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Decision Making

Decision Making

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Decision Making UBI Decision Making UBI Presentation Transcript

  • A 3 day seminar to rememberHow to MAKE GOOD DECISIONS and cope with related CHANGE? Roger Claessens, Prof. UBI www.rogerclaessens.be 1
  • DECISION MAKING & CHANGEI WANT YOU TO START WITH A WHITE PAGE……..BUT NOT A WHITE BRAIN ! 2
  • “ All great stories start with a white page ” Source: AUDI3
  • Decision making in the right environment A winning corporate culture!Leadership – Management & Change 4
  • Workshop topics: 1. Accountability 2. Leadership 3. Structured thinking 4. Intuitive thinking 5. Creating consensus 6. Communication Program 7. Implementation14,15 & 16/10/2011 8. Change management 9. Conflict & performance 10. Winning
  • Retrieving experience from : 1. The ENRON case 2. The Barings case 3. The subprime crisis case 4. The Too big to fail case 5. The desert case 6. The retail sale of investments case Program 7. The lean thinking approach 8. The future files statements14,15 & 16/10/2011 9. The SPIN approach 10. The Jack Welch approach
  • Could yourneighbour introduce YOU? 7
  • The introductory sentence of the workshopFailure is simply the opportunity to beginagain more intelligently. (Henri Ford) 8
  • OUR COMMON GOAL• At the end of the 3 days you should have your DECISION CHECKLIST for your future decisions 9
  • Part IConsequences, Accountability & Corporate Culture
  • 16 YEARS TO GO FROM 10bn TO 65bn &24 DAYS TO GO BANKRUPTENRON IS NOT ABOUT NUMBERS BUTABOUT PEOPLE _ IN REALITIY :A HUMAN TRAGEDY
  • Discussion • What were the CONSEQUENCES of the wrong decisions? • What would have been CORRECT decisions? 13
  • WHAT WENT WRONG? Senior management unloading stock? Substantial contributions to political parties Shredded documents Manipulating market risk Unusual high profits
  • WHAT WENT WRONG? Feeling of something unusual going on Falsified bank records Manipulation of earnings Trading beyond stated limits Unread reports Inappropriate use of legal loopholes
  • WHAT WENT WRONG? Booking potential profits at the moment of the conclusion of a contract Hypothetical future value accounting Performance evaluation system taken to the extreme
  • WHAT WENT WRONG? Profits without ethics Black box accounting « You have to do whatever you have to do t stay there! » Stock manipulation Abusive public relations
  • WHAT WENT WRONG? Convincing anyone else that they are smarter Unusual large profits & risk taking Abuse of deregulation Many un-answered questions
  • WHAT WENT WRONG? Pressure to do business at any price or abuse Corruption Perception = the reality Plenty of warning signs without control Conflict of interest – special purpose vehicles
  • WHAT WENT WRONG? Ambition versus modesty Demonstrated dangers of structured finance Lack of independance Using company stock to garantee own transactions GREED Sale – repurchase transactions (warehousing)
  • WHAT WENT WRONG? How is it that they reach the numbers? Traders run the company Absence of whistle blowing procedures DEADLY MISTAKE of ARTHUR ANDERSON = Death of the company itself
  • • « IT WAS ALL TO EASY… »
  • Recommended 23 reading
  • Discussion What have you learned from the ENRON case?
  • Discussion What would be appropriate tools to assure accountability?
  • 1. Management by objectives2. Code of conduct3. Performance evaluation4. Mission statements5. Internal and external communication6. Determine key values7. Determine behavioural norms8. Requires leadership 26
  • 1. Good decisions have taken consequences into account2. Good decisions entail clearly defined responsibilities3. Good decisions require the right corporate culture 27
  • Accountability is the concept in ethics andgovernance with several meanings. It is oftenused synonymously with such concepts asresponsibility, answerability, blameworthiness,liability, and other terms associated with theexpectation of account-giving.(Source: Wikipedia) 28
  • Corporate governanceCorporate governance is about:Assuring a correct management and control of a company, based on laws and rules and « behaviour » of management and staff!It implies duties such as:• An effective and efficient control• Solvency• Discipline of all involved
  • Corporate governanceThe ten (10) principles of corporate governance1. Required qualifications of the principal shareholders2. Adequate management structure3. Clear guidelines for powers and responsibilities4. Definition of individual tasks among management5. Independence of the control functions6. Required qualities of the managers7. Financial reward of the managers8. Strategic objectives, corporate values and avoidance of conflict of interest9. Corporate structures and products10. Publicity in publications
  • Corporate governance GovernanceAction Structure & Operations Control & Audit
  • Part 2 – Leadership
  • 33
  • Barings Bank (1762 to 1995) was the oldestmerchant bank in London until its collapse in1995 after one of the banks employees, NickLeeson, lost £827 million ($1.3 billion) due tospeculative investing, primarily in futurescontracts, at the banks Singapore office
  • Discussion • What were the CONSEQUENCES of the wrong decisions? • What would have been CORRECT decisions? 36
  • WHAT WENT WRONG? The MAJOR error is the lack of Chinese wall So superficial No “hands-on” management Control & audit Reporting No understanding
  • WHAT WENT WRONG? Feeling of something unusual going on Falsified bank records Manipulation of earnings Trading beyond stated limits Unread reports Inappropriate use of legal loopholes
  • WHAT WENT WRONG? Profits without ethics Black box accounting « You have to do whatever you have to do t stay there! » Stock manipulation Abusive public relations
  • WHAT WENT WRONG? Convincing anyone else that they are smarter Unusual large profits & risk taking Many un-answered questions
  • WHAT WENT WRONG? Pressure to do business at any price or abuse Corruption Perception = the reality Plenty of warning signs without control
  • WHAT WENT WRONG? Ambition versus modesty Demonstrated dangers of structured finance Lack of independance Using company stock to garantee own transactions GREED Sale – repurchase transactions (warehousing)
  • Discussion What have you learned from the BARINGS case?
