Proposed changes to UK Corporate Governance Code - http://www.chaordicsolutions.co.uk/blog/from-our-grc-consultants/proposed-changes-to-uk-corporate-governance-code/

http://www.chaordicsolutions.co.uk/blog/from-our-grc-consultants/proposed-changes-to-uk-corporate-governance-code/

Proposed changes to UK Corporate Governance Code: risk management now one of the most important board responsibilities.

 

Extract from Financial Reporting Council (FRC) Press Release – 6 November 2013:

The Financial Reporting Council (FRC) has published for consultation changes to the UK Corporate Governance Code, guidance for boards of listed companies and standards for auditors covering risk management and reporting. Supplementary guidance for directors of all banks is also being issued.
 
The proposals build on the FRC’s work on “Boards and risk” and aim to raise the bar for risk management by boards and communication to the providers of risk capital about the risks faced by companies in which they invest and how they are managed or mitigated.
 
In response to concerns expressed on earlier proposals issued in January, these new proposals set out afresh how the FRC will  implement the recommendations of Lord Sharman’s 2012 Inquiry ‘Going Concern and Liquidity Risks: Lessons for companies and auditors’. The Inquiry looked at the corporate governance and reporting lessons to be learnt from the failure of ostensibly healthy businesses in the financial crisis.
 
The FRC has made a key change in these proposals by bringing together its previous guidance on risk management and internal control with the assessment of the going concern basis of accounting; so encouraging the integrated assessment and reporting recommended by Lord Sharman.
 
Melanie McLaren, Executive Director, Codes and Standards, said: 

“Risk management is one of the most important responsibilities of the board. Understanding the principal risks facing the company is essential for the development of strategic objectives, and the ability to seize new opportunities.  For investors, as providers of risk capital, knowing how the board is managing and mitigating risks is an important indicator when judging whether the company will be able to deliver the value that investors seek. The new guidance, and the proposed changes to the Code, highlight the issues that boards need to consider when assessing and managing risk, crucially including risks to solvency and liquidity. We have placed considerable emphasis on the need for robust assessment by boards and on the important role of auditors in ensuring reliable communication to investors.”

 Broader Risk Considerations and Role of the Auditor
 
The draft guidance sets out boards’ responsibilities for setting the company’s risk appetite, ensuring there is an appropriate risk culture throughout the organisation, and assessing and managing the principal risks facing the company, including risks to its solvency and liquidity. As now, boards should summarise the process applied in reviewing the effectiveness of the system of risk management and internal control.  There is a new encouragement to explain what actions have been or are being taken to remedy any significant failings or weaknesses identified from that review.
 
Under the proposals, auditors will be required, in meeting their current requirement to consider whether reporting is fair, balanced and understandable, to consider and report if they are aware of any material matter in connection with the disclosure of principal risks that should be disclosed.
 
Solvency and Liquidity Risks and Going Concern
 
In response to the recommendations made by Lord Sharman the FRC proposes a new Corporate Governance Code provision and related guidance. They establish the need for a robust assessment by companies of how they manage or mitigate their principal risks, including risks to solvency and liquidity, and to explain which if any of those risks have also given rise to material uncertainties for the purposes of reporting on the company’s going concern basis of accounting.  The FRC is, therefore, proposing to remove the current Code provision requiring listed companies to make a “going concern” statement. That statement is focussed on the narrow meaning of assessing the going concern basis of accounting, and so detracts from the broader integrated assessment and description of solvency and liquidity risks envisaged by Lord Sharman.
 
Banking considerations
 
The Sharman Inquiry also looked at whether a special disclosure regime is required for banks and concluded that this should not be necessary.  The Inquiry considered it important that the FRC should clarify that a conclusion that a bank is or would be reliant, in stressed circumstances, on access to liquidity support from central banks that is reasonably assured, does not necessarily mean that the bank is not a going concern or that material uncertainty disclosures or an auditor’s emphasis of matter paragraph are required.
 
The FRC issued guidance for banks along those lines in January which found general support. Accordingly, the FRC is also now consulting on supplementary guidance to directors of banks updated only in respect of the proposed integrated guidance and developments in the regulatory regime.
 
Feedback Statement and Other Companies
 
 A detailed feedback statement on the FRC’s January proposals is also being published today. Those proposals extended to unlisted entities other than banks and met with considerable adverse feedback. The FRC plans to consult in 2014 separately on draft guidance for directors of such companies and is currently considering the development of simpler and more proportionate guidance.
 
The consultation announced today closes on 24 January 2014.  The FRC expects to issue the final Code, guidance and standards in the middle of 2014 with application for financial years beginning on or after 1 October 2014.

More … http://frc.org.uk/Our-Work/Publications/FRC-Board/Consultation-Paper-Risk-Management,-Internal-Contr.aspx

Panellist at MetricStream Operational Risk Roundtable event in London - http://www.chaordicsolutions.co.uk/blog/from-our-risk-management-consultants/panellist-at-metricstream-operational-risk-roundtable-event-in-london/

http://www.chaordicsolutions.co.uk/blog/from-our-risk-management-consultants/panellist-at-metricstream-operational-risk-roundtable-event-in-london/

Our Senior Partner, Robert J Toogood, will be panellist at MetricStream Operational Risk Roundtable event in London.

Extract from MetricStream Press Release:

MetricStream, the market leader in enterprise-wide Governance, Risk, and Compliance (GRC) solutions, will co-host a roundtable with HCL on Operational Risk Management in London on October 15, 2013.  Leading research analysts and subject matter experts on operational risk will convene at the event to share their ideas, views, and best practices when it comes to today’s biggest issues and challenges in operational risk management.  The event will also highlight innovative ways to build a sustainable operational risk management culture, driven by the proven capabilities of advanced integrated risk management technology solutions.

Our dynamic, volatile, and global marketplace is fraught with risks, rising customer expectations, a flurry of complex regulations, disruptive technologies, and mounting competition.  On top of that, internal and external challenges such as fraud, human error, natural and man-made damage to physical assets, and system failures also threaten business viability and business performance.  Today, effective operational risk management is not just a business necessity, but a strategic imperative.  Embedding an effective operational risk management program into the day-to-day business operations can help avoid substantial organizational loss.  This can also enable businesses to collaborate, transcend silos, and correlate information that provides risk insight that can guide strategic business decision-making at the executive management level.

Event speakers include Piyush Pant, Vice President of Strategic Markets at MetricStream, Cedric Merahi, Risk Management Specialist at ActivSi, David Paris, Global Solutions Partner at HCL, Philip Martin, Chief Executive at Enterprise Risk Advisors, and Robert Toogood, Senior Partner at Chaordic Solutions.  Hosted in association with HCL, the roundtable will feature two different panel discussions – Role of Operational Risk Management within the Enterprise Risk Management Structure and Incorporating Operational Risk Intelligence into Strategic Business Decisions.  These sessions will underscore the need for organizations to gain complete control over operational risks, which have the potential to impact other risk areas, and jeopardize an organization’s operations and reputation.

Assumptions on financial scandals challenged - http://www.chaordicsolutions.co.uk/blog/from-our-risk-management-consultants/assumptions-on-financial-scandals-challenged/

http://www.chaordicsolutions.co.uk/blog/from-our-risk-management-consultants/assumptions-on-financial-scandals-challenged/

Assumptions on financial scandals challenged: effective risk culture also needs climate of trust and communication.

 

Extract from LSE and Plymouth University Press Release:

Joint research from London School of Economics (LSE) and Plymouth University published today (31 October) dispels ‘myths’ that poor or deviant risk culture in financial institutions was mainly responsible for recent scandals.

The report, Risk Culture in Financial Organisations, says that current debates misleadingly equate risk culture with greater precaution and risk aversion.  It challenges the notion that there is a clear distinction between ‘strong’ and ‘weak’ risk cultures.

