[01] Mariela K. Farhi-Zimmerman, Department of International Business, Vysoka Skola Ekonomicka, Praha, University of Economics, Prague, Czech Republic.

This article is divided into two sections. The first of these highlights a macro- approach to the importance of government and market institutions. The second focuses on the organization of businesses at the micro-level. Both approaches interact mutually, each bearing influence on the other. Macro approach: Examples of successful government initiatives will be presented. They had national leaders who forged consensus on economic objectives and the means to achieve them. They created institutions that were able to exploit technological possibilities and move-up to high-income status. Countries whit have weaker institutions and non-effective leadership and commitment, are severely handicapped. Their economic growth suffers consequently. The healthier and more robust institutions in a society, the better quality of life and higher economic growth. Micro approach: Within the micro approach of economic policy for development we present to case studies that have implemented change management in a strategic way to achieve higher and more competitive results. Case Studies:1- The New York City Police Department (NYPD) presented an interesting example of effective institutional change. Key steps for change through persuasion are explained in the paper. 2- IBM Company. This case study highlights the value of dialogue to implement change. Theory of Change: Implementing change is a difficult challenge. The basic theories of change known as Theory E & 0,it is premised on change being a function of economic values. Conversely, Theory O ascribes change to organizational capacity. Only, the integration of theories E and 0 can create major change – and as a result major payoffs. Another Theory of change, the Theory of Groups and logical types- can also explain a way of implementing change in an organization. Both case studies used both approaches. Details are presented in the manuscript. Conclusion A sustained advantage in today’s economy can come only from a constant ability to develop organizations for the long term combined with a constant monitoring of shareholder value- E dancing with 0, in an unending minuet.

Sustainable, Development-Institutions-Government, Incentives-Business-Change, Management-Change, Theories-Dialogue-Social, Operating, Mechanisms

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