Why did a logically sound procurement policy fail to gain adoption?
DRW Technologies' newly hired Corporate Vice President of Procurement entered with a clear cost-reduction mandate. His policy required plant managers to submit contracts over $250,000 for prior approval—a rational attempt to capture economies of scale. Yet the policy did not take hold. The analytical problem is not simply whether the policy made economic sense, but whether the organization was aligned to support it.
The failure was not one of logic. It was one of alignment.
Strategy does not operate in isolation. It enters systems already shaped by structure, culture, incentives and leadership psychology. At DRW, non-adoption was a predictable outcome of introducing centralized control into an organization whose operating logic rewarded autonomy, responsiveness and relationships.
Structure can't ignore psychology.
Five sources of misalignment.
The policy's failure can be traced through five connected dimensions. Each one weakened the ability of formal authority to become actual organizational behavior.
Non-adoption was rational alignment with the system that already existed.
Realign the system instead of reinforcing the directive.
The response should not be stricter enforcement. It should be a redesign that makes cost discipline compatible with the way DRW actually operates.
Strategy becomes actionable only when the system can carry it.
Realigning structure, culture, incentives, and leadership approach is not optional; it is the condition under which strategy becomes actionable.
Analysis built from a Harvard Business School Briefcase.
Source case: DRW Technologies, Stephen A. Greyser and William Ellet, Harvard Business School Briefcase, 2015. This page presents Tiffany N. Watson's independent analysis and recommendations; the underlying case is not reproduced here.