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Advancing Leadership Theory and Practice

by Nitin Nohria Rakesh Khurana

More than a means of getting ahead and gaining power, leadership must be understood as a serious professional and personal responsibility. In this introductory chapter, editors Nitin Nohria, the dean of Harvard Business School, and Rakesh Khurana, a professor of leadership development at HBS, point out that while many university graduate programs in business, law, education, and public policy claim that their mission is to educate leaders who will advance the well-being of society, the reality is that scholarly research on leadership is, at best, at the periphery of these same universities. In fact, the increasing demand for insights about leadership has largely been met by popular writers-consultants, journalists, or "iconic" business leaders. The papers that comprise this book-originally presented at the Harvard Business School Centennial Colloquium, "Leadership: Advancing an Intellectual Discipline"-are a starting point. Nohria and Khurana define five dualities that they believe are at the heart of research on leadership-for example, the duality between the leader's role in producing superior results and the leader's role in creating meaning. The chapter concludes with a brief summary of each of the book's 25 subsequent chapters. This chapter was originally published as Chapter 1 of "Handbook of Leadership Theory and Practice: A Harvard Business School Centennial Colloquium."

AFL-CIO: Office of Investment and Home Depot

by James Weber Rakesh Khurana

Describes the AFL-CIO: Office of Investments activities in their campaign to improve governance at Home Depot by calling attention to Home Depot CEO Robert Nardelli's compensation package and the company's poor performance. The AFL-CIO Office of Investments advocates for improved corporate governance at public companies, focusing on the problems of excessive chief executive compensation, improperly backdated stock options, insufficiently independent corporate board members, poor responsiveness to shareholders concerns, and a lack of transparency in the activities and decisions of boards. The AFL-CIO believes that such problems were indicators of underlying problems in corporate governance that could impact the long-term value of a public company. To advance its cause, the Office targeted Home Depot. In an effort to bring about change at the company, the AFL-CIO and AFSCME corresponded with Home Depot executives, staged public protests, appeared on talk shows, and maintained several Web sites. The trillion-dollar size of the union pension funds gave the Office a platform from which to work. The departure of Home Depot's CEO had been a significant step by Home Depot and the company had made other concessions as well. The AFL-CIO Office of Investment now needed to decide whether to continue to use its limited resources focusing on Home Depot or find a new target to forward their cause.

Al Dunlap at Sunbeam

by Rakesh Khurana Brian J. Hall Carleen Madigan

Al Dunlap was one of the best-known corporate turnaround artists of the 1990s. In 1996, he was hired at Sunbeam to effect a restructuring, but was fired almost two years later when the company's financial performance and stock price began to decline. Many of the controversies that had surrounded him at his previous job, Scott Paper, followed him to Sunbeam: his rejection of the multiple stakeholder view of corporate governance, his aggressive managerial style, his shaky relations with the media, and his high level of pay. The case describes Dunlap's compensation package at Sunbeam and addresses the issue of how U.S. companies compensate "superstar" CEO's.

Board of Directors at the Coca-Cola Co.

by Rakesh Khurana Jay W. Lorsch Sonya Sanchez

Provides a history of the board of directors of the Coca-Cola Co. through 2003. Describes the evolution in the board's membership, practices, and structure and the role it played in the company's governance. Questions are raised about the relationship between the board and top management, especially how the board is carrying out its responsibilities in the 21st century.

The Curse of the Superstar CEO

by Rakesh Khurana

Feature

Executing Change: Seven Key Considerations

by Nitin Nohria Rakesh Khurana

Provides a 7S framework to complement the McKinsey 7S framework. Focuses on some of the critical choices that must be made in implementing change--Strategic Intent, Substance, Scale, Scope, Speed, Sequence, and Style. Overall, the note argues that these choices must be made so that they are coherent and robust.

Executing Change: Three Generic Strategies

by Nitin Nohria Rakesh Khurana

Describes the strengths and weaknesses of three generic strategies for implementing change--programmatic change, discontinuous change, and emergent change.

From Higher Aims to Hired Hands

by Rakesh Khurana

Is management a profession? Should it be? Can it be? This major work of social and intellectual history reveals how such questions have driven business education and shaped American management and society for more than a century. The book is also a call for reform. Rakesh Khurana shows that university-based business schools were founded to train a professional class of managers in the mold of doctors and lawyers but have effectively retreated from that goal, leaving a gaping moral hole at the center of business education and perhaps in management itself. Khurana begins in the late nineteenth century, when members of an emerging managerial elite, seeking social status to match the wealth and power they had accrued, began working with major universities to establish graduate business education programs paralleling those for medicine and law. Constituting business as a profession, however, required codifying the knowledge relevant for practitioners and developing enforceable standards of conduct. Khurana, drawing on a rich set of archival material from business schools, foundations, and academic associations, traces how business educators confronted these challenges with varying strategies during the Progressive era and the Depression, the postwar boom years, and recent decades of freewheeling capitalism. Today, Khurana argues, business schools have largely capitulated in the battle for professionalism and have become merely purveyors of a product, the MBA, with students treated as consumers. Professional and moral ideals that once animated and inspired business schools have been conquered by a perspective that managers are merely agents of shareholders, beholden only to the cause of share profits. According to Khurana, we should not thus be surprised at the rise of corporate malfeasance. The time has come, he concludes, to rejuvenate intellectually and morally the training of our future business leaders.

