A long-standing staple of the Wharton MBA curriculum, Managing the Established Enterprise is a crash course in decision-making for students hoping to one day lead the Nikes, Apples, and Disneys of the world. Just as getting a business idea off the ground can sometimes feel like keeping plates spinning, managing an incumbent company presents its own set of challenges.
Taught this fall by management professors Natalya Vinokurova, Peter Cappelli, and Leandro Pongeluppe, the course stresses the importance not only of staying competitive in our increasingly complex world, but also of focusing “on the people inside the organization,” says Vinokurova. In that vein, the professors each teach one of three central themes: developing short- and long-term strategies, doing business globally, and managing individuals and teams. Readings from the course (and a podcast for those on the go) offer food for thought for both the rising and seasoned business leader.
Teaching the course’s strategy section, Vinokurova introduces the concept of “co-opetition” to alter students’ concepts of what it takes to be successful in a given industry: “Oftentimes, conventional business strategy loses sight of the collaborative aspects of competition, focusing on zero-sum games where one player’s loss is another player’s gain.” Co-opetition authors Adam Brandenburger and Barry Nalebuff turn that notion on its head, illustrating how firms can “both cooperate to create value and compete to capture value,” says Vinokurova.
“Thinking Outside the Box”
An example of an established company defending against new competition, this 2016 Economist article explores the many strategies Walmart has put into action in the face of heavy-hitting e-commerce disrupters. Although much has played out in the years since the piece’s publication, the takeaways remain the same: the need for fresh thinking amid fundamental change and investment in better conditions for employees.
“On the Folly of Rewarding A, While Hoping for B”
“Incentives matter a lot, but it is easy to get them wrong, in which case really bad things happen,” says Cappelli, who teaches the course’s section on people management. This classic academic paper highlights the many ways incentives can backfire not only when it comes to motivating employees, but also in areas as diverse as medicine, sports, and politics. Being able to identify when incentives aren’t working — and adjusting them accordingly — is imperative for any leader looking to align a workforce with company goals.
“Your Approach to Hiring Is All Wrong”
With increased reliance on outsourced services and automated processes, today’s standards for hiring may not be all they’re cracked up to be. “Businesses have never done as much hiring as they do today. They’ve never spent as much money doing it. And they’ve never done a worse job of it,” writes Cappelli in the opening lines of this Harvard Business Review piece. Part of the problem, he suggests, is that companies rely too much on hiring from outside and not enough on fostering talent from within. Another pain point: how little employers know about which hiring methods produce the best results. Cappelli offers solutions to the modern woes of recruitment, including tips for balancing tech-based approaches with more traditional ones.
“Why the World Isn’t Flat”
Just how interconnected are the roughly eight billion people living on Earth these days? From a business perspective, not as much as you may think. “Despite undeniable advances in globalization, countries still have remarkable cultural, political, institutional, and economic differences,” says Pongeluppe. Teaching the course’s global-strategy section, he draws on this Foreign Policy piece to stress that operating internationally requires a nuanced approach and, similarly, that successful strategies in one country may not ultimately work in another.
“Is the U.S. Really Less Corrupt Than China — and How About Russia?”
Corruption comes in many forms, from bribery and embezzlement to wealth differences that result in systemic inequalities among a nation’s people. This Freakonomics Radio podcast explores which forms of corruption are most prominent in leading nations and how those forms affect economic development. Among the many factors international managers must account for when making decisions, Pongeluppe says, it’s key for them to “comprehend these differences and identify corruption risks to succeed in their endeavors abroad.”
Published as “Legacy Leadership” in the Fall/Winter 2022 issue of Wharton Magazine.