  • CORPORATE CULTURE =SHARED VALUES & GROUP BEHAVIOURNORMS 44
  • ME incorporated =MY VALUES & MY NORMS 45
  • CORPORATE CULTURE = VISIBLE LEVEL (BRANDING) & SHARED VALUES46
  • A BRAND IS LINKED TO CULTURE “The culture of a group can be defined as:• a pattern of shared basic assumptions learned by a group as it solved its problems of external adaptation and internal integration,• which has worked well enough to be considered valid therefore, to be taught to new members as the correct way to perceive, think, and feel in relation to those problems” (Recommended reading: Organisational culture and leadership, E.H.Schein, Jossey-Bass, 2010) 47
  • CORPORATE CULTURE Corporate culture Is a matter of: people, believes, motivation & attitude48
  • What OBJECTIVES should have been reached to build a corporate culture?49
  • The objectives to be reached are:50 A culture of motivation
  • The objectives to be reached are: NIKE SHOES “NO GAMES, JUST SPORT”51 A culture of listening
  • The objectives to be reached are:For instance, this PC is theresult of a constant search forexcellence: • BETTER • FASTER • CHEAPER • SMALLER • SIMPLER 52 A culture of excellence
  • The objectives to be reached are:What is YOUR corporate culture?How do you evaluate it? What is its decision making process? A culture of searching 53
  • Leadership 54
  • « Every day in life, there is a new question. That is what keeps us going. » 55
  • According to Jack Welch What leaders do1. They relentlessly upgrade their team2. They live and breathe their vision3. They exude positive energy and optimism4. They establish trust and transparency5. They have to courage to take unpopular decisions6. They probe and push with a curiosity7. They set the example8. They celebrate 56
  • Motivation In the final analysis a variety of SKILLS willcontribute as much as your formal academic training to your and the organisation’s SUCCESS 57
  • Assessing Your AbilityNo matter what lifethrows at you in a day,always keep FOCUSEDon your goals.« Does is matter to mygoal?» If not, thencross it off! 58
  • 1. Good DECISIONS have taken consequences into account2. Good decisions entail clearly defined responsibilities3. Good decisions require the right corporate culture4. Good decisions require leadership5. Good decisions require the knowledge of the broader picture 59
  • 1. Strict adherence to (behavioural) norms2. Internal and external communication3. Clearly spelled out procedures4. Efficient and effective controls5. Efficient reporting6. Hands on management7. The qualities of good leaders 60
  • Part 3 – Structured Thinking
  • 62
  • Discussion • What were the CONSEQUENCES of the wrong decisions? • What would have been CORRECT decisions? 63
  • WHAT are the characteristics of a good credit? The five C’s of Credit assessment – Character - the willingness of the borrower to repay – Capacity - the ability to repay the debt from cash flow – Collateral - the security backing the loan – Capital - the strength of the borrower’s balance-sheet – Conditions - the sensitivity of the project to outside factors such as economic cycles and competition
  • WHAT WENT WRONG? So superficial No “hands-on” management Control & audit Reporting No understanding
  • WHAT WENT WRONG? Feeling of something unusual going on Unread reports Inappropriate use of legal loopholes Profits without ethics Abusive public relations Black box accounting
  • WHAT WENT WRONG? Convincing anyone else that they are smarter Unusual large profits & risk taking Many un-answered questions Pressure to do business at any price or abuse Perception = the reality No or little values
  • WHAT WENT WRONG? Lack of structured thinking1. Simplification to allow for best & worse case scenario2. Visualisation to understand the issues3. Assuring the understanding of the key issues4. Right presentation to allow for an educated decision making5. Associations are a strong helping hand
  • The subprime crisisDiscussion In your view: (1)What could or should have been done? (2)Is regulation the answer? (3)Will it re-occur? 69
  • How would you explain the financial markets?Discussion 70
  • The power of association 71
  • The power of associationWhat might be the difference between those markets?1. The money market2. The capital market3. The foreign exchange market4. The stock market5. The futures market 72
  • The power of association•ASSOCIATION is a helping hand toyour long term memory, i.e.retaining and retrieving information•A powerful help is IMAGES - theyspeak a thousand words 73
  • Discussion What is the ECONOMY telling us? 74
  • Government Central Bank Products & Services GNP WHAT? ENTREPRENEURS HOW? CONSUMERS FOR WHOM? Salaries, interest, rentals LABOUR
  • Recommendedreading if you are interested in the economic environment! 76
  • 1. Good decisions have taken consequences into account2. Good decisions entail clearly defined responsibilities3. Good decisions require the right corporate culture4. Good decisions require leadership5. Good decisions require values 77
  • 6. Good decisions require skills7. Good decisions require anticipation8. Good decisions require structured thinking 78
  • A last note on values« Values are bestdemonstrated as opposed to talk about it! » Richard Hytner, Saachi & Saatchi79
  • Part 4 – Intuitive & creative thinking