From Higher Aims to Hired Hands: The Social Transformation of American Business Schools and the Unfulfilled Promise of Management as a Profession

by Rakesh Khurana

"I have been waiting for years for someone to write the definitive institutional history of U. S. management education, and this is it. From the standpoint of most analytic definitions of 'professional,'the term 'professional manager' is enigmatic, even oxymoronic. Rakesh Khurana's thorough, insightful, provocative, and courageous history of business education explains how this term came to make practical and cultural sense to a generation of Americans, and how its logic has been undermined in the past thirty years. "From Higher Aims to Hired Hands" is an exemplary work of institutional analysis, combining first-rate historiography with outstanding social-science scholarship. It will be essential reading for business historians, students of management and organizations, and faculty, administrators, and thoughtful students at America's business schools. "--Paul DiMaggio, Princeton University" "From Higher Aims to Hired Hands" is a tour de force. With profound depth and sweeping scope, Rakesh Khurana analyses the rise and potential fall of a uniquely American institution--one that has influenced management education throughout the world. His book contributes significantly to explaining how managerial capitalism could go awry and how to restore the moral underpinnings that would make management the profession of leadership. In addition to offering fascinating history lessons based on exhaustive research, Khurana adds new twists to institutional theory and points to future directions for educational practice. "--Rosabeth Moss Kanter, Harvard Business School, author of "The Change Masters, Confidence," and "America the Principled: 6 Opportunities for Becoming a Can-Do Nation OnceAgain" "This panoramic portrait of the origins and ramifications of American business education is quite remarkable, rich in detail, powerful in the marshaling of evidence, and provocative in its claims. Khurana writes with confidence, authority, and erudition. "--Walter Powell, Stanford University "This is a wonderful and important book for anyone interested in business education. There is a tendency for those of us involved in business education to think that we understand the dynamics of our industry and that there is little new that we can learn. How wrong such a judgment would be. In providing a sociological understanding of the origins of business education and the professionalization of management, this book prompts deep reflection about the state of management today and offers real insight into the challenges of elevating the standards of this particular profession. "--Joel Podolny, dean of Yale School of Management

Handbook of Leadership Theory and Practice

by Nitin Nohria Rakesh Khurana

Scores of books and articles have been written in the popular press and mainstream marketplace about leadership: who leaders are, what they do, and why they matter. Yet in academia, there is a dearth of rigorous research, journal articles, or doctoral programs focused on leadership as a discipline. Why do top business schools espouse mission statements that promise to "educate the leaders of the future"- yet fail to give leadership its intellectual due?The Handbook of Leadership Theory and Practice seeks to bridge this disconnect. Based on the Harvard Business School Centennial Colloquium "Leadership: Advancing an Intellectual Discipline" and edited by HBS professors Nitin Nohria and Rakesh Khurana, this volume brings together the most important scholars from fields as diverse as psychology, sociology, economics, and history to take stock of what we know about leadership and to set an agenda for future research.More than a means of getting ahead and gaining power, leadership must be understood as a serious professional and personal responsibility. Featuring the thinking of today's most renowned scholars, the Handbook of Leadership Theory and Practice will be a catalyst for elevating leadership to a higher intellectual plane - and help shape the research agenda for the next generation of leadership scholars.

Hewlett-Packard: Culture in Changing Times

by James Weber Rakesh Khurana Michael Beer

HP had been a highly successful and respected company for decades. It was well known for its company culture and management practices--the HP way--which emphasized both profits and people. Changing markets, strong competitors, and the growth of its computer business, however, battered the company in the mid-1990s. To turn things around, HP hired Carly Fiorina, the first outsider to lead the company. Describes Fiorina's strategy and the impact of decisions she made with respect to the acquisition of Compaq and HR policies on HP's venerable culture and performance.

Messier's Reign at Vivendi Universal

by Rakesh Khurana Daniela Beyersdorfer Vincent Dessain

Focuses on a crisis in the board at Vivendi. Highlights the difficulties that arise when dramatic pressure from outside the boardroom affects boardroom dynamics. In this case, there are two events. The first is an unexpectedly large financial loss and a pending cash flow crisis that forces Vivendi's directors to deal with the issue of dismissing their CEO. Whatever they decide, their actions will be scrutinized by the press and investors and will likely be revisited in a legal environment. The second is the board diagnosing its role in the financial crisis by approving a series of costly acquisitions in recent years that led to the crisis.

