Abstract
This in-depth chapter describes management principles and practices found across six Silicon Valley-based companies that have remained innovative and adaptive as they grew large. All points are illustrated with quotations and examples from the companies, and the key features they share are analyzed as making up the “Silicon Valley Model” for management in fast-changing, unpredictable environments. E.g., the companies have visionary leaders who lay out expansive, ambitious missions for the firms. They recruit people who have entrepreneurial qualities as well as strong technical skills, and their corporate cultures emphasize innovation, flexibility, speed, openness, transparency, and ecosystem awareness. Organizational structures are non-bureaucratic and ambidextrous, and coordination is achieved largely through “soft” control and measuring performance against key quarterly priorities.
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Notes
- 1.
In a 1996 article titled “Firm organization, industrial structure and technological innovation” (Teece 1996), professor David Teece identified four archetypical firms by scope, structure and integration. One of these was labeled the “Silicon Valley Model” and was characterized by having a flatter structure, a more change-oriented culture, and being more specialized and less integrated.
- 2.
Steiber and Alänge (2016).
- 3.
De Jesus (2016).
- 4.
Atzberger (2015).
- 5.
See for example the 2017 U.S. News & World Report rankings of best executive MBA programs at https://www.usnews.com/best-graduate-schools/top-business-schools/executive-rankings. Accessed 22 July 2017.
- 6.
Linden and Teece (2014).
- 7.
Netflix (2009).
- 8.
Drucker (1985), pp. 27–8.
- 9.
Burns and Miller (2014).
- 10.
Ibid.
- 11.
Schmidt and Rosenberg (2014), p. 100.
- 12.
Netflix (2009).
- 13.
Bahrami (1992).
- 14.
IBM Institute for Business Value (2015).
- 15.
Florida (2002), pp. 88–93.
- 16.
Amabile and Kramer (2011).
- 17.
Saxenian (1990). The company cofounder quoted here was Robert Walker of LSI Corporation.
- 18.
DuBois (2012).
- 19.
Schein and Schein (1997), p. 6.
- 20.
Page and Brin (2004).
- 21.
Hardy (2011).
- 22.
Hamel (2009).
- 23.
Netflix (2009).
- 24.
Musk (2014).
- 25.
Brown and Eisenhardt (1998).
- 26.
Battelle (2005).
- 27.
Fehrenbacher (2017).
- 28.
Trefis Team (2016).
- 29.
Saxenian (1990).
- 30.
Sull and Eisenhardt (2015), p. 227.
- 31.
Schmidt and Rosenberg (2014), p. 178.
- 32.
In Henry Mintzberg´s terminology this more traditional model is called the Machine Bureaucracy (Mintzberg 1980). It can be found in many large corporations around the world and typically represents mature businesses with a manufacturing component, which have operated in relatively stable environments. This model is based on management innovations developed in the early 1900s and was used with success by Henry Ford and others.
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Steiber, A. (2018). Management Characteristics of Top Innovators in Silicon Valley. In: Management in the Digital Age. SpringerBriefs in Business. Springer, Cham. https://doi.org/10.1007/978-3-319-67489-6_4
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