One of the report authors, Professor Mike Power, an academic expert in risk management from the LSE, comments, “The risk cultures of financial organisations are full of trade-offs, and how they manage those trade-offs is fundamental.  This clearly includes, but is not restricted to, the need to balance risk and return.  In addition, we find that ‘good’ risk culture is as much about organisational clarity and confidence in making these trade-offs, as it is about the level of risk taken as such, or indeed about ethics.”

The report also questions the direction of certain financial sector reforms, including the significant focus on issues such as governance, ethics and incentives.

Professor Power led the 18-month project in association with Dr Simon Ashby from Plymouth University, who is also a former financial regulator and risk management practitioner, and Dr Tommaso Palermo from the LSE.

Lighthill Risk Network is one of the consortium of private bodies funding the work. The other members of the consortium are the Chartered Institute of Management Accountants and the Chartered Insurance Institute in association with the Government funded Economic and Social Science Research Council (ESRC).

Lighthill Risk Network director Dickie Whitaker says, “Reports on the financial crisis, such as the work of the Parliamentary Commission on Banking Standards, as well as numerous investigations into more recent scandals including LIBOR fixing and the London Whale, all highlight the significance of deviant risk cultures which have permitted unethical and destructive behaviours.

“However, to date, despite this great interest, there remains a significant lack of clarity about what the concept of risk culture actually means and therefore about how financial organisations should go about ‘strengthening’ their risk cultures. The report provides a unique perspective on the concept of risk culture and fills a key gap between academic research and industry practice.”

The team’s aim was to work with senior risk managers from a number of financial organisations to effect knowledge exchange, providing insights to improve their ability to understand and potentially manage their risk cultures.

It looked to reinforce its practical experience in risk management, and contacts from the financial services sector, with a robust academic approach to investigating the risk cultures of financial organisations.

Challenge to sector reforms

The report also challenges the direction of certain financial sector reforms, including the significant focus on issues such as governance, ethics and incentives. For example, the report highlights some key issues with the “three lines of defence approach” that is increasingly popular within financial institutions, where the staff within central risk functions are kept at arms-length from business level decision making.

Dr Simon Ashby comments, “The three lines of defence approach has a fatal flaw – while it may prevent risk staff from getting too involved in business level decisions and thus ‘going native’, it can also drive a wedge between risk staff and business management – leading to mistrust and mis-reporting.

“Often it is better to blur the first and second lines as this can improve interaction between staff.  In the end risk culture is as much about creating a climate of trust and communication as it is about lines of demarcation”.

The report is published by the Financial Services Knowledge Transfer Network and is available at http://www.lse.ac.uk/researchAndExpertise/units/CARR/home.aspx

Running workshop for Jersey branch of ICSA - http://www.chaordicsolutions.co.uk/blog/from-our-grc-consultants/running-workshop-for-jersey-branch-of-icsa/

http://www.chaordicsolutions.co.uk/blog/from-our-grc-consultants/running-workshop-for-jersey-branch-of-icsa/

Running workshop for Jersey branch of ICSA: about value of establishing culture which supports ethical behaviour.

 

 

Our Senior Partner, Robert J Toogood, is running a workshop session for the Jersey branch of the Institute of Chartered Secretaries and Administrators (ICSA) on 1 October, about the value of establishing a culture which supports ethical behaviour and established ‘self discipline’.

For the last five years, the ICSA Jersey Branch has organised a popular series of one hour evening workshops for its members, students and non-members … and this session is the first in the 2013/2014 series.

Robert will be presenting the workshop in conjunction with Helen Hatton from Sator Regulatory Consulting.  Helen will provide an introduction on the regulatory intervention role ‘regulatory discipline’ arising when ‘self discipline’ fails.  Robert will then talk about the value of establishing a culture which supports ethical behaviour and established ‘self discipline’, thus improving governance, compliance and effectiveness.

More … http://www.icsajersey.org.je/ICSA-Jersey-Branch-Seminars/evening-workshops-2013-2014.php

Steps for navigating complex projects identified - http://www.chaordicsolutions.co.uk/blog/from-our-programme-and-project-management-consultants/steps-for-navigating-complex-projects-identified/

http://www.chaordicsolutions.co.uk/blog/from-our-programme-and-project-management-consultants/steps-for-navigating-complex-projects-identified/

Steps for navigating complex projects identified: success determined by mix of capabilities applied not complexity.

 

Extract from Project Management Institute (PMI) Press Release:

Project Management Institute (PMI), the world’s largest not-for-profit membership association for the project management profession, today announced the release of Pulse of the Profession™ In-Depth Report: Navigating Complexity. Expanding on findings from the 2013 Pulse of the Profession, which revealed that companies risk $135 million for every $1 billion spent on a project, the new complexity report reveals that average budgets for projects that are highly complex are nearly twice as large than those with lower levels of complexity—using significantly more resources and putting even more dollars at risk for the organizations managing them.

Although there may be a perception that navigating complex projects requires a different set of skills or capabilities, PMI’s research proves otherwise. Regardless of the number of highly complex projects, organizations are managing projects with relatively the same set of project management techniques, methods and practices, and have about the same level of project management maturity. Further, PMI’s research confirms that a project’s success or failure is not determined by the degree of complexity, but by the mix of capabilities applied.

While the new report finds several commonly reported attributes of complex projects, including ambiguity and divergent stakeholder agendas, there are no universal parameters for defining complexity. Engaging in debate about a definition may only serve to distract organizations from implementing practices that will improve the outcomes of all projects and programs.

As reported in the 2013 Pulse of the Profession, high-performing organizations have mature project management practices, align their talent management with organizational strategy, and are significantly more likely to be highly effective communicators. High-performing organizations achieve an average project success rate of 80 percent, and risk 14 times fewer dollars than low performers.Considering that average budgets for highly complex projects are nearly double those with less complexity, success in this area translates into a big boost to the bottom line — and requires more attention from organizations.

Additionally, the complexity in-depth research finds that high performers are focusing on specific capabilities within these three broad areas to manage highly complex projects:

1. Create a culture of project and program management with engaged project sponsors.

Organizations with mature project management practices average a significantly higher percentage of projects meeting original goals and business intent compared to organizations with less mature practices. Pulse research reveals that 79 percent of projects undertaken by high performers have active project sponsors, compared to less than half (43 percent) at low-performing organizations.

2. Assess and develop talent with a focus on fostering leadership skills.

Among successful organizations, leadership development is most aligned to organizational strategy. PMI’s Pulse of the Profession In-Depth Report: Talent Management revealed that 70 percent of organizations have aligned their leadership development program to organizational strategy.

3. Communicate effectively with all stakeholder groups.

As revealed in PMI’s Pulse of the Profession In-Depth Report: The Essential Role of Communications, one out of two failed projects can be attributed to poor communications. High performers report that effective communications to all stakeholders—more than any other factor—has the greatest impact on highly complex projects, and place more importance on effective communications than low performers do.

Consistent success of projects, regardless of the level of complexity, stems from mature project management practice that is rooted in sound fundamentals, including effective stakeholder management, transparent communications, engaged project sponsors, and strong alignment of projects and talent development to high-level strategy. With a solid project infrastructure in place, organizations can achieve success by adapting to and addressing the myriad factors that contribute to project complexity.

The 2013 Pulse of the Profession™ In-Depth Report: Navigating Complexity is the latest follow-up study to PMI’s benchmark 2013 Pulse of the Profession™ report, which charts the major trends for project management.

More … http://www.pmi.org/Knowledge-Center/Pulse/Complexity.aspx

 

Quick, easy, reliable resource to assess organizational culture - http://www.chaordicsolutions.co.uk/blog/from-our-change-management-consultants/quick-easy-reliable-resource-to-assess-organizational-culture/

http://www.chaordicsolutions.co.uk/blog/from-our-change-management-consultants/quick-easy-reliable-resource-to-assess-organizational-culture/

Quick, easy, reliable resource to assess organizational culture: starting point for sustainable, successful change.

