Innovation and organization design
Mike Tushman

Mike Tushman taught us at AMP 172 at HBS.I particularly enjoyed his analysis of the case titled  Gunfire at Sea which I shall describe later.

One of the difficulties that managers face is precisely this: how do you balance efficiency with flexibility?

The url of the 63 page paper in pdf format  "Innovation streams and ambidextrous organizations" is http://www.london.edu/assets/documents/PDF/Tushman_Smith_et_al_Org_Sci_Dec_2004.pdf

Now the fascinating story of Gunfire at Sea.Innovation happens in the field,seldom at the headquarters!!!!

Until the late 1800’s, naval gunfire was a very inexact ‘art’ blending basic mechanical movements with a gunner’s skill at timing the shot with the ship’s motion.  Admiral Scott would revolutionize the ‘art’ in the Royal Navy (RN).  In the day, guns were mounted in the ship in a relatively fixed manner (although not so limited as the earlier cannons were on the sailing ships).  Gears were used to traverse the gun horizontally onto target and a second set of gears was used to set the required elevation for the target’s estimated range.  The gunner would then time his shot with the rolling of the deck – firing just a split second before the pitching movement brought his iron sights onto target.  As a result, accuracy was somewhat limited and therefore reliance on the guns, and in turn the gunner’s status, was less than pivotal in battle.  One account has five ships of the 1899 North Atlantic Squadron firing in turn for five minutes at a target ship 1600 yards away.  After the 25 minutes only two rounds had found their mark.

Scott, who in 1898 was captain of H.M.S. Scylla, was very much interested in improving his ship’s gunnery.  During one particular training session, he noticed that one gunner had much better results than the others.  After scrutinizing this individual’s actions, he noticed that, unconsciously, the gunner was using the gun’s elevation gears to compensate for the ship’s rolling moment.  Scott immediately grasped the potential of the gunner’s unconscious actions.  He devised a means to modify the ship’s guns with more favourable gear ratios and then trained the crews for ‘continuous-aim gunfire.’  Within a year, the Scylla was establishing new gunfire records; naval gunfire began the transformation from an art to a science!  Scott had been unable to figure out the solution to better accuracy on his own (creativity), but he was able to recognize the possibility of an observed action and to exploit the idea into reality (innovation).  While the Royal Navy immediately began benefiting from Scott’s continuous-aim fire, bringing it into the United States Navy (USN) was more problematic.

Lieutenant Edward Sims, a junior officer aboard the US Battleship Kentucky, met Scott in 1900 and from him “…learned all there was to know about continuous-aim firing.”  After modifying Kentucky’s guns, Sims’ innovative personality next turned to introducing this new technology to the USN.  Official reports with “…extensive data on its [the new gun system] efficiency and accuracy”were submitted to the Bureau of Ordnance in Washington.  Sims’ reports were ignored – how could a lieutenant know more about gunnery than more senior ordnance experts?  Escalating his efforts Sims began to circulate his reports throughout the USN – to anyone who would listen; his efforts were in vain.  The USN actively began to discredit Sims with a campaign of its own.  If accuracy was a problem, the Bureau reasoned, it was certainly not due to inferior technology: “If there was a problem, it was with the gunners and their training, not with the equipment.”  Besides, reasoned the Bureau, the Spanish-American war was won using present gunnery tactics.  Frustrated by the navy’s intransigence, but unwilling to give up, Sims sent a documented report of the case to President Roosevelt, an ex-Secretary of the Navy:

Violating navy practice and usurping the entire hierarchy, he brought Sims to Washington and made him inspector of target practice.  Roosevelt mandated the use of continuous aim gunfire throughout the navy and charged Sims with ensuring that his order was accomplished.

A number of lessons can be drawn from Sims’ efforts.  Although the basic gunnery technology existed and was not changed, it took innovation to successfully exploit one gunner’s creativity.  The ‘warrior’ nature of the expeditionary RN permitted an innovative culture willing to adapt in order to maintain their military advantage.  The same cannot be said about the more isolationist nature of the USN.  Interestingly, USN resistance to change came directly from those who were in the best position to understand the benefits, but were unable to accept innovation from someone outside their area of expertise.  One observer categorized this resistance as being the result of identifying too closely with the individual systems (guns) instead of with the bigger whole (navy) and the obvious benefits for the entire organization. This is not unlike the parochial interests of individual branches/trades of the CF. 

Less obvious in the example is a reluctance to accept cultural change that the prospect of improved gunnery threatened to effect.  Improved gunnery would mean an entire shift in naval tactics and a heightened importance for the gunners themselves rather than the captain!!!  In 1906, one of the great naval theorists, Alfred Thayer Mahan, demonstrated exactly this mentality with his opposition to construction of the modern battleship with its single-calibre main batteries because “…such vessels would fight only at great ranges.  These ranges would create in the sailor what Mahan felicitously called ‘the indisposition to close.’  They would thus undermine the physical and moral courage of a commander.” 

Finally, it took intervention from an outsider to break through the bureaucracy and ‘stove pipe’ mentality to impose the innovation.    Although the events surrounding continuous-aim gunfire took place in the early twentieth century, Michael Tushman contends that the tensions explained above are very much in existence today. And I agree.