  • 81
  • 82
  • Intuition is the ability to acquireknowledge without inference or the use of reason 83
  • To big to failDiscussion What should have been the CORRECT DECISIONS? 84
  • Managementby questions 85
  • 86
  • How does brainstorming work? 87
  • How does brainstorming work? What motivates YOU ? 88
  • How does brainstorming work? 89
  • How does brainstorming work?This PC is theresult of a wayof thinking: Better Faster Cheaper Smaller Simpler 90
  • How does brainstorming work? 91
  • 92
  • Think Different Steve Wheeler, University of Plymouth, 2011 Kick start your brain. New ideas come from watching something, talking to people, experimenting, asking questions, getting out of the office - Steve Jobshttp://steve-jobs-biography.pics-grabber.appspot.com/
  • 94
  • In the final analysis a variety of SKILLS will contribute asmuch as your formal academic training to your and the organisation’s SUCCESS 95
  • 6. Good decisions require skills7. Good decisions require anticipation8. Good decisions require structured thinking9. Good decisions require questioning10.Good decisions may require intuition 96
  • Part 5 – Creating consensus
  • Reaching consensus &communication 98
  • Discussi on 99
  • Getting out• You are in the Arizona desert in the hottest time of the year. Because of a fire, the plane had to land and most of the contents have been destroyed but fortunately none of the three passengers and the pilot are hurt. You know that you are about 75 miles from the nearest town. Fortunately you have some pieces of equipment and items left that you could use for your survival.• The decision to make is: either to stay put and wait for help or move and walk the 75 miles to the nearest town.• Whatever the decision it needs to be taken unanimously! 100
  • Getting out• Below is list of available items, you should list them in order of importance to your survival, one being the most important, and decide what items to take with you in case you decide to move. You may also take the decision to stay and wait for potential help but should still list the items in order of value to your survival: 1. Compass 8. 1 case of rations 2. Small transistor radio 9. Maps of the desert 10. Cushions 3. Shaving mirror 11. 5 litre of an oil/gas 4. Snake repellent mixture 5. 5-liter of water for the four of you 12. 1 bottle of rum 6. 4 square meter of opaque plastic 13. Two boxes of 7. Mosquito netting chocolate 14. 5 meter of ropes 15. One boomerang 101
  • Creating consensus1. Clearly frame the issue to be decided & determine the result you desire to achieve (during the meeting).2. Clearly explain the process of decision making which will be used.3. Clearly explain the role of the facilitator.4. Use a "straw polling" procedure to see how the group is leaning on an issue and to facilitate the decision making process. 102
  • Creating consensus5. The standard for consensus is that the whole group must agree with the decision. Each individual member must agree that the decision is what he or she wants. Do not allow the standard to drop to "I can live with it." or "Ill go along to get this meeting over with." Encourage participants to stand their ground.6. 6. Expect dissent and disagreement during the process and view this as a positive step towards a high quality decision. Decisions made without dissent are often of poor quality.7. Encourage participants to be direct and concise in all communications. 103
  • Creating consensus8. Encourage everyone to actively listen to each person in the group and to seek to understand other points of view. Look for the possible merit of each others opinions.9. Encourage everyone to approach the meeting and the decision in a rational manner rather than an emotional one.10. If the meeting gets off track or people become focuses on their own comfort or emotion, re-focus the group on the desired result 104
  • 11.Good decisions require consensus12.Good decisions require a structured approach and methodology 105
  • Part 6 – Implementation & Communication
  • A picturespeaks athousand words! 107
  • Communication « Communications are an essential part of what you have to offer to the stakeholders » (Michael Dell) 108
  • Communication• « Corporate communication is a management function that offers a framework for the effective coordination of all internal and external communication with the overall purpose of establishing and maintaining a favourable reputation with stakeholders groups upon which the organisation is dependent. » (J. Cornelissen) 109
  • CommunicationCommunication requires• An emphasis on dialogue and interactivity• Focus on stakeholders’ needs• Involvement of all functions and people• A focus on branding (excellence)• A focus on how well staff members are regarded• A focus on the context• The willingness to be a key driver• Branding as a key aim 110
  • CommunicationThe goal of communication• Is geared towards establishing a favourable corporate image and reputation with all the stakeholders, so that they act in a way that is conductive to the success of the organisation!• It is the spectre of damaged reputation that lies behind the urgency of doing and saying the right things, now! 111
  • WorkshopWhat competencies and skills does a professional communicator need?