 

We are pleased to announce that Chaordic Solutions has now partnered with now OCAI-Online to make the Organizational Culture Assessment Instrument (OCAI) available to our clients … a hassle-free, online based tool for diagnosing and helping to manage organizational culture.

Completing Values Framework

OCAI is a validated instrument, used by over 10,000 companies worldwide.  It is based on based on the highly respected work of Professors Robert Quinn and Kim Cameron, who are responsible for developing the Competing Values Framework.

Using an analysis of thirty-nine indicators for organizational effectiveness, Cameron and Quinn discovered two important dimensions within their data.  From further analysis, they were able to identify four quadrants that corresponded with the four organizational culture types that they had found that differed strongly along these two dimensions … what they subsequently referred to as the Competing Values Framework:

 

 

Internal focus and integration VS External focus and differentiation

 

Stability and control VS Flexibility and discretion

 

 

 

 

To the left in the graph, the organization is internally focused: what is important for us, and how do we want to work? However, to the right the organization is externally focused: what is important for the outside world, the clients, and the market?

At the top of the graph, the organization desires flexibility and discretion, while at the bottom the organization values the opposite: stability and control.

Different Types of Culture

 

Every organization has its own mix of these four types of organizational cultures. This mix is found by the completion of a short questionnaire. This assessment is a valid method to examine organisational culture and the desire for change.

 

 

Successful organizational change is all about changing “the way we do things around here”: what you need is actual behavior change.  Working with your workplace culture is an excellent way to create this kind of real change.  The OCAI tool is a great starting point followed by engaging OCAI workshops that entice people to co-create their culture and take ownership for the change.

Importance of Culture

For over 25 years we have been helping senior executives to cope with complex organizational change.  Over this period, we have recognised the increasingly important role that culture plays in providing a foundation for success.  Our recent research into the barriers to implementing an integrated approach to governance, risk and compliance (GRC) has provided tangible evidence to support this view.

In conjunction with our ongoing consulting activities, we are now researching this area in more depth as part of our doctorate research activities into how the culture of an organisation can be influenced to make it more receptive to enterprise-wide initiatives such as compliance as well as GRC itself.

Our use of the OCAI-Online tool is a key part of our consulting and research activities.

Next Steps

We believe the OCAI provides a very useful and powerful starting point for sustainable, successful organizational change.  If you take the time for a serious dialogue about the outcome, you will achieve breakthrough results later on in the process.

Contact Robert J Toogood via email or on +44 (0)1983 617241 to find out more about how you and your organisation can benefit from using this exciting tool.

IRM GRC SIG session on 13 September discussing ethical aspects of corporate governance regulation and guidance - http://www.chaordicsolutions.co.uk/blog/irm-grc-special-interest-group/irm-grc-sig-session-on-13-september-discussing-ethical-aspects-of-corporate-governance-regulation-and-guidance/

http://www.chaordicsolutions.co.uk/blog/irm-grc-special-interest-group/irm-grc-sig-session-on-13-september-discussing-ethical-aspects-of-corporate-governance-regulation-and-guidance/

You can now book your place for the next IRM GRC SIG Keep-in-Touch call on 13 September at https://irmgrcsigseptember.eventbrite.co.uk

The purpose of this month’s informal Keep-in-Touch session is to review and discuss feedback on the recently published report entitled “Review of the Ethical Aspects of Corporate Governance Regulation and Guidance in the EU”, available for download from this location:

http://www.ibe.org.uk/userfiles/op8_corpgovineu.pdf

The report is being shared as it relates to some of our recent SIG discussions about the importance of governance/leadership in supporting an effective orchestration/integration of governance, risk and compliance within an organisation.

More … http://theirm.org/events/GRC_SIG.htm

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More information from original FERMA email press release:

Questions of ethics, or the ‘right way to run a business’, are inherent in all aspects of corporate governance, including the way the board conducts itself. Ethical choices are relevant to the business strategies that boards pursue and the way that they direct and structure the business to achieve them.

A new report, A Review of the Ethical Aspects of Corporate Governance Regulation and Guidance in the EU published today by the Institute of Business Ethics, in association with ecoDa, the European Directors’ Association, examines corporate governance policy debates and frameworks.

Its findings draw attention to a notable lack of explicit reference to ethical imperatives, and so raise questions about why this is the case, whether this should be addressed and how.

This Occasional Paper explores the extent to which, in legislation, frameworks and codes for corporate governance across the EU and within its member states, there are explicit statements or requirements for business to be governed in line with ethical principles or commitments.

Julia Casson, author of the report, said: “We began this report wanting to understand whether there was guidance for companies in governance policies, at national and EU level, on ethical business practice. Although we did find similarities in corporate governance requirements around practice and certain issues, there seems to be a general lack of ethical language in corporate governance provisions. This is in spite of the fact that boards are expected to set the values which will guide their company’s operations.”

For some key governance issues that boards have been expected to address, the explicit driver is most often given in terms of what is ‘good for business’ rather than engagement with any moral imperative. This is the case even though what is generally viewed as unethical behaviour, including at the most senior levels, has led to business failure on numerous occasions. The link has yet to be explicitly made in corporate governance discourse that what is ethical is very often good for business, or at least that what is unethical generally impacts negatively on business.

At the member state level, the beginnings of a greater focus on board behaviour and conduct can be seen, especially in guidance for directors.

Some governance codes contain ‘various rules of conduct’ ( i.e. commitment, leadership, discretion, independent judgment, integrity, acting in the corporate interest and acting in the interests of stakeholders) and refer to behaviours required by boards.

Patrick Zurstrassen, Chairman of ecoDa said: “The purpose of governance can be said to be to encourage companies to make robust decisions, manage risk properly and account to those that provide their capital. To complete this approach, it is essential to get individual board members with a great sense of ethics and a collective mindset in line with the company’s values”

Philippa Foster Back OBE, Director of the IBE said: “Attention to ethics is increasingly a core feature of boardroom agendas. Many companies recognise business ethics, sustainability and social responsibility, and also boardroom ethics, as characterising the right way to run a business as well as being essential for long term success. This is in spite of the apparent lack of explicit engagement at EU level with ethical principles in corporate governance guidance, and the limited requirement, or indeed encouragement, that boards operate with high ethical standards,.”

More … http://www.ibe.org.uk/index.asp?upid=52&msid=8

Using ambiguity, complexity and effective communication to stop organisational meltdown - http://www.chaordicsolutions.co.uk/blog/from-our-change-management-consultants/using-ambiguity-complexity-and-effective-communication-to-stop-organisational-meltdown/

http://www.chaordicsolutions.co.uk/blog/from-our-change-management-consultants/using-ambiguity-complexity-and-effective-communication-to-stop-organisational-meltdown/

Using ambiguity, complexity and effective communication to stop organisational meltdown: introducing the Helix of Change™.

 

From Robert J Toogood, Senior Partner – Chaordic Solutions:

When the world changes faster than people are able to adapt to it then this is when something called chaotic change can take over … and if left unmanaged, can result in organisational meltdown and ultimately, failure.  However, whilst this form of chaos brings uneasiness, it can also be used as a powerful catalyst for creativity and growth.

Introducing the Helix of Change™

Several years ago, we started to research one aspect of how change occurs within nature and how this relates to what happens in organisations.

You may already know that at the very centre of growth within the natural world is something called the Helix of Life aka DNA.   The Helix of Life is a complicated structure … consisting of two long chains of molecular building blocks called nucleotides, twisted into a double helix and joined by things called hydrogen bonds.

