Strategic Management of Research Organizations

William Barletta

• Publisher: CRC Press
• Year: 2019
• eBook ISBN: 9781000627381
• Edition: 1
• Topic: Business
• Subtopic: Human Resource Management
• Index: Business

This entry-level text describes a tested top-down enterprise-wide approach to managing organizations with a predominant portion of their product being scientific or technological research. It focuses on executive performance and strategic forecasting and planning; goal-setting; communications and marketing, and operations management to realize strategic objectives. This book will be of interest to entrepreneurs, established scientists and engineers and to those studying toward an MBA with specialization in research institutions and major research infrastructures, preparing them to move from research or academia into their first managerial position. It also provides valuable advice and guidance for established middle and senior management in established research enterprises.

Features:

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• Provides an accessible and easy to follow introduction to strategic management methodologies

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• Explores best practices for communication, marketing, and risk management

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• Discusses workforce management as related to realizing strategic goals and plans

Perspectives and Networks

1

THE ENTERPRISE PLANNING PERSPECTIVE

Vision statements and mission statements have become virtually ubiquitous in the corporate world. That practice has spread beyond commercial firms to research organizations from as small as single technology start-ups to large national and international government-funded laboratories. Nonetheless, beyond their value as feel good slogans, these obbligato texts frequently offer little actionable guidance to top and senior management. Moreover, for the rank and file worker, these statements—if they are even known—convey little meaning or sense of purpose to most employees. Why is that?

From the top-down perspective, these foundational statements are frequently developed post-hoc in response to pressures from shareholders, boards of directors, advisory committees, or government agencies. Although the post-hoc introspection may have some value to the management team, once the relevant pressure group has been satisfied, these statements recede into the background and may be easily forgotten. Yet they should reveal the starting point for managing strategically, as they are meant to describe “who we are” as an organization. This book starts with that perspective. Strategic management should be enterprise-wide with guiding principles and individual managers aligned with and driven by the mission and goals of the organization as a whole. That perspective embodies a superstructure of three tiers:

1. Who We Are (Mission, Vision, and Guiding Principles)
2. Our Goals, Strategy, and Plans
3. Our Understanding of the Market (Business) Environment.

For the research organizations, the market environment includes the research environment, broadly defined funding opportunities, and the potential for spinoffs (or commercialization).

The enterprise-wide approach merges smoothly into holistic management that integrates critical strategic activities and elements of business operations into a logical whole. Within the holistic perspective, the activities that embody the execution of the corporate strategy into management of operations (tactics) and that provide assurance and accountability to stakeholders both flow top-down in a logical way from the enterprise-wide superstructure. The enterprise planning network depicts the flow of logical connections from the space of executive authority to the space of operations management as shown schematically in Figure 1.1.

The execution (operations of the organization) can be considered to be ethical when “doing what is right” is also doing what is best for the organization in the long run.

FIGURE 1.1The flow of planning from strategy to tactics and from executive leadership to operations management.

In the Executive Space of Figure 1.1, the “business environment” encompasses the general research environment, the market structure, competitive and complementary organizations and forces, and the network of stakeholders relevant to the enterprise. The “policy environment” is especially important to those enterprises that receive more than a de minimis portion of their income (or support) from governmental or philanthropic sources. The policies, decisions, and subsequent actions of those sources strongly influence the financial viability of the enterprise in proportion to the fraction of its income from those sources. Naturally, the policies of disparate sources are frequently not aligned. Therefore, senior management must understand and navigate misalignments and conflicts. The top-level embodiment of that navigational process is the near- to intermediate-term business plan and its accompanying financial plan.

Finally, top and senior management must communicate its plans internally throughout the enterprise and also externally to its most important stakeholders and customers. Those later actions imply that the comprehensive scheme of Figure 1.1 omits a second network critical to the success of the enterprise. The product-centric network focuses the enterprise identity (the Why) and its resources (the How) plus the inputs of the customers and the investors onto the products of the enterprise (the What). For a research enterprise, the research output and its outward expression are an important, and often the primary, product line. The top and senior management must never lose sight of the products of its organization. Those products are the sum of the deliverables of the enterprise.

Topics for class discussion or reader introspection: (1) What other relevant networks are there? (2) Where and how does research fit in? (3) How does the enterprise decide what research to perform?

In the Management Space, the combined efforts of the enterprise managers must put the plans formulated and promulgated by the executives into action by the entire set of employees. To assure a cost-effective deployment of corporate resources, the managers of each business unit within the enterprise need an actionable plan with a near-term (3-year) time horizon. Such a plan should derive from an audit of available employee skills and result in a staffing plan for managers to assign (or hire) appropriate employees to take on specific responsibilities and to assure that their performance fulfills the objectives of the enterprise. These human resource plans need to recognize the availability of special skills in the labor market. They must be consistent with relevant labor law and representative contracts for unionized workers. To be legal and ethical, all operations must comply with regulations promulgated by all relevant levels of government. They should respect the environment and the health and safety of the public.

No employee should lose sight that the quality of the organization’s products determines the long-term viability of the enterprise. In the end, assuring the quality of product as well the legal and cost-effective execution of the high-level plans of the enterprise is accomplished via multiple feedback loops of information to the appropriate senior executives. The organization can operate effectively to advance the enterprise strategy crafted by top and senior management when day-to-day operations are structured in a way that flows from and is consistent with the mission, vision, and guiding values of the enterprise.

The overall assessment of enterprise performance for which the chief executive officer is ultimately responsible is a bottom-up evaluation of performance assurance that holds each employee accountable for actions within his/her sphere of influence. Assurance reports are often the product of internal and/or external auditors in which overall performance is judged against the degree to which the enterprise is functioning cost-effectively to advance its mission in compliance with policy, regulations, and relevant law.

