Measures for higher adaptability

Dear readers

What bothers me most in the last months is how uninspired managers deal with the crisis. Every day we read about more layoffs and other cost cutting measures. But no idea how to reorganize companies to restart very fast and to avoid the same situation in the future. It it is the same helplessness in management like in politics – as Davos has shown us.
I am no financial or economical expert, but for companies I have some ideas how to overcome the next crisis.

Improvement of Adaptability
We cannot escape and not control the complex reality of business. What’s to do? The answer is: Improve adaptability!
Adaptability has two directions. First, something is changing in the market, technology or whatever, and the company has to adapt as fast as possible to the new situation (assimilation). Second, there is an opportunity – merger, new market, research outcomes … - and the company has to take it faster than the competitors (accommodation).

There are three main factors hindering or fostering improvement of adaptability
1. Mindsets
2. Company structure
3. Organization

Mindsets
To foster adaptability you need an open minded management. Curious what could be different and open to discuss the assumptions behind decisions. A management able to use the power of the whole intelligence within the system.

What is needed is a learning culture, rewarding learning and openness. Such a culture will be also more innovative and creates faster problem-solutions.

For higher adaptability you need a Fleet Structure
Today, the question is no more about centralization or decentralization, big or small. Important is to develop the right goal setting process and the coordination of information. The network technology allows to delegate most functions to the operations. That is my picture with ships and a central “Tower”.
Ships around the world, acting as competent management systems and a central tower, to allocate information.

There are some principles to follow
• Each ship has its own market and future perspectives
• The management on a ship knows the business the best
• Ships may cooperate locally (same customers) and/or topically (logistics, aw materials) on
their own decisions
• Each ship can see and approach all others virtually

The functions of the Tower
• Set the genetic code
- What are our general business values
- What we not accept as company or individual behavior
• „Start-up“ function
- Financing a good idea with limited risks
• Goal accepting, financing and tracking
• Global information hub and Innovation Source
- Gather, analyze, interprete information from all units
- Give advice, support about opportunities and threats
• Defines the management systems
– IT/IS, Strategy Development, Goal Setting and Tracking

Using new organizational principles for higher adaptability
In my opinion the most important question will be, how to combine standardized processes with principles of self organization.
We learn from neurology that our brain manages complexity in such a way. There are standardized modules we cannot change. After a craniocerebral injury someone can’t perhaps indentify pots and other items any more, but he can recognize faces – there is a face recognition-module.
There are also visual modules. You see the world always foreshortened, but correct it through experience and knowledge.

Other processes are open organized. We learn and adapt. Imagine to be the first time in a self service restaurant. You will come in, sit down and wait. After a while you will realize: nobody want to serve you, there are no waiters. Now you start to learn: checking the situation, reorganizing your knowledge and behave in a proper way to get your food.

With such principles I am organizing complex processes. E.g. an analytical department in pharmaceuticals. There we can standardize some elements like chromatographs very easily, but let the whole group process with self-organization. We have given very few rules: Quantitative goals and GMP quality. And it works.

It is like the move from traffic lights to roundabouts. Roundabouts have in principle only one rule, but absorb more traffic with fewer accidents.

What do you think about these aspects? What is your experience in projects? What is your methodology to organize complex systems?

Thanks for your contribution.

Willi

First Post

It’s my first blog and post – I’m excited. Who will read it, who will answer it and give me continuative ideas. Swiss-German is my native language, but I hope everybody will understand and forgive me some mistakes.



Managers are Dreamers
Today I would like to tell – and hopefully to discuss afterwards – some experiences with managers the last few weeks.
There is a big lamentation about the crisis, but the reaction is mostly old fashioned cash-management. Is it about missing creativity, blindness or missing knowledge how systems work? I’m not sure about.
In a way managers are dreamers. They dream of a manageable world and manageability means “predictable and controllable”. Success depends in their opinion on good managerial systems and instruments. That explains the boom of planning and controlling tools for strategy development and implementation.
The crisis is discussed like an accident, caused by some stakeholders. My discussion partners were sure, they couldn’t make such mistakes – they are the victims now.


I don’t know what’s needed those managers accept, that the future is not predictable and we can’t manage no more in the old understanding of control. Perhaps they fear the insight: If the future is not predictable, success will be accidental. They resist reflecting the underlining assumptions to find new solutions. In the past we called it “double loop learning”. Today managers try only to improve, but always within the same assumptions.
In a biotope a lake may be a buffering element. That means we can use the environment of the lake in an extensive way, nothing will happen. But one day the lake will be slurry and the whole biotope will be dead.
In the complex field of management we don’t know the buffering elements, we don’t know which elements will form feedback loops through interactions, producing new facts we didn’t expect.
That’s the reality of complexity. Complexity is not manageable in the traditional way, it is not controllable. We have do find ways to deal with complexity to improve the probability of success – without any guarantee.
Cash Management is fine, but

“Complexity causes businesses to change in fundamental ways. Entrepreneurs who aren't prepared won't know what hit them.” Jonathan Byrnes.
And that’s what happens in the crisis.


I would appreciate, if you gave me your opinion about the blog-topics and started to discuss such aspects. The next days I will concretize the matter.


Bye for now,
Willi