If we use this analogy for describing chaotic change then our view is that one long chain of the double helix could represent ambiguity and the other complexity, with effective communication as the equivalent of the hydrogen bonds that keep the structure together.  We referred to this at the time as the Helix of Change™.

In the natural world, when allowed to operate healthily, all is well and the life form is able to survive.  However, if the hydrogen bonds fail or get damaged, the organism dies.

So it is in organisations … effective communication is essential for our survival and if this fails, then ambiguity and complexity get out of control resulting in chaotic change which if left unmanaged, can result in organisational meltdown and ultimately, failure.

The American writer Henry Adams (1838-1918) once said that “Chaos often breeds life, when order breeds habit”.  So for some time now, a degree of chaos within an organisation has been recognised as potentially healthy and possibly, even desirable.

Indeed, chaos can sometimes develop as a result of management’s own attempts to use creative tension within the organisation to create a shared vision as advocated many years ago by Peter Senge in The Fifth Discipline.  “A shared vision provides a compass to keep learning on course when stress develops”, Senge says.  In addition, “The gap between vision and current reality is also a source of energy.  If there were no gap, there would be no need for any action to move towards the vision”.  The gap created is referred to creative tension and it is this, which can create a degree of positive chaos on a temporary basis whilst order is being restored and directed towards achieving the shared vision.

Over the coming months, we will share our active research activities into this relationship between ambiguity, complexity and effective communication …. and organisational culture; our specific focus is exploring how they can be used to positively influence critical activities like governance, risk and compliance … by winning those “hearts and minds” that are so important for making sure the right things happen, at the right time and in the right place!

Contradicting views on future of corporate culture - http://www.chaordicsolutions.co.uk/blog/from-our-change-management-consultants/contradicting-views-on-future-of-corporate-culture/

http://www.chaordicsolutions.co.uk/blog/from-our-change-management-consultants/contradicting-views-on-future-of-corporate-culture/

Contradicting views on future of corporate culture: functionally driven variations vs consistent corporate-wide.

 

Extract from strategy+business – Paul Michelman:

I’ve seen two strong theories about the future of corporate culture recently. Both are compelling, and each comes to a very different conclusion. In other words, we have all the ingredients for a debate.

The first argument: Many variations of culture should exist within an organization.

Of all the topics you might expect Eric Ries to riff on, corporate culture does not immediately spring to mind. Ries is the author of The Lean Startup and an expert on entrepreneurship and product development. As he argues it, the link between innovation and culture is hard to ignore. If companies—particularly large and mature ones—expect to adopt the sustainable approaches to innovation that Ries believes are critical to their survival, they need to forget about having a consistent set of norms across the full enterprise. Instead, they need strong cultures for their various professional functions.

Ries’s argument about culture derives from his larger belief that different functions in the organization require different forms of management. The part of the organization that develops new products and launches new lines of business, for example, should not be held to the same set of standards as units that manage mature and stable lines. The same should be true of their cultures.

According to Ries, a healthy innovation-focused culture will …

More: http://www.strategy-business.com/blog/Corporate-Culture-Is-Dea-Long-Live-Corporate-Culture?gko=46810

©2013 Booz & Company Inc. All rights reserved.

Importance of risk management in restoring post-crash confidence - http://www.chaordicsolutions.co.uk/blog/from-our-risk-management-consultants/importance-of-risk-management-in-restoring-post-crash-confidence/

http://www.chaordicsolutions.co.uk/blog/from-our-risk-management-consultants/importance-of-risk-management-in-restoring-post-crash-confidence/

Importance of risk management in restoring post-crash confidence: some progress made but more work still needed.

 

Extract from Economist Intelligence Unit – Management Thinking:

To assess the progress and shortcomings of financial institutions in meeting new regulatory requirements the Economist Intelligence Unit polled 350 senior-level executives at financial services firms in March 2013.  The survey, sponsored by Protiviti posed questions about their firms risk management defenses before and after the crisis.  Most respondents hailed from Western Europe and North America, with the bulk of the remainder in the Asia-Pacific and Eastern Europe.  Those polled represent the main financial industry sub-sectors, with about half in banking, nearly one quarter in insurance and the balance in capital markets and private investment funds.  The survey finds that just a small minority of respondents rate their risk management systems as fundamentally sound over the crisis.  Yet increased regulatory pressure ranks as their greatest risk management priority.   Survey results also single out actions taken since the crisis to shore up risk management defenses, and obstacles that impede such efforts, including resource shortages.  But, respondents noted, compliance brings many benefits including better operational efficiency and customer assurance.

You can download the full report here.

More: http://www.managementthinking.eiu.com/restoring-confidence.html

Don"t forget to implement your new strategy - http://www.chaordicsolutions.co.uk/blog/from-our-strategy-implementation-consultants/dont-forget-to-implement-your-new-strategy/

http://www.chaordicsolutions.co.uk/blog/from-our-strategy-implementation-consultants/dont-forget-to-implement-your-new-strategy/

Don’t forget to implement your new strategy: become more focused on implementation by creating culture of execution.

 

Extract from Knowledge@Wharton:

When it comes to executing strategy, the old saying “the devil is in the details” holds true for many companies, according to Wharton emeritus management professor Lawrence G. Hrebiniak.  While executives may readily participate in the development of new strategies, execution tends to get short shrift, because it is often viewed as a lower-level task or concern, he notes.  In the following interview, Hrebiniak — who just published the second edition of his book, Making Strategy Work: Leading Effective Execution and Change — explains why it’s critical for firms to create a “culture of execution” in order to succeed.

An edited version of the conversation appears below ….

More … http://knowledge.wharton.upenn.edu/article.cfm?articleid=3316

All materials copyright of the Wharton School of the University of Pennsylvania

44% strategic initiatives over last 3 years were not successful - http://www.chaordicsolutions.co.uk/blog/from-our-strategy-implementation-consultants/44-strategic-initiatives-over-last-3-years-were-not-successful/

http://www.chaordicsolutions.co.uk/blog/from-our-strategy-implementation-consultants/44-strategic-initiatives-over-last-3-years-were-not-successful/

44% strategic initiatives over last 3 years were not successful: PMOs play key role for implementation success.

 

Extract from PMI PMO Thought Leadership:

Its title, tasks and structure tends to vary, but its role is increasingly important and clear: the PMO is the engine that gets things done in organizations.  Widely known as a home for best practices and implementation of project and program management, today’s PMO has a key role in strategic success.

PMI is looking in-depth at PMOs as enablers of organizational change, logically suited to convert the energy of ideas into the currency of competitive advantage.

Why good strategies fail: Lessons for the C-suite is a report from the Economist Intelligence Unit, sponsored by PMI.

Senior executives recognize that strategy implementation is essential to competitiveness, but a majority admits to poor performance in this area.  Unfortunately, many executives ignore the problem.  Our report uncovers a range of steps to successfully manage this situation.  It examines the spectrum of opportunities connecting strategy to implementation, including the establishment of PMOs and other enablers of change and success.

© 2013 The Economist Intelligence Unit Ltd.

More … http://www.pmi.org/Knowledge-Center/PMO-Thought-Leadership.aspx

Reputational risk is most challenging category of risk to manage - http://www.chaordicsolutions.co.uk/blog/from-our-risk-management-consultants/reputational-risk-is-most-challenging-category-of-risk-to-manage/

http://www.chaordicsolutions.co.uk/blog/from-our-risk-management-consultants/reputational-risk-is-most-challenging-category-of-risk-to-manage/

Reputational risk is most challenging category of risk to manage: top ten tips for managing them.

 

Extract from ACE European Group Press Release:

92% of companies believe that reputational risk is the most challenging category of risk to manage, according to a major new study from ACE Group conducted across 15 countries within its EMEA (Europe, Middle East and Africa) region.

