A Brave New World

This week the World Economic Forum kicked off in Davos – and as always, we will be following it with interest and alerting our clients and readers to interesting forums and discussions.

Not coincidentally, this is also the week that we are launching our new “Brave New World” initiative. The tough economic times continue to a greater or lesser extent depending on your perspective (country, industry, region, …) and we believe the green shoots are showing or about to show. The biggest challenge many organisations face is that the business environment has changed fundamentally but many are still looking in the rear-view mirror to plan the road ahead. Coupled with that is that many are also in survival mode – with a strong internal focus on cost containment.

Resources tend to be stretched especially at executive level and although we know we should be considering the broader trends and fundamental changes that have been happened, we seldom give ourselves the opportunity to read and absorb some of the material out there (such as is coming out of the World economic Forum) – to say nothing of sitting down as an executive team to discuss the implications and opportunities for the organisation.

The BraveNewWorld challenge is to change this mindset in your organisations (if it exists) and proactively look at the new “world” you will be facing, with a perspective of seeking opportunities and growth. Taking the time out to assess the future NOT through the perspective of the rear-view mirror, but from the perspective of what the future might look like. Contact me at BraveNewWorld@GenesisMC.co.uk to discuss how we might be able to offer assistance in this process.

Back to Davos, the theme of this years conference can best be described using Professor Klaus Schwab’s words:
“Today, we live in the most complex, interdependent and interconnected era in human history. We are increasingly confronted by major adaptive challenges as well as profound transformational opportunities. This new leadership context requires successful organizations to master strategic agility and to build risk resilience.”

Later posts will discuss specific debates at Davos, but for this first post I should like to bring to your attention the WEF TV channel at http://www.weforum.org/events/world-economic-forum-annual-meeting-2013 . As I write this, I am watching a discussion called “De-risking Africa” with discussions from Clayton Christensen (disruptive technologies) and Global Risks due in the next few hours. Incredible stuff and whether or not you agree with the opinions expressed, it should certainly stimulate your thinking.

And finally, congratulations Charlize on your Crystal Award. Beauty, brains and empathy  …..  an exceptional and rare combination.

 

 

 

 

Posted in Decision related material, Scenario analysis support, Special offers, Strategy - general, Visualisation, WEF and davos | Leave a comment

Visualisation in action: Gong Szeto

Here is a GBN interview with Gong Szeto.  Hard to describe what he really is … architect? artist? problem solver? data miner? …

Best said he seems to be brilliant at understanding complexity with blackboard and chalk. Drawing pictures and interconnections to get to grips with the complexity of the situation. In one of the 7 habits of highly effective decision makers, we said: “combat complexity with visualisation”. Well, it seems that Gong is living proof that this works.

There does not seem to be any underlying methodology, except working on the principle of “insight-decision-action” – which means understanding why is anyone looking at the situation in the first place? What do they want to do with it? Because that is what frames the image.

So have a look at the interview and then browse around his web-site a little. I cannot promise you will fully understand, but I think I can promise you will be at least fascinated .. and maybe a little inspired?

GBN interview with Gong Szeto

Gong’s web-site

Although we at Genesis would not claim to be able to do identical work as Gong, we are able to help you think through the complexity of a situation and with some advanced tools and technology. We will assist your team in making sense of the situation and identifying the key drivers and risks.
Contact us for a discussion at sgifford@genesis-esp.com

 

 

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Global Trends and Issues: 2012 World Economic Forum

The Global Agenda Survey asks members of the Global Agenda Councils to identify and predict the most important global trends that will likely impact the world economy, society and environment in the next 12-18 months. The findings are used to draw out important and revealing inter-linkages between the perceptions and actions of business, political and academic leaders.

Extract from report

This is a survey well worth reading when considering the trends that will face both private and public sector in the near future. There are some superb interactive graphics that allow for quick drilling down into those things that are relevant to you.

WEF Global Issues: 2012

You may like to consider using this as input to your strategy review or strategic planning session – we would be delighted to facilitate such a session using this material as input together with state of the art technology that could transform that session into a memorable and important event. Contact me at sgifford@genesis-esp.com to discuss this.

 

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Shut up and listen!

Here is a useful article from a great blog called Rethinking Complexity, out of Saybrook University. It challenges you to put aside preconceptions and really listen – even when what you are hearing goes against your fundamental beliefs. It does this via a simple exercise (simple to understand, not so simple to do!).