  • The requirements for a professionalcommunicator (based on a recent UK survey / in order of importance)Verbal communicationIntegrityInfluence, persuasion and diplomacyWriting and editing skillsCritical judgmentEnthusiasm, motivation and curiosityAssertiveness and confidence 113
  • The requirements for a professionalcommunicator (based on a recent UK survey / in order of importance) (continued)Reflection, learning from previous experienceIntuition and perceptionCreativityProblem solvingOrganisation, planning and task focusUnderstanding the business strategyPresentation skillsUsing information technology & e-communicationsBudget management 114
  • Communication • Promises arise from spoken and written communication •It is a matter of gaining a position in the minds of the stakeholders 115
  • CommunicationThere are three concepts that form the theoretical foundation of corporate communication:1. The stakeholders2. The corporate identity3. The reputation• Organisations have realised that now more than ever they need to listen to and communicate with a large range of stakeholders 116
  • Communication- stakeholders investors politicalgovernments groups suppliers organisation customers tradeassociations communities employees 117 Source: Corporate communication, J. Cornelissen
  • CommunicationStakeholders• A stakeholder is any group or individual who can affect or is affected by the achievement of the organisation’s purpose and objectives• The interest can be of an economic or of moral nature.• Example of community stakeholders: consumers, regulators, government,media, local communities,pressure groups 118
  • Communicationstakeholder awareness understanding involvement commitmenttactics newsletters discussions consultation collective reports meetings debate problem memos advertising solving free adds educational campaignstype of informational persuasive dialogue dialoguestrategy 119 Source: Corporate communication, J. Cornelissen
  • CommunicationA communication strategy should be basedupon an assessment of the GAP betweenhow the issue is currently seen and howYOU want it to be seen. DG HR.B.3 - Learning and 120 Development
  • CommunicationFormulating the content of a communication strategy vision reputation strategic intend define target audiences themed messages message styles message media 121 Source: Corporate communication, J. Cornelissen
  • Communication• Avoid vagueness• How the message is said is paramount• Tone and manner of communication are customer based• Continuity, consistency• Altering perceptions is very difficult• No neglect of consistency & harmony in: – names – logo – colour – message 122
  • CommunicationThe challenge is to be brief, structured, focused 123
  • CommunicationCommunication requires an interface between what is being said and what is being done 124
  • CommunicationRemember the basic structure of any message INFOR-SITUATION PROBLEM CONCLUSION MATION IMPLICIT EXPLICIT 125
  • 126
  • 127
  • • Internet • Forum - Blog – Website • Wiki – Static content – Dynamic content – 1 webmaster – Community – Yearly content update – Continuous update• E-mail • Social networks – One to one – Collaborative content – One to many – Many to many communication 128
  • Twitter Blog Website Facebook LinkedIn129
  • “The rise of social media makes it more important than ever to get the branding fundamentals right” “You do not need to rewrite the marketing playbook but to exploit social media opportunities while keeping an UNWAVERING FOCUS on meeting the customers’ needs” HBR Dec, 2010130
  • Good communication means? 131
  • 1. Good decisions have taken consequences into account2. Good decisions entail clearly defined responsibilities3. Good decisions require the right corporate culture4. Good decisions require leadership5. Good decisions require values 132
  • 6. Good decisions require skills7. Good decisions require anticipation8. Good decisions require structured thinking9. Good decisions require questioning10.Good decisions may require intuition 133
  • 11.Good decisions require consensus12.Good decisions require structured implementation13.Good decisions require clear communication 134
  • Part 7 – Implementation
  • Implementation 1. Define 2. Measure 3. Analyse 4. Innovate or ImproveDMAIC 5. Control
  • Define HR & mgt customerleadership planning results market processes Improving the drivers impacts the results
  • Define Performance indicators How do we know we are getting closer?Where are Where are How do we? we going? we get there?Assessment Planning Processes
  • Define HR & mgt improved motivation customer improvedleadership planning Results market service processes Improving the drivers impacts the results
  • Define What is a process? INPUT OUTPUT •A process is a set of linked or related activities transforming inputs•The quality of the process determines the quality of the output
  • Define• A project needs a project leader• Determine the role of the key players• Define the boundaries of the project• Help clarifying the objectives• Define which information is needed• Determine his role (desire to have power over a team is a no-win situation!)
  • DefineA project leader’s check list:1. The problem2. The goal3. Role expectations4. People involved5. Restrictions6. Reporting7. Next stage
  • DefineA project will have greater success if:• The problem is related to a key business issue• The problem is linked to a clearly defined process• The internal and external beneficiaries are clearly identified• The improvements can be demonstrated• The improvements contribute to the overall performance• There is sufficient organisational support• The results are visible with a pay-back period
  • Define Example of a potential result analysisExpected Benefit of that Expectedimprovement improvement busines impactReduce errors Less time 5 % increasein processing spend fixing in monthly errors, speed revenues up work flow
  • DefineA project leader’s chart:How to DMAIC & define the milestones & create a milestone planWhat is a milestone? Milestones are:• Measurement points• Indicate a logical order• Directed towards the goal• Allow for communication Project start Finish
  • Define Questions to considerProjectWhat issues are you addressing?What problems do customers have with the process?Expected business resultsWhat will be the business impact of the improving process?How will team members benefit from succesful completion of this project?FocusWhat information will be collected?What areas are inside or outside the scope of the team?On what specific parts of the process will the team focus?DeliverablesWhat must the team deliver to be succesful?MeasuresWhat will be the primary measure of successHow will measures be tracked?How much improvement is needed and when?
  • Discussion TASK How would you make sure that (retail) investors take the right decision when purchasing mutual funds? 147
  • Assuring investors make the right decisions (1) (2)Customer profiling Product profiling (3) A perfect match at the right price 148
  • Assuring investors make the right decisions Investments 149
  • Assuring investors make the right decisions 150
  • Assuring investors make the right decisions (1) (2)Customer profiling Product profiling (3) A perfect match at the right price 151
  • Assuring investors make the right decisions 152
  • Assuring investors make the right decisions (1) (2)Customer profiling Product profiling (3) A perfect match at the right price 153
  • Assuring investors make the right decisions 154
  • Measure• Measure is about process mapping technique• Different process require different types of processmaps• Process mapping should lead to process improvement• The word « process » generates fear and resistance
  • 156
  • MeasureWhat is a process map?• A detailed graphical representation of a process flow• The identification of specific steps eventually opportunitiesfor improvement• Required tool to think about value
  • MeasureWhy use process maps?• To sharpen your ideas• To have a common understanding• To examen which activities have the greatest impacton profits• To reveal non-value added activities• To serve as a training tool• To compare the existing process to an ideal, simulatedprocess
  • Measure Basic symbols First and last steps in a process Particular steps in a process Yes-no decision points Subroutines or connection points Flow of movement of the process
  • Measure Example : new employee arrivalArrival Review policies Office tour & procedures no Clear Answer questions ? yes Fill out forms Forms processing
  • Measure Example : new employee arrivalArrival Review policies Office tour & procedures no What are Clear Answer questions possible ? issues? yes Fill out forms Forms processing
  • Measure• Describe the step by step process of the things you do between the alarm clock ringing in the morning and the moment you leave the house.• How could you reduce this process or gain time?