ACE’s report, ‘Reputation at Risk’, published today, is the latest in its series of EMEA Risk Briefings examining new and emerging risks. It reveals that while 81% of companies in the survey see reputation as their most significant asset, most of them admit that they struggle to protect it and identifies a number of key reasons why companies in the region often find reputational risk challenging to manage:

- 77% of companies find it difficult to quantify the financial impact of reputational risk on their business, making it harder to measure than traditional, more tangible risks.

- 68% of companies believe information and advice about how to manage reputational risk is hard to find, compounding the sense of uncertainty and confusion about how best to manage it.

- 66% of companies feel inadequately covered for reputational risk from an insurance perspective.

- 56% of companies say social media has greatly exacerbated the potential for reputational risk to affect their business.

The report also proposes a number of solutions to adopt, including:

- Companies need a clear framework for managing reputational risk. Effective management of ‘traditional risks’ will help avoid reputational events, and management teams need to put in place a culture and instil a risk appetite across the company that will reduce the potential for crises to emerge in the first place. In addition, taking a multi-disciplinary approach that involves the CEO, PR specialists and other business leaders will also help to build the broader perspective that is necessary for identifying and managing less obvious reputational risks.

- Companies should work harder at measuring how their reputation is perceived. Understanding perceptions of key stakeholders, their interplay and their impact on corporate reputation, is essential for tracking and managing reputational risk effectively. Companies must ensure that they are collecting an “outside-in” perspective to complement their own internal perspective.

- Companies should sharpen up their crisis management plans to keep pace with today’s faster-moving world. Our research suggests that many companies may be over-confident in their abilities to respond to a crisis. Regular review and testing – including the incorporation of social media scenarios – will allow a faster response when disaster strikes.

- The insurance market can do more to help companies manage reputational risk. This includes the provision of more holistic solutions that include crisis response assistance. It also includes helping companies to take a ‘reputational lens’ to more traditional risks to evaluate the reputational consequences in each case.

Andrew Kendrick, President, ACE European Group, said:

“Reputational risk can be difficult to predict. However, some clear pointers emerge from our research as to the source of companies’ key worries. One of these is the globalisation of business, with complex supply chains, expansion into new markets and the challenge of maintaining consistent standards across multiple borders all giving cause for concern. The other noticeable theme is regulation. Post-crisis, compliance has taken on a new importance and businesses of all shapes and sizes are more keenly aware of its relationship to their corporate reputation.

“Insurance is not a panacea for the fast-evolving world of reputational risk. Nevertheless, I believe there is much that insurers and brokers can do collectively to help their clients. This includes the evolution of new more holistic insurance solutions that involve the input of crisis and PR specialists. More generally, professional risk engineering can help to improve risk management processes and governance, allowing clients to manage the more ‘traditional risks’ better and reducing the likelihood of a reputational event in the first place.”

To view the full report ‘Reputation at Risk’ along with ‘top ten tips’ for managing reputational risk, please visit www.acegroup.com/eu

More … http://www.acegroup.com/eu-en/media-centre/details.aspx?article=/eu-en/Home/Assets/news/20130723005710en.html

Lack of ethical imperatives across EU and member states - http://www.chaordicsolutions.co.uk/blog/from-our-governance-consultants/lack-of-ethical-imperatives-across-eu-and-member-states/

http://www.chaordicsolutions.co.uk/blog/from-our-governance-consultants/lack-of-ethical-imperatives-across-eu-and-member-states/

Lack of ethical imperatives across EU and member states: Corporate Governance legislation should include more ethics.

 

Extract from recent Institute of Business Ethics Press Release:

Questions of ethics, or the ‘right way to run a business’, are inherent in all aspects of corporate governance, including the way the board conducts itself.  Ethical choices are relevant to the business strategies that boards pursue and the way that they direct and structure the business to achieve them.

A new report – A Review of the Ethical Aspects of Corporate Governance Regulation and Guidance in the EU recently published by the Institute of Business Ethics, in association with ecoDa, the European Directors’ Association, examines corporate governance policy debates and frameworks.  Its findings draw attention to a notable lack of explicit reference to ethical imperatives, and so raise questions about why this is the case, whether this should be addressed and how.

This Occasional Paper explores the extent to which, in legislation, frameworks and codes for corporate governance across the EU and within its member states, there are explicit statements or requirements for business to be governed in line with ethical principles or commitments.

Julia Casson, author of the report, said: “We began this report wanting to understand whether there was guidance for companies in governance policies, at national and EU level, on ethical business practice.  Although we did find similarities in corporate governance requirements around practice and certain issues, there seems to be a general lack of ethical language in corporate governance provisions.  This is in spite of the fact that boards are expected to set the values which will guide their company’s operations.”

For some key governance issues that boards have been expected to address, the explicit driver is most often given in terms of what is ‘good for business’ rather than engagement with any moral imperative.  This is the case even though what is generally viewed as unethical behaviour, including at the most senior levels, has led to business failure on numerous occasions.  The link has yet to be explicitly made in corporate governance discourse that what is ethical is very often good for business, or at least that what is unethical generally impacts negatively on business.

At the member state level, the beginnings of a greater focus on board behaviour and conduct can be seen, especially in guidance for directors.  Some governance codes contain ‘various rules of conduct’

( i.e. commitment, leadership, discretion, independent judgment, integrity, acting in the corporate interest and acting in the interests of stakeholders) and refer to behaviours required by boards.

Patrick Zurstrassen, Chairman of ecoDa said: “The purpose of governance can be said to be to encourage companies to make robust decisions, manage risk properly and account to those that provide their capital.  To complete this approach, it is essential to get individual board members with a great sense of ethics and a collective mindset in line with the company’s values”

Philippa Foster Back OBE, Director of the IBE said: “Attention to ethics is increasingly a core feature of boardroom agendas.  Many companies recognise business ethics, sustainability and social responsibility, and also boardroom ethics, as characterising the right way to run a business as well as being essential for long term success.  This is in spite of the apparent lack of explicit engagement at EU level with ethical principles in corporate governance guidance, and the limited requirement, or indeed encouragement, that boards operate with high ethical standards,.”

For further information, contact Philippa Foster Back, IBE Director: +44 (0)20 7798 6040  info@ibe.org.uk

More … http://ibe.org.uk/userfiles/pressreleases/corpgovineu.pdf

 

Recent research identified five success factors for PPM effectiveness - http://www.chaordicsolutions.co.uk/blog/from-our-portfolio-management-consultants/recent-research-identified-five-success-factors-for-ppm-effectiveness/

http://www.chaordicsolutions.co.uk/blog/from-our-portfolio-management-consultants/recent-research-identified-five-success-factors-for-ppm-effectiveness/

Recent research identified five factors for PPM effectiveness: can be used in any organisation to increase success.

 

From Robert J Toogood, Senior Partner – Chaordic Solutions:

Recent research from project management researcher-practitioners at Pennsylvania State University and the Stevens Institute of Technology … Dr Peerasit Patanakul, Dr Audrey Curtis, and Brian Koppel, MBA PMP, has identified five factors that contribute to Project Portfolio Management (PPM) effectiveness.  These factors are:

1. Formal strategic planning and capital budgeting;

2. Organisational entities responsible for project and portfolio management, and their organisational placement;

3. Frameworks and processes for project portfolio management and information systems support;

4. Organisational culture;

5. Committed, active and competent participants.

These success factors were identified following detailed research conducted inside five different organisations in which they were given unique, privileged access to detailed project documentation and key stakeholders.  This enabled them to create a evidence based definition of project portfolio management effectiveness that can be applied to any organisation.

More … http://www.pmi.org/en/Knowledge-Center/Research-Completed-Research/Effectiveness-in-Project-Portfolio-Management.aspx

Research confirms value of creating risk-aware and open communication culture - http://www.chaordicsolutions.co.uk/blog/from-our-change-management-consultants/research-confirms-value-of-creating-risk-aware-and-open-communication-culture/

http://www.chaordicsolutions.co.uk/blog/from-our-change-management-consultants/research-confirms-value-of-creating-risk-aware-and-open-communication-culture/

Research confirms value of creating risk-aware and open communication culture: risk function just guides and educates.