It discusses Edmund Husserl’s concept of “bracketing” which means setting aside your preconceptions. Which will allow you to really listen and hear what the other party is saying. If you are trying to understand each other; or perhaps attempting to reach an agreement over something, this becomes really important. If you are simply trying to win an argument rather than gain mutual understanding – then this is not for you. I suspect we often find ourselves in this latter area (wishing to win an argument) when we really should be looking to gain a mutual understanding. It is obviously best if both parties are putting their pre-conceived notions aside.

The technique requires a high level of emotional maturity as well as an ability to meta-think (to think about what we are thinking about).

Are you up to trying the exercise? It really could benefit your decision making if you can allow yourself to hear contradictory perspectives and evaluate them objectively – not in the frame of your own pre-conception.

Find the article here at:

“Bring in ‘da noise, bring in ‘da funk”

At the end of the month, I am giving part of a series of lectures to a group of female managers in a major steel company. I am planning to use this technique to see if it will help bring some clarity to the myths, mis-perceptions and facts around women in business. I will keep you posted.

 

 

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Effective decision making

My alma mater, Deloitte seem to have cottoned on to the importance of strategic decision making and issued a useful article on the topic. Their premise is that the CIO and CFO in collaboration are in a good position to improve decision making within an organisation.

I am in agreement with their premise – in fact any combination of executives with different perspectives is useful. Furthermore, as all my readers know, I am a huge supporter of visualisation as a way of combating complexity. My main point of disagreement with the Deloitte document is that I have not found that many CIO’s who are the experts in data (or other) visualisation techniques – although as head-honcho’s of the data, they perhaps should be.

The article also discusses behavioral issues in some detail and they have done a good job of categorising the type of heuristics that we use – either as individuals or in groups – that can cause blind spots and errors.

The document mentions that the decision process is one way of making better decisions. Genesis Decision FrameworkAlthough they do not give an example, the Genesis Strategic Decision Process has appeared in our blog and web-site a number of times and is easy to find if you are looking for your own process – alternatively drop me a line at sgifford@genesis-esp.com and I will forward you a copy.

My only other suggested addition to the article would be that to address the behavioral issues of decision-making, it is critical to obtain inputs from a wider group of people than simply the executive team. Be that seeking expert input or simply tapping into the wisdom of crowds. Simply getting the process right is not enough.

Overall – well done Deloitte. A useful article.

Decisions that matter – and how to make them better.

To discuss improving decisions in your organisation,
contact me at sgifford@genesis-esp.com for a no-obligation discussion

 

Posted in 7 Habits Series, Decision related material, Strategy - general, Visualisation | 2 Comments

Billionaires and biology

A number of blogs, ideas and headlines have come together to write this article stimulated by some thoughts around “biomimicry”  (creating solutions designed by nature), a topic that has been around for a while but is now being taken more seriously by business thought-leaders.

The first article came from a blog called The Nature of Business and was titled: “Super organisations – learning from nature’s networks” which applies aspects of complexity theory, particular the analysis of networks, to the state of the economy and business today. That sounds like a tough read, but it is surprisingly easy-going and a fascinating article showing how nature organises itself and how there are lessons for business.

That led me to a second article about risk and resilience from a web-site called “Business Inspired by Nature”. It shows how natures uses 3 strategies for building resilience: decentralisation, redundancy and diversity. This is really important. Genesis, along with one of our partner organisations: Consileo (specialists in building resilience through insight and foresight), are convinced that with the increasingly uncertain environment, resilience must be one of the prime requirements for all organisations. The increased possibility of unexpected exogenous shocks, together with coping strategies that are unlikely to be based on past experiences, demands that organisations must build in resilience and the ability to act at the front-line independently and spontaneously. It is clear that nature can provide us with lessons and metaphors that could help us to survive and thrive in these environments.

You are probably wondering where the “billionaires” (from the title) comes into this thinking. That came from a recent Forbes article in August putting Amancia Ortega ahead of Warren Buffet on the billionaires list and in third place overall. To me, Amancia’a organisation Inditex (owner of Zara and other brands), is a great example of a company that (perhaps deliberately or perhaps intuitively) uses nature-type strategies in their own strategies. A detailed description of the Inditex strategy would lengthen this article too much (and it  is easy to Google it), but they manage their entire business more as an ecosystem than a traditional business with boundaries. Built-in flexibility and speed to react are key survival mechanisms that provide its competitive advantage. Latest results of 12% profit increases and 10% revenue, the third consecutive year of growth in an impossibly-tough economic climate, combined with an increase in head-count demonstrates that their strategy is working.