  • MeasureValue stream mappingA quantitative tool by which onedescribes in detail how a processshould operate to create flowA value stream mapping is thefoundation for all Lean activitiesIt focuses on the customer andwhat he considers as valueWaste abounds in informationprocesses, which is the reasonwhy tracking the rightinformation is so important
  • MeasureDescribe the value stream map for a credit card attribution process whenan application for a card is received by mail.How much time would it take?
  • MeasureCREDIT CARD PROCESSCentral mail deptCredit card deptRequest introductionRequest approvalPhysical card creationVerification cardCredit dept mail sortCentral mail dept
  • 3.1.2 Measure Answer based on an attribution process of a large bank (source Process Excellence)The requests for a credit card are sent by the customer via mail.Central mail officer opens the envelopes (10 sec.) sorts the requests to thecredit card dept. (5 sec.) and places them in the outbox. The mail istransmitted the next day to the credit card department. Queue time beforenext action 8 hours.Credit card dept mail sort: requests are sorted per region (5 sec.), a datastamp is added (2 sec.) and the orders are placed in folders for the creditanalysis (10sec.). The work is performed by the credit admin. Qeueu timebefore next step 4 hours.A junior credit analyst is initiating the request (9min. 15 sec.). Queue timebefore next step 4 hours.The senior analyst check the income of the customer (7 min. 45 sec.), checkthe internal (5 min.) and external black list (7 min.) for credit abusers andapprove or refuse the request (4 min.). Queue time before the next step 2hours.
  • MeasureAnswer based on an attribution process of a large bank(source Process Excellence) – (continued)The junior credit analyst perform the physical creation of the credit card andprint the letter to send the card to the customer (7.5 min.) and files a hardcopy of the card request (90 sec.). Queue time before next step 1 hour.The senior analyst verifies the created card: name, number, valid date, (3min.45 sec.). Queue time before the next step 4 hours.The credit analyst uses the mainframe computer to perform the work.The credit department mail sorter puts the letter and card in an enveloppeand closes the envelope (30 sec.) . Queue time before next step 4 hoursThe central mail office posts the letter. Queue time before expedition 8hours.Total time of the work flow : 128.717 sec.of whichTotal cycle time: 2.717 secondsTotal queue time 2100: 126.000 sec.
  • MeasureFunneling is a technique used to select the critical, best one or few items from a whole list of items.  The critical process/input variable from all variables  The critical step out of all steps  The best solution from a list over several solutions
  • MeasureFunneling is a technique used:  when there are too many variables which might have an impact on the output of the process  there are too many solutions to choose from  it would require too much time and money to analyze everything  team members have different ideas about what happens in a process
  • MeasurePriority matrixEstablishing a priority matrix equally helps in determining priorities
  • Measure 1. List all output variables Output variables 2. Rank and Weight3. List all Input and these output 10 shots per Safe for the accurate distance variables operator Process variables minute Shot Weight 10 3 1 Drawback angle 9 0 1 5. Cross-Multiply Stop position 9 0 0 Weight and Cup position 9 0 0 relationship factor Left hand 5 5 9 Right hand 5 5 9 Rubber band 9 5 9 4. Evaluate the Ball type 9 9 0 relationships Ball number 0 5 9 6. Highlight the Extra operator 1 9 9 critical few variables
  • Measure 2. List all selection 3. Discard No Go Solutions and 1. List all concepts or criteria and weigh select the reference solutions there importance 4. Evaluate every concept and criterion versus the reference 5. Count and and score + summarize when better, - weighted sums. when worse andCalculate the total S when thescore per concept same. 6. Highlight the best one
  • MeasureCause and effect diagram Storm Power Old Bulb Burned Missing•A cause and effect diagram Power Outage Out Bulb Power Plant Brokengraphically displays potential Failure Is Current On? Loose Circuit Breakercauses of a problem No House Is Bill Paid? Current Missing•The layout shows cause-and- Unpaid Bill Wall Switch Lamp Turned Off Assembly erroreffect relationships between the Doesn’t Turn Onpotential causes Not Plugged In Switch Broken Chewed by Dog Switch Missing Cord Cut Vandal No Contact Corroded Plug/Cord Lamp
  • MeasureCause and effect diagram Usual profile develop Unusual profile analyse Existing Customers develop Usual transact Profiles/trans analyse Market Unusual trans actions Usual profile acquire Potential Unusual profile analyse Customers Profiles / Usual transact acquire Potential analyse Unusual transact transactions
  • MeasureData collectionCollecting and analyzing datatakes time and resources.It is important to ensure sufficientdata, in quantity and type, iscollected right from the start toprevent having to collect moredata down the road.
  • MeasureData collection However, do not get overwhelmed by to much data. Make sure they can still be reasonably analyzed and understood, taking into account the time and methods available. Part of the challenge is to decide just how much data will be sufficient (and representative) to reach a perfect balance.