 

Extract from airmic News:

Research finds that resilient firms are those that eliminate internal barriers. Resilient companies do not depend solely on processes or compliance; they create an environment where everyone is risk-aware and barriers between senior managers and their staff are reduced to a minimum. That is one of the main findings of ‘Roads to Resilience’, a report being produced by Cranfield Business School on behalf of Airmic.

Researchers investigated eight firms that have either managed to ride crises successfully or have avoided them altogether. Just as Darwin discovered that the most adaptable, not necessarily the strongest species survive, ‘Roads to Resilience’ found that the most durable firms are those that can respond rapidly and effectively to changing circumstances.

In order to do so, businesses should create a culture where all staff are risk-aware and feel able to pass on their knowledge and views (even bad news!) to senior management. The role of the formal risk function is to guide and educate colleagues rather than to create a silo labelled ‘risk management’.

‘Roads to Resilience’ follows the highly acclaimed ‘Roads to Ruin’, which investigated the factors behind corporate failure. Published in 2011, the first research identified ‘risk glass ceilings’ as a recurrent problem, where vital information known elsewhere in the organisation never reached senior management or the board.

By contrast, ‘Roads to Resilience’ finds that the glass ceiling is absent in successful companies, and staff communicate easily with those at the top, acting as their radar. To achieve this, senior managers need to engage with their staff, earning respect by listening and experiencing what it is like to work in the company.

“At Jaguar Land Rover, senior executives spent half their time walking the shop floor, instead of sat in front of their computers in ivory tower offices. There has to be strong trust and people have to respect and be respectful of the people leading them,” said Dr Stephen Carver of Cranfield Business School.

To quote the chief operating officer of Virgin Atlantic: “The executives sit in open-plan offices, and we are not on the top floor – we just happen to be in one corner on the second floor. People know where we are, we immerse ourselves in the business, and they can come and talk to us.”

“The key message in this report is that culture enables resilience, and that culture comes from the top,” said Airmic chief executive John Hurrell. “Board members need to lead the way, not by lecturing their people but through example and connecting with them, by being approachable and willing to listen.

“It also represents a great opportunity for risk managers who, by virtue of their job, often have a broader knowledge of their companies than anyone else. They are ideally placed to facilitate the development of a corporate culture where everyone owns the risk management process.”

Airmic has published the main findings in an executive briefing ahead of the full report, which is due to come out in September. It is based mainly on interviews with executives at eight companies: American International Group(AIG); Drax Power Station; InterContinental Hotels Group; Jaguar Land Rover; Olympic Delivery Authority; The Technology Partnership; Virgin Atlantic, and Zurich.

The project is sponsored by Lockton, Crawford and PwC.

More … http://www.airmic.com/news-story/research-finds-resilient-firms-are-those-eliminate-internal-barriers?

© Airmic 2013

 

Value from redefining innovation for success - http://www.chaordicsolutions.co.uk/blog/from-our-business-transformation-consultants/value-from-redefining-innovation-for-success/

http://www.chaordicsolutions.co.uk/blog/from-our-business-transformation-consultants/value-from-redefining-innovation-for-success/

Value from redefining innovation for success: leveraging existing assets, competitive advantages and familiarity.

 

Extract from European Business Review – Patrick Barwise & Seán Meehan

Don’t be overawed by Apple – your company too can innovate beyond the familiar. This isn’t about “blue-sky thinking”, “blue ocean strategy” or pioneering completely new-to-the-world product categories: Apple doesn’t actually do that. It’s about being a user-focused fast follower and a relentless improver. Every company can successfully innovate beyond the familiar, although it does mean being willing to go beyond your comfort zone. We offer a general framework to help you do it.

More … http://www.europeanbusinessreview.com/?p=6409

© 2013 The European Business Review | All Rights Reserved.

Ten steps to help you survive and prosper from economic uncertainty - http://www.chaordicsolutions.co.uk/blog/from-our-portfolio-management-consultants/ten-steps-to-help-you-survive-and-prosper-from-current-economic-uncertainty/

http://www.chaordicsolutions.co.uk/blog/from-our-portfolio-management-consultants/ten-steps-to-help-you-survive-and-prosper-from-current-economic-uncertainty/

Ten steps to help you survive and prosper from economic uncertainty: using power of chaos for creativity and growth.

 

From Robert J Toogood, Senior Partner – Chaordic Solutions:

The world is changing faster than people are able to adapt to it … and if left unmanaged, this can result in organisational meltdown and ultimately, failure.

However, whilst this form of chaos brings uneasiness, it can also be used as a powerful catalyst for creativity and growth.

A few years ago, McKinsey published the results from a Global Survey into how companies make good decisions.  They highlighted several process steps that are strongly associated with good financial and operational outcomes.  In the survey, they asked executives from around the world about a specific capital or human-resources decision their companies made in the course of normal business.

The results emphasise the hard business benefits, such as increased profits and rapid implementation, of several decision-making disciplines – these include ensuring that people with the right skills and experience are included in decision making, making decisions based on transparent criteria and a robust fact base, and ensuring that the person who will be responsible for implementing a decision is involved in making that decision. Finally, although corporate politics sometimes seems to undermine strong decision making, some types of consensus-building and alliances apparently can help create good outcomes.

In the current economic climate, it is critical that organisations urgently review what they are doing and why they are doing it … to revalidate and review the relationship between their business strategy and tactical execution plans.  One approach that enables this to be easily achieved and meets the McKinsey criteria is a well-proven technique known as Project Portfolio Management (PPM). 

Using PPM you can re-prioritise the focus of your activities.  Obviously, this requires your business strategy to be current and up-to-date; if it is not, then this is a great opportunity to update it.  PPM enables you to maximise benefits from your project investments, because all activity is much more tightly aligned to your business strategy.  In doing this, the chaotic change associated with economic uncertainty can be brought back under control, by managing the inevitable ambiguity and complexity of the modern-day business environment with the use of effective communication.

Some projects may no longer be needed, so can be deferred or even cancelled.  However, other projects will still be needed to ensure the business can survive and emerge much more strongly from the dark months of economic uncertainty.  But none of this decision making should overlook the importance of compliance related activities that will still be needed and ideally already be embedded within the cultural veins of the organisation.

The following ten step check-list can be used to help you navigate through these challenging times and to refocus your activities for success. 

STEP 1:
Review and update your business strategy 

Is your strategy up-to-date and reflecting current business focus?  Make sure it is updated and owned by senior Management, and not by external consultants.  It should include tangible measures such as 10% more market share.  Use business investment not project related terminology.

STEP 2:
Communicate updated strategy and re-energise your business 

Does everyone know what they need to do within their own functional area to support your strategy and make it happen?  Ensure strong links between business strategy and tactical execution plans.  Rigorously and continually search out new value-adding opportunities for IT to add value to the business.

STEP 3:
Create inventory of your current projects and resources/capabilities 

What are all the different things you are working on and with what resources?  Make sure you include all resources associated with these projects including internal and external as well as chargeable and non-chargeable.

STEP 4:
Reconcile project inventory against your business strategy using selection criteria/priorities 

How do your current project activities relate to your updated business strategy, and in what way do they contribute towards this by adding value?  Be honest and ruthless.

STEP 5:
Make better tactical decisions using outcome from your reconciliation

Which of your projects should be cancelled, continued with, reintroduced or escalated?  Only proceed with projects that still add real value and enable the business to survive and grow.  Make sure the associated business cases are robust and well explained in terms that business ie non-IT people can understand.