PepsiCo, Performance with Purpose, Achieving the Right Global Balance

by Rosabeth Moss Kanter Rakesh Khurana Rajiv Lal Eric Baldwin

This case explores a shift in strategic direction at PepsiCo, the second-largest food and beverage company in the world. It concentrates on the formation of a new group, the Global Nutrition Group, whose purpose was to bring focus to the company's efforts to significantly expand its offerings in nutritious food and beverages. The case explores the background to that decision and the complexities the company faced in altering its product portfolio over the long run (which also included efforts to make its core snack and soft drink products healthier), while at the same time maintaining short-term profitability. The evolution of the product portfolio was part of a larger effort to implement a new strategic vision, encapsulated in the phrase, "Performance with Purpose." The phrase, in brief, expressed a commitment to deliver financial results in a way that was good for the world as well as good for the company.

Revisiting the Meaning of Leadership

by Rakesh Khurana Joel M. Podolny Marya Besharov

The authors of this chapter contend that the study of leadership in organizational theory went awry when interest in leadership became too tightly coupled with organizational performance. Leading organizational theorists in the latter part of the twentieth century, such as Max Weber, Chester Barnard, and Philip Selznick, were not concerned with leadership because of its ability to explain financial performance. Instead, they were concerned with leadership's importance in infusing purpose and meaning into the lives of individuals. Although performance was not judged irrelevant by these earlier theorists, neither was it central. For them the primary significance of leadership rested in its importance in stemming the loss of meaning that they and other scholars of their time ascribed to modernity. The authors of this chapter conclude that if we are to judge the importance of leadership to organizational life, we need to break free from the strict interdependence of leadership success and organizational performance-and take a much broader view. This chapter was originally published as Chapter 3 of "Handbook of Leadership Theory and Practice: A Harvard Business School Centennial Colloquium."

Sapient Corp.

by Rakesh Khurana Joel Podolny

Describes the start-up, growth, organizational design, and operations over the first 10 years of a professional services firm. Focuses on the creative use of organizational purpose and values as an integral part of strategy and alignment of organizational activities.

Sapient Corp. (Abridged)

by Rakesh Khurana Joel Podolny

Describes the start-up, growth, organizational design, and operations over the first 10 years of a professional services firm. Focuses on the creative use of organizational purpose and values as an integral part of strategy and alignment of organizational activities.

Searching for a Corporate Savior

by Rakesh Khurana

Corporate CEOs are headline news. Stock prices rise and fall at word of their hiring and firing. Business media debate their merits and defects as if individual leaders determined the health of the economy. Yet we know surprisingly little about how CEOs are selected and dismissed or about their true power. This is the first book to take us into the often secretive world of the CEO selection process. Rakesh Khurana's findings are surprising and disturbing. In recent years, he shows, corporations have increasingly sought CEOs who are above all else charismatic, whose fame and force of personality impress analysts and the business media, but whose experience and abilities are not necessarily right for companies' specific needs. The labor market for CEOs, Khurana concludes, is far less rational than we might think.Khurana's findings are based on a study of the hiring and firing of CEOs at over 850 of America's largest companies and on extensive interviews with CEOs, corporate board members, and consultants at executive search firms. Written with exceptional clarity and verve, the book explains the basic mechanics of the selection process and how hiring priorities have changed with the rise of shareholder activism. Khurana argues that the market for CEOs, which we often assume runs on cool calculation and the impersonal forces of supply and demand, is culturally determined and too frequently inefficient. Its emphasis on charisma artificially limits the number of candidates considered, giving them extraordinary leverage to demand high salaries and power. It also raises expectations and increases the chance that a CEO will be fired for failing to meet shareholders' hopes. The result is corporate instability and too little attention to long-term strategy.The book is a major contribution to our understanding of corporate culture and the nature of markets and leadership in general.

Tyco International: Corporate Governance

by Rakesh Khurana

Examines how Tyco and its board recovered from its corporate scandals. Describes how its CEO and board set out to institute processes, guidelines, and a culture that would make Tyco into a company widely recognized for its world class corporate governance.

Veridian: Putting a Value on Values

by Rakesh Khurana Joel Podolny Jaan Elias

David Langstaff, the CEO of Veridian, a defense company, struggles with the decision of selling the company. Langstaff has concerned himself with inculcalating his organization with the values necessary for superior achievement over the long term. But as a fiduciary, he had to come up with a single value to monetize the reputation the company had built. Langstaff wondered what was best for the firm and its customers and what his other options were. He also was concerned with how the prospect of selling the firm would square with Veridian's commitment to its constituencies and values-based leadership.

The World Economic Forum's Global Leadership Fellows Program

by Rakesh Khurana Eric Baldwin

This case examines a distinctive leadership development program within the World Economic Forum. The program, born out of the conviction that the complexity of global challenges at the beginning of the 21st century required a new generation of global leaders, recruited a small number of "high potential" young leaders from around the world as "Global Leadership Fellows" each year. During the three-year program, Fellows combined a position at the Forum with formal classroom training modules, one-on-one coaching, peer mentoring, and extensive assessment. The case explores the Forum's understanding of its role in the world, the vision of leadership that animates the program, and the structure and content of the program. It asks how successful the program has been in providing the kind of transformational experience it envisions and whether it could or should be replicated by other organizations.

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