  • Analyse Tools for analysis - a time plot is a graph of data ordered in time 140 130 120Number of days 110 100 90 80 70 0 10 20 30
  • AnalyseThe importance of order of 65 The process has a sudden shift. 60 time 55• Process conditions can 50 change over time. 45 40 Data from one point in 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 time are not always comparable to those at Four points look very different from the others. 65 another point in time. 60• If you ignore time-related 55 patterns, your conclusions 50 45 may be false. 40 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41
  • ImproveAdjust PlanCheck Do
  • Improve• The PDCA Cycle is a set of activities (Plan, Do, Check, Adjust) designed to drive continuous improvement. Adjust Plan• Initially implemented in manufacturing, it has broad Check Do applicability in business. First developed by Walter Shewhart, it is more commonly called the Deming cycle in Japan where it was popularized by Edwards Deming.
  • Improve What is the PDCA cycle?• PLAN: plan ahead for change• DO: execute the plan, taking small steps in controlled circumstances• CHECK: check and study the results.• ADJUST: take action to standardize or improve the process, eventually adjust the plan
  • ImprovePLAN• Analyze what you intend to improve, looking for areas with opportunities for change.• The first step is to choose areas offering offer the most return for the effort you put in. Plan
  • ImproveDO• Implement the change you decided on in the plan phase.• Implement the corrective action. Do
  • ImproveCHECK• This is a crucial step in the PDCA cycle.• After you have implemented the change for a short time, you must determine how well it is working: is it really leading to improvement in the way you had hoped and planned? Check
  • ImproveADJUST• Implementing and then monitoring the change, you must decide whether it is worth continuing.• If it consumed too much time, was difficult to adhere to, or even led to no improvement, you may consider aborting the change and planning a new one.• However, if the change led to a desirable improvement or outcome, you may consider to proceed or adjust.• Make the changes a routine part of your activity. Adjust
  • ImproveThe usefulness of the PDCA cycle:• The PDCA cycle is a valuable process that can be applied to practically anything• Offers you the most effective and efficient roadmap to implementation of a solution.• The PDCA cycle is designed to be used as a dynamic model: the completion of one turn of the cycle flows into the beginning of the next.• Following in the spirit of continuous improvement, the process can always be reanalyzed and a new test of change can begin
  • ImproveWhen can a PDCA cycle be used?• For daily routine management (for the individual and/or the team).• For project management.• For implementing solutions.• For problem solving.• For continuous development and continuous improvement.
  • ImproveHow to use a PDCA cycle• This is a schematic representation of the use of the PDCA cycle in the improvement process.• As each full PDCA cycle comes to completion, a new and slightly more complex project can be undertaken. This rolling over feature is integral to the continuous improvement process.
  • Control What ?Why ? Criteria for a good scorecard 1. Policy deployment Every measure is a part of a chain of cause and effect linkages that represent the strategy. 2. Linked to business results Every measure ultimately ties to business Balanced results. Scorecard = a control 3. Well-defined KPI’s dashboard - Expected outcome - Performance indicator - Target 4. The balanced scorecard provides a framework The strategic objectives/critical goals are to be linked to any of the 9 boxes of the Process Excellence Assessment Model.
  • ControlA balanced scorecard• is a system of linked objectives and performance measures (KPIs) which collectively describes the strategy of an organization and how that strategy can be achieved.• Balanced : – Not only financial outcomes
  • ControlA balanced scorecard’s use• A. Typical measurement system weaknesses• B. We need measures to manage the three main levels of an organization : • Organizational level • Interdepartmental level • Individual level.
  • ControlWithout measures, managers have no basis for :• Specifically communicating performance expectations to subordinates;• Knowing what is going on in their organization;• Deploying their strategy down to the lowest level;• Effectively making and supporting decisions regarding resources, plans, policies, schedules and structures;• Providing feedback that compares performance to a target.
  • Control Strategy How vision Organizational level Critical goals/objectives X+3 KPI How What Target Items to work on Interdepartmental level Critical goals/objectives X+1 KPI How What Target Projects/problems/processes Individual level Objective on individual level KPI What TargetEvery measure is a part of a chain of cause and effect linkages that represents the strategy
  • Control Examples of a KPI KPI Expected outcome Perform. indic Target Strategy Critical goals Positive trend in Market share 10 % no. of customers Brand recognition who differentiate us from our com-Delighted customer Improve brand dominance petitors by the brand they buy Critical goals KPI Expected outcome Perform. indic. Target Positive trend in On time delivery > 95 % Enhance customer service to the cust. Vendor scorecard Score of 90-95% service in terms of time, (# complaints) < 5/year quality & cost KPI Individual goals Expected outcome Perform. indic Target Multi-skill ness Positive trend in Multi-skill ness Improvement flexibility to matrix with 1 level react quicker to customer inquiries
  • 1. Good decisions have taken consequences into account2. Good decisions entail clearly defined responsibilities3. Good decisions require the right corporate culture4. Good decisions require leadership5. Good decisions require values 195
  • 6. Good decisions require skills7. Good decisions require anticipation8. Good decisions require structured thinking9. Good decisions require questioning10.Good decisions may require intuition 196
  • 11.Good decisions require consensus12.Good decisions require structured implementation13.Good decisions require clear communication14.Good decisions require a systematic implementation & performance measurement15.Good decisions require a disciplined approach 197
  • Part 8 – Change Management
  • Hans Roslings on CHA NGE 199
  • The WHY WHAT HOWof Change Management
  • Changing attitudes Changing attitudes is a challengeconfirmation,justification rational opinions, principles 80% of the activities of motivation people decisions personality structure
  • Changing attitudesDiscussion What are obstacles to change?