To work effectively, managers must feel themselves accountable (and being held accountable) for activities within their respective range of control. Performance-oriented employees can become good managers when they accept personal accountability for their actions, successes, and failures. It is often said that managers fail in direct proportion to their willingness to accept socially acceptable excuses for failure or to blame the levels of management above them with the excuse that “they made me do it.” Likewise mangers must be willing to set and enforce standards of behavior and performance for their subordinates and for themselves. One cannot expect satisfactory assurance audits unless an environment of accountability pervades the enterprise.

If mission and vision statements are the ultimate yardsticks by which the governance body of the enterprise (for example, a Board of Directors) will judge the performance of top management, those statements must be more than anodyne. For major research infrastructures, the mission should offer a concise, compelling statement of why the infrastructure exists. For a technology start-up, the mission statement might contain a compelling description of providing the flagship product of the enterprise to the customer base.

Unfortunately many organizations craft vision statements that are little more than lofty aspirations about the future; i.e., their statements are not actionable. Some vision statements are mere restatements of the mission statement in more esoteric language. For example, one prominent national laboratory proclaims, “Our vision is to solve the mysteries of matter, energy, space, and time for the benefit of all.” A taxpayer may wonder, “Since everything is either matter, energy, space, or time, what in the world is excluded from their vision? For eternity? And to what end?” Such a vision for a publicly funded institution is effectively asking for a blank check to do whatever the Laboratory Director General wants, as it does not provide stakeholders any quantitative—or even qualitative—criteria on which to make judgments and decisions. Vague language does not provide sufficient clarity for serious strategic planning; a collective of secular philosophers or ascetic monks might have the same vision.

To be actionable, a vision statement should state clearly and concisely where the enterprise is going, how it will get there, and what the time horizon for getting there is. For major research infrastructures, a 20-year planning horizon is a reasonable temporal horizon. For a small start-up, a 10-year vision would be appropriate.

Topics for discussion or introspection: (1) What is the mission of your laboratory, company, or university? What is the vision that is broadcast to external stakeholders? Are these statements actionable or are they merely blanket cover for whatever the CEO or lab director wants to do this year?

(2) What are common ways in which leaders mismanage people in research organizations? What kind of damage is done by such mismanagement? Are standards of performance clearly articulated in your organization? Are excuses commonly made for failures in your laboratory, company, or university?

OPERATIONAL NETWORKS

To analyze both internal and external organizational dynamics, a useful starting point is to describe the most important networks that drive the behavior of the enterprise either directly or indirectly. A few definitions and general concepts are in order at the outset. (1) A network is a collection of nodes. (2) A network has connections (links) between nodes. The links may be directional. They may be asymmetric; in order words, a ≥ b does not imply b ≥ a. If the network contains nodes with a single link, it is said to be open. (3) The network has a set of rules that govern the links. In physical systems, these rules could be conservation laws.

1. Networks can describe social relationships such as the management organization, its reporting charts, proximity relationships in social networks, or “communities” and interest groups in which the nodes are actors.
2. Networks can describe physical connections. Examples include cryogenic and electrical circuits and computer networks. In these networks, nodes can be thought of as “solder joints.” In electrical networks, the symmetric links are the linear circuit elements (resistors, capacitors, and inductors). Diodes would be asymmetric links. The network rules are Ohm’s Laws.
3. Networks can describe logical connections. In project management, logic diagrams describe which activities must precede others. Computer flow charts show the logical flow of processing information; in these networks, the nodes are milestones or decision points.
4. Networks can be also tools of analysis, that is, highly idealized models of physical systems in which the nodes are topological.

The opportunity environment for managers and entrepreneurs is their local (social) network. This network is the map of the political landscape of the enterprise managers. The nodes of this network are the set of all potential stakeholders of the organization. In Figure 1.2, the dark solid lines are the direct, bi-directional communications and action links. The general direction of communication flow is (or should be) from bottom upward and from left to right. When employees complain in suggestion boxes and surveys that communications need improvement, they are generally lamenting the fact that the dark black lines are becoming ever more outwardly directed from the center. Unfortunately a common response of senior and top management is to double down on their deficient behavior, for example, by introducing a slick organizational newsletter or merely renaming the old one.

FIGURE 1.2The local (political) network of enterprise mangers.

Management makes a substantial error when it ignores the secondary, indirect links in the network illustrated by the thin bi-directional arrows and dotted lines. These links can “bite” managers in multiple, damaging ways. For public sector organizations in which the consequences of public embarrassment can be severe and unpredictable, one should also include links from the bottom tier elements to the government and the press.

The higher one rises in the hierarchy of corporate management, the more critical that understanding the political network and its potential influences becomes. Although scientists and technical professionals often hear their colleagues proclaim that they hate politics, in failing to understand how to work successfully in their political network, these colleagues are undermining their own chances of success.

Savvy managers know that the network can provide a palpable source of power to those who may have no formal authority at all, even to outsiders. In this context, power means the ability to corral and mobilize resources (human, financial, and infrastructure) to get things done. Ideas alone, no matter how brilliant, change nothing.

The manager’s local network is his/her political system. Key concepts are soc...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Table of Contents
• Foreword
• Acknowledgments
• Author
• 1 Perspectives and Networks
• 2 Measures of the Research Manager
• 3 The Research Environment
• 4 Strategy, Forecasting, and Technological Risk
• 5 Introduction to Strategic Planning
• 6 Financial Management
• 7 The Business Plan
• 8 Management Communication Skills
• 9 Marketing Scientific Organizations
• 10 Research Ethics
• 11 Workforce Management
• 12 Managing Operating Risks
• 13 Structures and Governance
• 14 Technology-Transfer Case Study
• 15 Recommended Resources
• Index