STEP 6:
Prepare and implement your communication plan 

Does everyone know what you are now doing, and what is expected of them?  Use different approaches and media to ensure effective communication so that ambiguity and complexity are kept well under control.

STEP 7:
Enhance or set-up your Project Management Office (PMO)

How do you track the progress and activity of your projects?  Identify projects that need attention; see which projects have slowed down or haven’t had much work put into them. Are they still a priority? If not, reallocate resources and attention to more pressing needs.

STEP 8:
Refine your approach to project execution 

Do you build “collaborative capacity” through relationships, trust and knowledge exchange?  Intensify competition between internal teams.  Don’t cut back on meetings.  Meetings are more important than ever for brainstorming and firing up team members’ creativity.  Build new teams.  Business pull-backs are excellent times to pursue new ideas and projects and get them on the drawing board.  Don’t cut travel and insulate team members.  Get them out in the world and exposed to new thinking.  Encourage risk-taking.

STEP 9:
Embed PPM approach within your day-to-day business activities

Are you using PPM on a regular basis, and that resulting decisions/action are accurately focused on the real needs of your business?  If not, take steps to make sure PPM related processes are transparently integrated into day-to-day activities.

STEP 10:
Finally, keeps things in perspective! 

No matter what happens to the economy, there is going to be change, though it doesn’t have to be a traumatic process.  Most of these external changes are out of your control but we can always control our reaction and attitude to them.  Help your employees take ownership of their attitude and reaction to change.

If you would like to discuss any aspect of this topic in more detail or if you have any queries about what is needed … contact our Senior Partner, Robert J Toogood on +44 (0)1983 617241 or via email at robert_toogood@chaordicsolutions.co.uk to schedule a session, on a non-obligation and confidential basis.

More … http://www.chaordicsolutions.co.uk/services.html

 

Leadership models must change to reflect social nature of organisations - http://www.chaordicsolutions.co.uk/blog/from-our-business-transformation-consultants/leadership-models-must-change-to-reflect-social-nature-of-organisations/

http://www.chaordicsolutions.co.uk/blog/from-our-business-transformation-consultants/leadership-models-must-change-to-reflect-social-nature-of-organisations/

Leadership models must change to reflect social nature of organisations: people often disengaged, disenfranchised and distrusting.

 

Extract from Management Innovation eXchange - Dan Pontefract:

In 1973, Peter Drucker stated in his book Management: Tasks, Responsibilities, Practices, “Management is not culture-free, that is, part of the world of nature. It is a social function. It is, therefore, both socially accountable and culturally embedded.”

Tom Peters some thirteen years later in an article, Managing As Symbolic Action, remarked: “It requires us, as managers, to get people to share our sense of urgency in new priorities; to develop personal, soul-deep animus toward things as they are; to get up the nerve and energy to take on the forces of inertia that bog down any significant change program.”

Yet, here we are in 2013 with organizational leadership models that continue to deny the social nature of organizations and wallow in inertia.

Our leadership practices remain authoritative. People are disengaged, distrusting and perhaps even disenfranchised.

According to the 2013 Edelman Trust Barometer, less than 20 percent of respondents believe leaders are actually telling the truth when confronted with a difficult issue in their organizations. Furthermore, a study conducted by the Human Capital Institute and Interaction Associates in 2013 found only 34 percent of organizations had high levels of trust in the places they work. Furthermore, a paltry 38 percent reported their organizations had effective leadership running the show.

To cap off a small sliver of dismal data points, research firm Gallup found that over a twelve-year period between 2000 and 2012 the percentage of engaged employees in the workforce has shifted between 26 percent and 30 percent. That is, roughly 70 percent of employees in today’s organizations have spent more than a decade essentially collecting a pay check, an almost Shakespearean spectacle of tragic ambivalence.

What if our approach to leadership was to evolve into Drucker’s vision of “socially accountable and culturally embedded” management?

Cam Crosbie is the CIO of Equitable Life Insurance Company of Canada, represented by more than 10,000 independent producers across Canada and Bermuda. Cam completely understands the need to “lead without authority.” He does so, quite simply, by asking questions rather than barking orders. Before moving forward with a big decision or a large project, Cam makes a practice of asking lots of questions, including, as he says, “even the so called ‘dumb ones’”.

As a CIO, Cam believes it’s important to reach out to others and inquire before pushing ahead. Cam said, “I hope that in some small way if people see the CIO unashamedly asking the simple questions, it clears the way for clearer and more meaningful discussion.” Perhaps the first step toward a better future for your organization is to acknowledge that you don’t necessarily know the way there—and, just as important, to understand that by asking questions, you not only awaken and engage people, you stand to collect more valuable perspective and ideas than you would by starting from a position of authority.

Leadership isn’t a 9-5 job—it’s communal, it’s holistic and it’s accretive. It’s time to abandon the long-held notion that the “leader” knows all and should decide everything. A fancy title doesn’t put you above others—it puts you in their service.

TELUS, a national telecommunications company in Canada, with $11 billion of annual revenue and over 40,000 employees worldwide (and where I am head of learning and collaboration), has worked incredibly hard over the past five years to raise employee engagement from 53 percent to 80 percent. It did so through myriad actions including the launch of the TELUS Leadership Philosophy. The TLP is an enterprise-wide leadership framework that cultivates a collaborative, social, open and engaging mindset among all employees regardless of rank or title. It encourages all employees to “engage and explore” with one another before “executing.” It defines key behavioral attributes such as communicating, collaborating, learning, deciding and adapting such that everyone can speak the same leadership language.

In mid-2010, an internal program was born at TELUS entitled Customers First. The overarching goal of the program was to improve the likelihood that  TELUS customers would recommend the company. As the program began to gain traction, another idea surfaced: Customer Commitments. Think of the commitments as customer promises—specific actions that any TELUS team member would carry out to help a customer regardless of role.

Instead of locking its most senior executives in a room to decide what the Customer Commitments were going to be for the organization, we designed a collaborative process that involved the entire organization. Over 1,000 different examples surfaced over a two-month period. Through focus groups, interactive online polling and voting, the 1,000 were whittled down to a final four.

If the culture at TELUS was one that relied on authoritative leadership, the Customer Commitments would have been created in a couple of hours by a few authoritative leaders. Because the culture was healthy, open and participative as opposed to dogmatic and ruthlessly hierarchical, the organization collaborated without authority. This is the work of leadership today: asking questions, involving people, connecting them to each other, creating a platform for their insights and ideas to make a real impact—in other words, unleashing leadership behavior everywhere.

In this moment of reflection, as we seek to redefine the work of leadership, let us remember the words of  Nelson Mandela:

“[Ubuntu is] the profound sense that we are human only through the humanity of others; that if we are to accomplish anything in this world it will in equal measure be due to the work and achievements of others.”

If you’re lonely at the top, it’s time to start recognizing and amplifying the contribution of those around you.

Dan Pontefract is the author of Flat Army: Creating a Connected and Engaged Organization and is the Head of Learning and Collaboration at TELUS.

More … http://www.managementexchange.com/blog/rethinking-work-leadership?

This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License.

 

Using wisdom networks to achieve rapid jump in productivity and growth - http://www.chaordicsolutions.co.uk/blog/from-our-business-transformation-consultants/using-wisdom-networks-to-achieve-rapid-jump-in-productivity-and-growth/

http://www.chaordicsolutions.co.uk/blog/from-our-business-transformation-consultants/using-wisdom-networks-to-achieve-rapid-jump-in-productivity-and-growth/

Using wisdom networks to achieve rapid jump in productivity and growth: leveraging wisdom and effort of crowds.

 

Extract from Management Innovation eXchange – Marcus Cake:

Facebook reduced social interaction to books of “things” that could shared with anyone, everywhere and restructured global social time and attention and achieved global transparency and meritocracy in less than 10 years. Wisdom Networks are an open source platform that defines things, books, process and outcomes for complex communities and can be deployed within 90-180 days. Wisdom Networks will reduce organisations, industries and society to books that can be shared with anyone, everywhere, anytime and transform the remainder of society within 2-5 years. The change in person to person communication crowd creates the next stage of economic development – distributed prosperity. 