  • Changing attitudesThe wrong attitudes • Standards are made to be followed not to be improved. • Cowboy individualism • Fear of the unknown • What is in it for me only? • « Been there, done that… »
  • Why Do People Resist Change?• The phrase, “overcoming resistance,” indicates an adversarial relationship … since resistance is an emotional process, the key is understanding it: – People resist change because the change is: • Perceived by them to be negative, and • They do not want to deal with the reasons for it – Resistance is a way of expressing feelings of concern about making a change – These concerns tend to be: • Concerns over loss of control • Concerns over vulnerability – Your task is to help the person who is resisting change to express these concerns directly
  • Why Resistance Occurs . . .• Resistance can occur because people fear: – Loss of credibility or reputation Indirect Expressions – Lack of career or financial of Concerns/ Visible Resistance advancement – Possible damage to relationships Real/ with boss Underlying Concerns – Loss of employment – Interpersonal rejection – Change in job role – Embarrassment/loss of self-esteem – Job transfer or demotion Your task is to encourage the full expression of the real/underlying concerns.
  • Three Steps to Dealing with Resistance• Step 1: Identify the form the resistance is taking: – Trust what you see more than what you hear – Pick up cues – Listen to yourself — use your own feelings as a barometer • Uneasy, bored, irritated – Listen for repetition/telltale phrases – Make two good-faith responses• Step 2: Acknowledge, name the resistance: – Tell person your perception of the resistance – Do it in a “win/win” manner; neutral, non-aggressive - “What I think I hear you saying is . . .” – Tell the person how the resistance is making you feel – Be specific, clear, authentic• Step 3: Be quiet, listen, let the person respond: – Get him/her talking – Encourage full expression of the concerns – Gradually uncover underlying resistance/issue - be aware of other forms of resistance surfacing
  • Dealing With Resistance: What Not To Do • Fight the resistance • Expect approval, encouragement, support • Go into more data and/or affection collection • Lose your confidence • Reengineer in the attempt to get a better intervention • Expect to have all the answers • Avoid the individual • Collude with the individual • Work more with your • Avoid giving “bad news” “allies” • Use aggressive language • Give lots of reasons – “You Dummy” Rule • Get hooked into the details • Delay/wait one more day
  • Tactics to Minimise Resistance• Explain why • Provide appropriate training in new skills and coaching in new values and• Identify the benefits behaviors• Invite and answer questions • Encourage self-management • Give more feedback than usual to ensure• Solicit participation, and, if possible, people always know where they stand early involvement • Allow for resistance. Help people let go • (“first-draft/strawmodel” of the “old” reviews, membership in planning/implementation teams, • Measure results, step back and take a etc.) look at what is going on. Keep asking “Is the change working the way we want it• Avoid surprises to?” • Encourage people to think and act• Set standards and clear targets creatively • Look for any “opportunity” created by the• Inform/involve informal leaders change• Recognize and reward efforts • Allow for withdrawal and return of people• Over communicate who are temporarily resistant
  • Changing attitudes The right attitudes • Excellent people and companies focus primarily on beating themselves • How can we improve ourselves to do better tomorrow than we did today? •Where can we improve the end to end process? •You are the only one who can change YOU = M.B.O. MANAGEMENT BY OBJECTIVES !
  • Changing attitudes Changing attitudes Your know-how Professional Trust Satisfaction Status Appreciation & IncomeEvery member of staff is at the beginning of a personal value chain
  • Changing attitudes• Transforming corporateperformance bymeasuring and managingthe drivers of businesssuccess•80 % of changeinitiatives fail due tohuman factors•An organisation movesslower than theindividuals who make upthe organisation!
  • Changing attitudes Discussion•What do you and yourcolleagues truly value?•What can you do as anindividual in a companythat is embarking upona different journey?
  • Changing attitudes•Change managementmeans the ability to listen,the ability to teach andguide, and the ability tolearn and consideralternative viewpoints.•It develops the attitudethat you do not always beright or have allthe answers.
  • Changing attitudes Discussion• How can you ENFORCE change? 214
  • Changing attitudes QUANTITATIVE OBJECTIVES PERFORMANCEDESCRIPTION PROFILE IMPROVEMENT QUALITATIVE OBJECTIVES Management by Objectives
  • Changing attitudesSummary step by step goal setting1. Determine the goals by means of a swot and questions2. Determine qualitative and quantitative goals3. Plan the implementation in a time frame4. Control in a time frame5. Establish accountability6. Determine alternative actions7. Communication and information to all involved Management by Objectives
  • Changing attitudes• You do not directly motivate people, they are motivated to fulfil the their basic human needs, which vary in degree or intensity from individual to individual• The manager’s task is to create reinforcing conditions where staff can see “what’s in it” for them on condition they stretch themselves and gap the difference between goals and performance.
  • Changing attitudes• Performance should be reviewed on a continuous basis. This means that in case of none or weak performance the employee is counselled immediately.• However, once a year the performance should be appraised in a more formal manner.
  • Changing attitudes• There should be no surprises as to the items discussed.• The purpose of the review should not be an in depth analysis of the past but an assessment of reached objectives, of the present situation of the employee and above all it should be forward looking.• The goal is to improve on the present performance, whatever it is.
  • Changing attitudesMBO should be a win-win situation!
  • Changing attitudesMBO should be a win-win situation!
  • Changing attitudesMBO should be a win-win situation! Bottom up Top down planning planning
  • What are the qualities of an evaluation process? MBO should be a win-win situation!
  • Changing attitudesThe qualities of anevaluation process 1. Importance of the process 2. Partnership 3. Respect 4. Constructive 5. Objective 6. Specific MBO should be a win-win situation!
