B8215-001: Economics of Organizational Strategy
MW - A Term, 12:30PM to 02:00PM
Instructor: Ann BartelDownload Syllabus
View course evaluation
The success of any organization depends not only on having a well-designed product market strategy but also crucially on how that strategy is executed. Successful execution of strategy requires that the firm deal with two fundamental challenges:
(1) The coordination problem, i.e. getting everyone to work together to jointly pursue the goals of the organization, and (2) The incentive or agency problem, i.e. aligning the goals of employees with the goals of the firm. “Organizational strategy” is the set of practices that the firm uses to deal with the coordination problem and the incentive problem. The main premise of the course is that a successful organizational strategy can be a source of sustainable competitive advantage.
The specific topics covered in this course include recruitment and selection, the challenges and opportunities in using individual and team-based incentives to motivate and reward employees, the use of non-monetary incentives, objective and subjective performance evaluation, investments in human capital, executive compensation, job design and organizational structure, and executive span of control.
The course relies heavily on cases and examines a large number of companies in a diverse group of industries, including the not-for-profit sector. We will examine the organizational strategy decisions made by these companies and draw lessons from their experiences that can be applied to other companies.
Connection to the Core
This course builds on the concepts developed in Managerial Economics.