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Published: August 25, 2004

 
 

Post-capitalism's Drop-out Prophet

In the early 1990s, the family-controlled U.K. specialty retailer was in the red, suffering from a combination of overexpansion of its retail outlets and dependence on what had become an overly complex and costly outsourced network of manufacturers.

Over the next two and a half years, Dr. Maxmin led a series of changes, fixing problems in manufacturing and logistics that foreshadowed principles of The Support Economy. For example, he entered into a strategic alliance with FedEx (then Federal Express), forming a sort of proto-federation, aimed at improving distribution for close to 500 Laura Ashley stores. The alliance was established as a 10-year partnership, but it was relatively open-ended, premised on trust. The objective was to be able to supply 99 percent of Laura Ashley’s merchandise to customers anywhere in the world within 48 hours. The alliance replaced a legacy system that would route a T-shirt manufactured in Hong Kong to a warehouse in Newton, Wales, before sending it to a retail store in Japan.

In 1992, Dr. Maxmin led Laura Ashley to its first gross profits since 1989, and in fiscal 1993, gross profits were expected to reach 12 million pounds. But in early April 1994, two weeks before his wife’s epiphany on national television, Dr. Maxmin abruptly resigned from Laura Ashley, citing major differences over strategy with Sir Bernard Ashley, who was still a major shareholder. The company was eventually broken up and sold.

That spring marked a personal and professional turning point not just for Professor Zuboff, but for Dr. Maxmin, too. With his departure from Laura Ashley, he was able to reflect on the several decades he’d spent trying to turn companies around. He had become disillusioned. It was “more than Laura Ashley, it was the experiences at Volvo and Thorn,” he says today. “You’d feel successful if you could just get the business to work. But that never got you to high levels of employee and customer satisfaction. That is a significant indicator there was something wrong with the business model.”

With Dr. Maxmin’s departure from Laura Ashley, the couple began to rethink their lives. Like the disaffected individuals of their book, they decided to change the way they engaged with the business establishment, seeking networks of deep support for their family and pursuing new approaches to their careers. Professor Zuboff took a year’s leave of absence from Harvard. They built a large wood-shingled house, furnished in Laura Ashley–style English country décor, on a 200-acre deer farm on Lake Damariscotta, in southern Maine. The property includes guest cottages, one of which serves as Professor Zuboff’s book-strewn study. The house also contains a schoolroom for their children.

Homeschooling represents the family’s effort to craft an individualized education experience — in the spirit of the support economy — for their children. They provide their own skills as parents, and reach for an eclectic array of educational specialists. Most Tuesday and Thursday mornings, Professor Zuboff works with Jake on English language skills and Spanish. Dr. Maxmin is the geography teacher. The couple share history instruction. They have found experts to tutor the children in other subjects, including math, science, Latin, and music.

Messy Beginnings
In 2004, finding signs of the support economy in business is almost as difficult as identifying the precursors of Henry Ford’s assembly line was for students of proprietary capitalism. It would have taken patience and prescience to troll through steel foundries and machine shops to see a revolution in the haphazard experiments with standardization and time-and-motion studies conducted by the pioneers of scientific management.

Still, one can see the support economy’s messy beginnings in such things as convergent cross-industry alliances (e.g., retailers and logistics companies) that focus on changing consumer needs and the value of unique experiences for individuals. There are also parallels in the open-source movement. Much like a federation, the open-source community relies on a voluntary, geographically dispersed group of software engineers, outside a formal organization, who create software products for particular markets or applications. The rules of open-source software development ensure that the product is constantly improved and free to anyone who wants to use it.

 
 
 
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Resources

  1. Art Kleiner, “The World’s Most Exciting Accountant,” s+b, Summer 2004; Click here. 
  2. “New Pact to Ease Hassles of eBay,” Wall Street Journal, June 17, 2004
  3. “Laura Ashley and Federal Express Strategic Alliance,” Harvard Business School, December 4, 1996. Case Number 9-693-050; Click here. 
  4. C.K. Prahalad and Venkatram Ramaswamy, The Future of Competition: Co-Creating Unique Value with Customers (Harvard Business School Press, 2004)
  5. Thomas W. Malone, The Future of Work: How the New Order of Business Will Shape Your Organization, Your Management Style, and Your Life (Harvard Business School Press, 2004)
 
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