  • Changing attitudesHow can you be sure the system works?• By being fair, by rewarding those who really want to move forward and by penalising those who do not. It is a system whereby you either move upwards or outwards but where there is no room for mediocrity.• Average performance pushes overall performance downwards.• You want to move upwards, not downwards.
  • Changing attitudesYou want to move upwards, not downwards.
  • Changing attitudes• The ultimate goal is to be seen to be better than the others or at least different than the others!• It is the responsibility of everybody, irrespective of that person’s position in the organisation.
  • CHANGEDiscussion • What kind of CHANGE is ahead of us? • What does it take to ADAPT? 228
  • CHANGE1. Aging2. Power shift eastwards3. Global connectivity4. GRIN technologies5. Environment Genetics, Robotics, Internet, 229 Nanotechnology
  • Leading Change insight wisdom perspective A Brief Visual Narrative by Adam Walz
  • Mastering delicate situations• The more you are structured the more chances you have to reach a solution.• « Lay back! » You are not being blamed personally!• YOU are NOT part of the problem, you try to resolve it
  • Mastering delicate situations• You are looking for a solution in the capacity of a consultant• The customer is neither always right nor wrong. It does not matter. What matters is that you are a professional solving a problem• Remember that you are the best advertisement!
  • Mastering delicate situations• Always take objections very seriously• Be conscious about your attitude• Isolate each objection and address them one by one• Always finish a conversation on a positive note• Go to the very end• Conclude with closed questions (yes or no)
  • The attitudes of wisdom• What matters is concluding• A customer complaint represents an opportunity• Think about the marketing aspects of a complaint. A complaint is a piece of marketing information• One can commit an error but not twice the same.
  • The attitudes of wisdom• Never be on the defensive side, you are a consultant, who is looking for a mutually acceptable solution• Never be critical, the only criticism is constructive criticism• Never promise what you cannot deliver
  • The attitudes of wisdom• Learn from each situation what you can make out of it, knowledge means survival!!!• Good luck, whatever your level of professionalism, you do need some luck!
  • Workplace Change and TransitionRedirecting your thoughts and overcoming fear By Catherine Adenle http://catherinescareercorner.com
  • Part 9 – Winning
  • CORPORATE CULTURE =SHARED VALUES & GROUP BEHAVIOURNORMS 239
  • ME incorporated =MY VALUES & MY NORMS 240
  • CORPORATE CULTURE = VISIBLE LEVEL (BRANDING) & SHARED VALUES241
  • Would YOUlove to be thefirst one thatcomes to mind? 242
  • 243
  • 244
  • The 20 steps for good DECISIONS1. Examine every alternative2. Use previous decisions if the are still applicable3. Make long term decisions with the short term in mind4. Change decisions that are no longer appropriate5. Consider the implications of each decision6. Try to foresee and prepare for any changes7. Always ask what can go wrong with your decision8. Always consider the possible outcomes9. Always try to balance intuition and logic10. Avoid making decision that have a large element of chance in them 245
  • The 20 steps for good DECISIONS11. Follow a precedent when it works12. Challenge the company culture if need be13. Be aware of politics behind decisions14. Weigh the impact of decisions on people15. Do not be afraid to delegate the process16. Do not be afraid of rejection, think about an alternative17. Build your trust in decision making18. Never make decisions under pressure19. If it proves to be a wrong decision, take fast action20. Never postpone vital decisions – make them quickly 246
  • Other final points• Decision making is not an exact science,• Behind data there are men and women!• Thinking is not a tidy process but it should be done with a sense of order• Remember that solutions are the seed of new problems• Bad decisions are unforced errors but if you want to win their number should be limited• It is always worthwhile to listen to people• A problem is a solution in disguise• Brainstorming: reverse brainstorming = in how many ways can this idea fail? 247
  • Other final points• We need critical input from others to remove the filters from our eyes• Remember the mental roadblocks: – Lack of facts – Lack of conviction – Lack of a starting point – Lack of perspective – Lack of motivation 248
  • Other final points• IF YOU TRULY WANT TO DEVELOP YOUR THINKING SKILLS, YOUR TASK IS ESSENTIALLY ONE OF SELF-DEVELOPMENT 249
  • Other final points• A STRONG MESSAGE HAS TO BE DELIVERED BY THE NUMBER ONE• DATA WITH A SOUL IS A STORY 250
  • WHAT YOU COULD DO AFTER A…. 251 GOOD DECISION
  • contact@rogerclaessens.be252
  • ACTION1. Fix a meeting with you in your agenda on a regular basis2. Act as if you are rowing with a large team even if you are only a few3. Have goals and performance evaluations even if you are a ME incorporated4. Have the PC- development approach: faster, better, simpler, cheaper!5. Give yourself a tap on the shoulder occasionally 253 253
  • www.europa.euwww.economist.comwww.connectwiththeeuropeans.euwww.wikipedea.comwww.marketingmagazine.co.ukwww.cim.co.ukwww.amazon.cowww.ec.europa.eu254
  • « Corporate reputations, branding and HR », G.Martin & S.Hetrick, BH,2006« Corporate communication »,J.Cornelissen, Sage, 2008« Growing brand loyalty », R. Evans, Lafferty, 1997« The black swan », N.Taleb, Pinguin 2007« Marketing management » Kotler, Dubois, Publi Union, 2000« eBrands », Phil Carpenter, Harvard School Press, 2001« Organisational culture and leadership », Edgar H, Schein, Jossey-Bass, 2010 255