A Wisdom Network is an “Over the Top” platform that organises the wisdom and effort of crowds across the organisation, industry and society. Wisdom Networks leverages the Internet of Everything (IoE) by linking “things” to reveal knowledge, sharing books of things to share knowledge and organising action toward optimal outcomes. Any complex communities can be reduced to six types of “things” and a few simple interactions which can be managed by wisdom networks.

 

More … http://www.managementexchange.com/hack/wisdom-networks-crowd-create-leadership-productivity-growth-everywhere

This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License.

Time to view uncertainty and change as opportunities not threats - http://www.chaordicsolutions.co.uk/blog/from-our-change-management-consultants/time-to-view-uncertainty-and-change-as-opportunities-not-threats/

http://www.chaordicsolutions.co.uk/blog/from-our-change-management-consultants/time-to-view-uncertainty-and-change-as-opportunities-not-threats/

Time to view uncertainty and change as opportunities not threats: leverage future uncertainty by embracing risk.

 

From Robert J Toogood, Senior Partner – Chaordic Solutions:

Change management remains an integral part of what is needed to achieve successful business transformation … but without addressing the softer, people related aspects/challenges experience shows it is not possible to bring about long lasting alignment changes. 

But change management needn’t be complicated.  Sometimes, the most startling effects can be achieved by going back to basics and reminding ourselves of what we are really trying to achieve, before getting all tangled-up with methodologies and models.

Our real-life experience shows that one of the softer issues/challenges often associated with change is uncertainty … this generates lack of business confidence, which limits investment made in innovation and therefore growth, which in turn creates weaker economic conditions that then potentially threaten us with recession if not addressed.

So uncertainty – what is it and should we fear it, or have we naively believed in the past that we could control the future?  Uncertainty generates lack of business confidence, which limits investment made in innovation and therefore growth … which in turn creates weaker economic conditions that then threatens us with recession.

Over the last few years the majority of us have clearly been taken by surprise – events have occurred locally and globally that we did not predict.  These unexpected, rare events are described as Black Swans by Nassim Nicholas Taleb in “The Black Swan: The Impact of the Highly Improbable” and specifically as “a highly improbable event with three principal characteristics: It is unpredictable; it carries a massive impact; and, after the fact, we concoct an explanation that makes it appear less random, and more predictable, than it was”.  For years, Taleb has studied how we fool ourselves into thinking we know more than we actually do.  “We restrict our thinking to the irrelevant and inconsequential, while large events continue to surprise us and shape our world.”

So we need to change the way we think and therefore view things like uncertainty and change.  As Dr David Hillson says in his book “Exploiting Future Uncertainty: Creating Value from Risk”, “whatever the future holds, one thing is sure: nothing is certain except uncertainty.  Prediction is always hard, especially about the future, but the biggest risk is not taking any risk at all.  All businesses face significant levels of uncertainty these days.  To succeed you need to exploit future uncertainty, turning it to your advantage by managing risk effectively”.

We can help you to leverage these opportunities by embracing this uncertainty … book a free, introductory consultation call to discuss your immediate challenges on a non-obligation and confidential basis – simply call us on +44 (0)1983 617241 to set something up.

More … http://www.chaordicsolutions.co.uk/services.html

IRM GRC SIG event on 25 July has implementation barrier focus - http://www.chaordicsolutions.co.uk/blog/irm-grc-special-interest-group/irm-sig-event-on-25-july-has-implementation-barriers-focus/

http://www.chaordicsolutions.co.uk/blog/irm-grc-special-interest-group/irm-sig-event-on-25-july-has-implementation-barriers-focus/

You can now book your place for the next IRM GRC SIG event on 25 July at http://irmgrcsigjuly13.eventbrite.co.uk

 

The main focus of this session is to reflect on what we have discovered so far, and to discuss in more detail what we now think the barriers are to implementing a more coordinated approach to GRC.

IMPORTANT: as this session is being kindly hosted in the new Canary Wharf offices of Shell, it is essential for security reasons that if you intend to attend the event in person that you book your place by no later than 17:00 UK time on Monday, 22 July 2013: http://irmgrcsigjuly13.eventbrite.co.uk; the deadline for booking virtual tickets (for participation by Audio and WebLink) is 48 hours later at 17.00 UK time on Wednesday.

I sincerely hope you can participate in the session, either in person or virtually. In the meantime, if you have any queries or questions about this event or any other aspect of our SIG activities then do not hesitate to contact me.

Best Wishes, Robert
Chair, IRM GRC SIG

Email: robert_toogood@chaordicsolutions.co.uk

NEWSFLASH: Our Senior Partner, Robert J Toogood, just been awarded MSc in Risk Management (Distinction) - http://www.chaordicsolutions.co.uk/blog/news/newsflash-our-senior-partner-robert-j-toogood-just-been-awarded-msc-in-risk-management-distinction/

http://www.chaordicsolutions.co.uk/blog/news/newsflash-our-senior-partner-robert-j-toogood-just-been-awarded-msc-in-risk-management-distinction/

NEWSFLASH: Our Senior Partner, Robert J Toogood, has just been awarded a MSc in Risk Management (Distinction), fantastic independent endorsement of his significant real-life experience/expertise gained over twenty-five years in the areas of governance, risk management and compliance … visit his companion site to see how he can help you overcome your current challenges.

More … www.robertjtoogood.com - currently optimised for normal laptop/desktop viewing, but will be made more mobile-friendly over the coming months.

 

Importance of people-orientated approach for managing M&A change - http://www.chaordicsolutions.co.uk/blog/from-our-ma-consultants/importance-of-people-orientated-approach-for-managing-ma-change/

http://www.chaordicsolutions.co.uk/blog/from-our-ma-consultants/importance-of-people-orientated-approach-for-managing-ma-change/

Importance of people-orientated approach for managing M&A change: culture and communication must be priority actions.

 

From Robert J Toogood, Senior Partner – Chaordic Solutions:

As we have heard many times recently, revenue and growth is very important for our future survival … this can be achieved in a variety of different ways.   One such way is to embark upon a Business Transformation programme, another is to merge with or acquire a complementary or even a competitor company.

A recent survey report from Deloitte shows how mergers and acquisitions (M&A) can help drive revenue and growth … in this report, the view is shared that as the economic recovery continues, albeit slowly, they expect companies in many industries to rely increasingly on M&A to help drive revenue growth and bottom-line performance.  Survey results show that 52% of executives interviewed expect M&A to add more than 5% to revenue growth on a compound annual basis over the next two to five years.  This is significant when compared to average annual revenue growth of the S&P 500 of approximately 4% over the past 10 years.

The results from another survey, this one from McKinsey, show that in spite of the difficult economy, most executives still think M&A is an important strategy for growth.  In fact, nearly half of the respondents expect their companies to explore more deals in the next 12 months than the previous 12 months, and small majorities expect them to start or complete at least as many, if not more.

However, history shows that the majority of mergers and acquisitions fail to deliver the originally expected benefits and value.  So why is this so?  There have been many surveys and studies that have attempted to understand these underlying reasons; people related challenges tend to dominate the findings.  This therefore emphasises the importance of taking a more people-orientated approach to managing change within these situations, making sure things like culture and communication are properly addressed as priority actions.

We can help you address these challenges effectively so you can ensure you are one of the 20% of organisations that are able to succeed in delivering the original expectations for the deal … book a free, introductory consultation call to discuss your immediate challenges on a non-obligation and confidential basis – simply call us on +44 (0)1983 617241 to set something up.

More … http://www.chaordicsolutions.co.uk/services.html