
127 tool
Trial 58
impression Vedic
129god of the sun
Loose60end Not131good
Web-footed,
62 tailless Persia
133
amphibian Pert.135
to national sea
Minor 64devil forces
Seaman65 Sea 137
eagle
To be67obliged for Brittle,
138 salty biscuit
Certain
68 Languish
139
In the69direction of Irascible
140
Be conscious
141 of
Writer
71of a kind of Those
142snaky fish
plaintive verse A donkey
143
To seek
74 something lofty
Floating
76 vegetation in the
Nile
Vapid77
VERTICAL
Hundred-eyed
1 son of Once66 more
Zeus A small
68 shoot or twig
Acid 2 Regret70
Instruments
3 for Edge72
preserving the form of A high73wave
shoes Wickedness
75
An affirmative
4 The moon
79
Took its
6 way One who
80 meanly admires
Wind instrument
7 wealth or social position
Quiet 8 One of81a tribe of
Heedful9 Algonquin Indians
Long,10slender plant Idler 82
Mountain
11 near ancient Solemn84 affirmation
Troy To shut
85 close
Flurry13 Falsehood
88
Merriment
14 Deed91
Comfort
15 A nymph
94 who was
Smooth16 changed into a fountain
Ancient
21 coin mentioned Metal-bearing
95 rock
in the Bible Equality
97 as to value
Immediate
22 knowledge Make98less light
Tap 24 That101
overworked
The brave
25 Australian bird
Saturated
28 The103
southwest wind
Enlarged
30 The106
papal court
Rodent32 The108
land where the
Essential
35 self sandman lives
Elude36 The110
bay tree
To implant
38 deeply A judicial
111 inquest
Demure39 To chill
112
Marry42 A piece
113 of property
A discriminating
43 sense of Merits
114
hearing An effervescent
115 drink
Imbecile
45 Possess
118
Expression
46 of exaltation A king
119of Israel
Intention
47 A narrow
120 passage
A female
49 quadruped Unadulterated
122
Case 51
for small articles A tiresome
124 person
A kind
52of molding A large
125 plant
Smoothing
54 Staff128
Full of
56perforations Still130
Person
57with a powerful Open 132
voice Total134
Noblemen
58 of high rank Imitate
136
A marked
59 characteristic
To adjust
61
Pants63
[101]
[Contents]
P N . 94
LITTLE BUT A BAD ’UN
By F C. W
Mr. White must be one of those mild-seeming people who fool you so
often—at least that’s the impression his construction gives the editor.
It is little. It looks harmless. But don’t start it if you have an
appointment two hours hence. But maybe we shouldn’t give this
away.
1 2 3 4 5 6 7 8 9
10 11 12
13 14 15 16
17 18 19 20
21 22 23 24
25 26 27 28
29 30
31 32 33 34 35 36
37 38 39 40
41 42 43 44
45 46 47 48
49
50 51
[100]
HORIZONTAL
Original
1 man of Horus An exclamation
30 of
The first
6 Jewish high surprise
priest Leisurely
31 (obs.)
A genus
11 of Am. plants Any sirenian,
34 esp. the
A member
13 of the Creek rytina
Indian tribe A pliable
37 strip of oxhide
Metal15for casting in pigs (So. Africa)
A game17 played for stakes Contrary
38 to good in a moral
A valley
18 in N. W. Argolis sense
Sooner20 than A recess
40 in the shore
Track21of a deer Anything
41 steeped in
One of23a tribe of liquid
Algonquians A wind
42 (musical)
In the24thing or individual instrument
Permit25(3rd per. sing.) A fairy
44 queen
(pl.) A genus
45 of No. Am.
A workman
27 on shoes herbs
Denoting
29 the infinitive A cloud
47
Reprinting
49 and publishing
of a work
Lamellirostral
50 birds
Am. wild
51 plums
VERTICAL
Tutor 2 Son of
24Abraham and
A garden
3 implement Sarah (Bib.)
Monitor4 lizard Sorrow
26
Restores
5 to existence A beverage
28
Invoke6 Burning
31
An Eastern
7 continent Be present
32 (obs. var.)
To clothe
8 in an odd Long33speech
manner Slope34(3rd per. sing.) (pl.)
Mien 9 Common
35 (obs. var.)
A town
10 in Oklahoma A German
36 philosopher
To insinuate
12 contempt Abbr.39Life Guards
Light14repast Compounds
42 containing
Absence
16 of removal metal
(rare) An English
43
Objective
19 case of I mathematician
Natural
22 kind or class, esp. A word
46 of command in
of animals driving animals
Hoot48
[103]
[Contents]
P N . 95
MODERATION
By P R. L
12 13 14
15 16 17 18 19
20 21 22
23 24 25 26 27 28
29 30 31
32 33 34 35 36 37 38
39 40
41 42 43 44
45 46
47 48 49 50 51 52
53 54
55 56 57 58 59 60 61
62 63 64 65
66 67 68
[102]
HORIZONTAL
Snake 1 Country
40 in N. America
Rainy 4 Legendary
41 king
Make 9hum by spinning Legal42science
Russian
12 money Cause44of anything
Steep13 Set again
45
Fat 14 Son of
47Odin
Notable
15 period Something
49 to follow
For instance
16 Secondary
51
Toward
18 A root
53
Mend19 Sound54
Confronted
20 In such
55 circumstances
Lariat22 Atop57
Speck23 You and
59 I
Pasturage
25 Torn 60
piece
Impair
27 Unripe
62
Public
30passages Ventilate
63
Raves32 Product
65 of digestion
Layer35 Slippery
66 fish
Length
36 of the forearm Bearing
67 buds
Member
39 of cat family Influenced
68
VERTICAL
[Contents]
P N . 96
JUST FOR TWO!
By C C and S L
These two contributors send in Cross Words by the dozen, so you can
imagine what splendid vocabularies they must have. This is one of
their best, and it’s not an easy one, either.
1 2 3 4 5 6 7 8 9 10 11 12
13 14 15
16 17 18 19 20 21 22 23
24 25 26 27
28 29 30 31 32 33
34 35 36 37 38 39
40 41 42 43 44
45 46 47 48 49 50 51 52
53 54 55 56 57
58 59 60 61
62 63 64 65 66 67 68
69 70 71 72 73 74
75 76 77 78
79 80 81 82 83 84 85 86 87
88 89 90 91 92
93 94 95 96 97
[104]
HORIZONTAL
Tatter 1 Squeeze
60
Dressed,
3 as a stone Planet61
A color7 Silicate
62 of magnesia
Guided11 Note 63
State13 Battering
65 engine
Danger14 Chinese
67 coin
Murmur15 Voter69
Jutting
16rock Earthwork
71
Weird18 Newness
73
Select20set Invisible
75 fluid
Fortify
22 Dromedary
76
Jejune24 Meadow
78
Stranded
25 Grain79
Single27 Java 82
pepper
Game28at cards Cleanser
84
Cone29 bearing tree Iniquity
86
Scrutinize
30 Bark 88
Cereal32grain Vassal
89
Craft34 Exclude
91
Mercenary
35 Trick92
Mohammedan
37 religion Disturbance
93
Foxy39 Become
94 acclivitous
Winnow40 Protrude
97
Darns41 Roadhouse
98
Racing43 boat Lance99
Rhythm45 Extreme
101
Also 49 Sore104
Six angled
50 figure Bond106
Throw 53 A relative
107
Wander54 Wing-shaped
108
Cad 56 Edible
109tuber
Desire57 Toughen
110
Rake58 Hydrocarbon—radical
111
Plunder
59 At a112
distance
VERTICAL