The quality of decision making within an organisation is key to its success, survival or failure. I believe the three resilience building mechanisms adopted by nature hold lessons for how we make decisions in our business to build our own resilience:

  • Decentralisation (performing a function or responding to a disturbance in many distributed locations throughout an organism or system
    rather than in a single or centralized location).
    For example: encourage decentralised decision-making so decisions are made where they are best-informed and which can result in rapid response
  • Redundancy (performing a function or responding to a disturbance in more than
    one way.
    For example: when forced to decide what to do about a specific challenge (such as shrinking revenues), consider a number of different alternatives and allow those options to be explored and applied differently in different areas (locations, divisions, units).
  • Diversity (constantly seeking new and different ways of performing functions or responding to disturbances.)
    For example: find different ways of reacting to challenges and ensure that your decisions are are not based on “how we did it before” heuristics.

How might you go about putting this thinking into practice? It really will require some time and courage. Time to move out of fire-fighting operational mode and give yourself and your team some time to consider your current position and levels of resilience. Courage to move from tried and tested responses and explore some more innovative actions that may help you move from survival-thinking to a thriving-mentality.

Genesis Management Consulting would be delighted to facilitate a workshop with you and your selected team (not necessarily your Executive Committee!) to investigate these options.

For further reading:
Superorganisations – learning from natures networks.
Risk and resilience: how can I protect my organisation from future risk

And a new book that I have not yet started, but comes highly recommended by my colleagues:

Resilience: Why Things Bounce Back

 

 

 

Posted in Business Models, Decision related material, Strategy - general | Leave a comment

Information Overload and Decision Making

John Payne, a Professor at Duke Institute for Brain Science and gave an excellent TEDPhoto of John W. Payne talk around information overload and decision making. At the bottom of the page is a link to the 10 minute video (where there is a transcript as well).

As a quick summary, the Professor states that the problem we tend to face in decision making is not scarcity of information (in fact to the contrary we often have information overload). He claims the main challenge is scarcity of attention.
(My view is that the word “attention” may be a little narrow and covers a number of items (some or all of which may be present) such as time availability, ability to understand or process the information provided and capacity to make trade-offs.)

He uses a good example of information overload in decision making in talking about the 4 medical plans offered to him at the University – each of which had 33 different features such as additional costs for care and ambulance services. A second more common example is simply trying to select a mobile phone provider and plan – the options are dizzying and often hard to compare.

The most common results of this excess information are:

  • Decision avoidance or procrastination
  • Selection of the default (for instance staying with what you have always done before or maintaining the status quo)
  • Reverting to simple heuristics and using less information or using it in a less complex way (for instance: is it acceptable or not).

Human beings have survived on heuristic-based decisions for millennia and often they result in very good decisions – but not always. Sometimes they can lead us to focus on some pieces of information and ignore others. What will make us focus on a specific piece of information may be based on our values, but may also be based on the context in which we are making the choice – which includes the way in which the information (or decision selection)  is presented.

John provides a number of ways of dealing with this. Firstly, the providers of the information should aim for “cognitive fluency” – basically how well the information is presented visually; as well as “emotional fluency” which is how well you are able to interpret the information. Lack of cognitive fluency may lead to the data being ignored and lack of emotional fluency may lead to incorrect processing of that information.

A second (and to me more important) piece of advice is that one should try and get in touch with your values and objectives in taking the decision before one even starts examining the information provided. This aids in making “value-based decisions”. And in a world crowded with info, this becomes increasingly more important.

He gives a simple example in the video using 3 cards (gold, silver and bronze) and writing prioritised objectives on each of them. He also demonstrates good use of visual information in the video by referring to a display notice detailing how environmentally friendly is a certain car.

One area John briefly touches on, but is worth considering in more detail, is “choice architecture” that is how the decision is put across, including what is the default. There are many examples of where a very simple change in choice architecture may have a dramatic effect on the results. One example of is this architecture is in how people are asked if they wish to donate organs. A simple default opt-in to the programme (requiring a conscious opt-out action) has been shown to have significantly better results than the opposite (default opt-out). Thalers book “Nudge” also gives many examples of this. Obviously ethics and values can become important considerations here – but that is the topic of another publication.

This work is of particular importance to us at the moment as we are currently undertaking work in the UK where we are assisting local government in implementing “choice” policies for vulnerable adults who receive support from the State. The idea that too much choice may not be good, seems to have been ignored by the Department of Health – especially considering that many of these people have less mental and/or emotional capacity than the general population. The second area where it may be important in this work will be in helping these Local Authorities in constructing decision architecture around the choices.

If you still have time, enjoy the video – you will find it at the link below.

John Payne on TED

The science around decision making, managing information overload, and complexity and choice architecture is important in many aspects of our personal