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March 2010

Cover ArtistJacob Thomas

AbouttheSpotUght ArtlstThis month's featured artistis Felice Varini, a swiss-born painter who eschewsthe traditional canvas forthe three-dimensionalurban landscape. Varinipaints directly on existingarchitectural structuresor naturallandscapes,creating visually compellingeometric shapes that canbe seen only from a single,specific vantage point. Whenyou step away, the imageturns into fractured swathsof color.

"The vantage point is a wayto begin, to focus," Varinihas said. "sur l'rn reallytrying to discover things thatwe cannot normally see."

Varini lives in Paris.

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•Finding Your Strategy in the New Landscape The road ahead looks

rocky, with weak global growth, overcapacity, high unemployment, financialvolatility, costly capital, and more regulation and protectionism. To negotiate it,companies will need to shift-and maybe even reverse-their approach to globalbusiness. Pankaj Ghemawat

Roaring Out of Recession Though many companies never recover froma recession, a small percentage emerge stronger than ever. How do theybreak away from the pack? An analysis of 4,700 companies during threerecent downturns reveals the answer. Ranjay Gulati, Nitin Nohria, and FranzWohlgezogen

Are You Ready to Rebound? In the new world of irreducible uncertainty,companies need agility-the capability to consistently spot and execute onfavorable openings before rivals do. Here are seven questions that will help yougauge your company's fitness. Donald Sull

ABOVEFelice Varini'sFive ConcentricCircles, 2007. Paris

March 2010 Harvard Business Review 5

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FeaturesJ., .1'1

1 Funding Eureka!To turbocharge progress, the world needs a capital system

1 for inventions-one that would make it easier for inventors toget funding, for universities to turn scientific discoveries intomarketable products, and for companies to buy and sell ideas.Nathan MyhlVold

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Bold Retreat: A New Strategyfor Old TechnologiesWhen a new innovation threatens yourbusiness, the tendency is to fight itor transition to it. But a third option canoffer great promise. Ron Adner andDaniel C. Snow

Harnessing Vour Staff'sInformal NetworksExperts within companies often gathervoluntarily to swap insights. With somestructure and oversight, these communitiescan become powerful problem solvers.Richard McDermott and Douglas Archibald

Leadership Lessonsfrom IndiaOver the past decade, a distinctivemanagement style has helped lndia'slargest companies grow twice as fastas the country's red-hot economy.Peter Cappelli, Harbir Singh, JitendraV. Singh, and Michael Useem

99

How BMW Is Defusing theDemographic Time BombInexpensive changes on the factory floor-developed by frontline employees-arehelping BMW maintain the productivity ofan aging workforce. Christoph H. Loch,Fabian J. Sting, Nikolaus Bauer, andHelmut Mauermann

105

Giving Up the CEO SeatA cofounder of Seventh Generation hadguided his company through its infancy andadolescence. Then he suddenly realized itwas time to go. Jeffrey Hollender

6 Harvard Business Review March 2010

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BMW'Sfrontlineemployees aregetting older-but workingsmarter.

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Women in Management:Delusions of ProgressNew research shows that among MBAelites, women stilllag men at every careerstage. PLUSTackling the other climatechanger, engaging employees on their terms,marketing on Facebook, and more

28

The Mere Thought of MoneyMakes You Feel Less painCan cold, hard cash increase your physicaland emotional resilience? Yes, says professorKathleen Vohs.

GUANZHONG15 M POP.

1.9%GDP

T2.8%PROJ.GRQWTH

CENTRAL31 M POP.

3.8%GDP13.1% PROJ. GROWTH

CHONGQING" MPOP.1.8'l/oGOP

9.9%PROJ.GROWTH

YANGTZEMIO/LOWER32 M POPo

4.0%GDP1:2.1% PROJ. GROWTH

CHANGZHUTAN16 M POP.

2.2%GOPl1.3%PROJ.GRQWTH

Using the right data to targetChinese customers page 30

114

Keeping YourColleagues HonestConfronting ethical conflicts in the workplacecan be both emotionally wrenching andpolitically risky-so how do you go about it?By shifting your rnind-set in several importantways. Mary C. Gentile

8 Harvard Business Review March 2010

page 28

30

A Better Approachto China's MarketsCompanies entering China focus on cities'size. They should define markets by economicoutlook, consumer attitudes, and culture.

34 ROSABETH MOSS KANTERThinking outside the building is the keyto future breakthroughs.

36 JOSEPH E. STIGLITZCan better regulation tame the financialmarkets? The prognosis isn't good.

HEFEI23 M POPo

2.8%GOPl3.JII/oPROJ.GROWTH

NANJING24 M POPo4.80f0GOP

11.0% PROJ. GROWTH

SHANGHAI35 M POPo

1O.8%GOP

B.7%PR'

NANCHANG12M POPo

1.1%GOP

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HANGZHOU32M POPo

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Retooling again and againpage 132

121The CEO Can't Afford to Panic Duringan unthinkable crisis, a chief executive has tomake a fast decision. frie J. MeNulty

128 Reviews

132Richard Serra An acclaimed Americansculptor whose signature material is rolledsteel talks about creativity, innovation, andcollaboration on a massive scale.

RES.ARCH

Idea Watch'seditors trackintriguingresearch ona new blog.blogs.hbr,org/research

THECONVERSATION

The smartestminds in man-agement shareideas andexperience.blogs.hbr.org/conversation

NEXT MONTH'SCASESTUOY

Is it a good ideato return to acompany you'veworked for inthe past? Tell uswhat you'd do.hbr.org/magazine

MORERECOM-MENDATIONS

A roundup ofwhat HBReditorsand contributorsare reading,watching, andthinking abouthbr.orgj'recommended

ATUL GAWANDE

A conversationwith the authorof rhe ChecklistManifestowreviewed onpage 130blogs.hbr.org/ideacast