Agile methodologies, bath university march 2011

Bath University – School of Management – EMBA Class of 2011 & Risk Management Option 2010.03.25

MBA 2011 & Risk Management Module
(Prof. Emmanuel Fragnière)

Identifying, structuring and piloting disruptive situations
using agile type of methodologies

Approaches and case studies

2


Synopsis :
  Agenda
  About us
  Managing disruptive situations
  Case study : Disruption in the luxury Hotel
Industry
  Wrap-up & Good-luck

March 25, 2011
3


Time table

Friday March 25, 2011

Concepts + Methodologies

Training using a case

Luxury Hotel Part A
- Working Group preparation
- Group presentations
- Plenum discussion

Luxury Hotel Part B
- Working Group preparation
- Group presentations
- Wrap-up

4


Synopsis
  Agenda
  About us
Industry

March 25, 2011
5


About us

Patrick Bays Philippe Steinmann
  Lic. Econometrics, MBA IMD   Expert Auditor
  15 years of international   20 years of international
exposure in exposure in :
o  the prototyping and the o  the management of
implementation of disrutptive special projects
innovation o  Supporting organizations
o  change management within facing volatile situations
several industries (high growth rate,
turnaround)
  PwC, Tetra Pak, Swisscom,   KPMG, Ilta Holding,
UCB Pharma, Wake Asset Euroterminal
Management

  English, German, French   English, French

6


Synopsis :
  Agenda
  About us
  A : Positioning
  B : Methodologies
  C : Training
Industry

March 25, 2011
7


Risk awareness changes perspectives…

8


Basic reminders: the Board of Directors sets the risk appetite

9


Set the stage and quickly agree upon a common language

Step 1 Step 2 Step 3 Step 4 Step 5

E

Crisis management

Vulnerability
Anticipate Prevent Apply Restore
analysis

Manage the information

Event

Threats Measures Norms and Standards of
protocols engagement

Risk Management Contingency Planning Recovery
Management
Business Continuity Planning
10


These situations have something in common …

Toyota suspends sales January 2010, recall list

… no one anticipated their disruptive character
and the storm that followed.
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A situation of disruption occurs when ...

for a given organizational system….
Period of high
vollatility A new
Equilibrium equilibrium
Correctives
E
measures

A particular event causes a disruption of
this balance which threatens the
sustainability of this system

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Afterwards, most actors agree they were unable to grasp the
severity of the situation …
Symptoms

•  No abrupt change but soft slips Crisis Managing the

High
Potential impact
Management unexpected
causing discomfort and doubts
•  Lack of response and lack of
anticipation leading from the start to
to become chronic victims of events
•  Lack of internal coordination and

Low
Operational Fault
consultation Management Management
•  Chaotic and contraductory internal so
as external communication
Yes No

Anticipated event

…due to a slowly increasing
disturbing feeling invading and panicking them
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The management of such a disruption is fundamentally different
if the triggering event could be anticipated in advance ...


E

Crisis management

Vulnerability
Anticipate Prevent Apply Restore
analysis

React Restore

Managing the unexpected

Event 14


The observation of extreme behaviors in emergency situations
has helped us to define our methodology in business occasions

Crisis situation Emergency doctors

3 minutes
Quality of the information available
Precise, calibrated

ED
SStart SEnd t
Standard behaviors and normed protocols

Mgr
Military forces
Médiocre

…
MiF
SStart SInt.1 SInt.2 SInt.n t
Normed Estimated
Time management emergency situations Method of dynamic resolution
by successive iterations

15


The military method of dynamic resolution by successive iterations

Analyzing and Planning Iterations

Developing the
engagement plan

Shaping decision

Assessment of the situation

Draft backplanning

Triggering emergency
measures

Identification of the problem

16


The economic drama seems never ending…

2008 : Financial Crisis
2009 : Economic Crisis
2010 : Social Crisis
2011 : - Currency Crisis ?
- Government Debt Crisis ?

… Companies have managed to
survive this turmoil by becoming more agile and flexible
17


The Cougars in a nutshell :

  Agenda
  About us
  C : Training
Industry

March 25, 2011
18


Our approach combines the strengths of two frameworks using
cross functional teams to quickly generate an impact

Deep Dive Scrum

•  A technique to rapidly immerse a team •  An agile and lean methodology used for
into a situation for problem solving in : software development:
o  Product development o  Designed to adapt to changing
o  Process improvement requirements during the development
process at short regular intervalles
o  Customer service strategy
o  Allows teams to priorize customers
requirements and adopt work produced
in real time to customer needs

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Deep Dive: step by step http://www.youtube.com/watch?v=M66ZU2PCIcM

Inspiration Ideation Implementation

Observe and inquire

Tell stories

Synthesize

Visualize Realize

Refine Evaluate
Execute

Spread

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http://www.youtube.com/watch?v=vmGMpME_phg
Scrum in a nutshell http://www.youtube.com/watch?v=Q5k7a9YEoUI

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But the IDEO Frameworks reaches some limits as soon as the
requirements need to be re-priorized permanently

Scrum

Scrum methodology
mainly used for software
development provides a
strong framework to
address this topic

22


An high level illustration of our Agile Development Methods

A dynamic approach under dynamic environmental monitoring

Observe and ask

Develop a Storyline

Priorize

Co-Create

Inspiration Ideation Implémentation

Deep Dive Scrum

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In practice, a situation of high volatility is resolved step by step

Project Management & Communication
Urgency measures
Process

Storyline
Implementation,
Agile controls and
Scoping Clarification Gain support
Prototyping adjustements

Planing

Decision Decision Decision Decision Decision
Tool-Box

Change
management &
Implementation

24



  Admin stuff
  About us
  C : Training : the Ukrain’s case
Industry

March 25, 2011
25


The Ukrainian case : 1998 & 2010, bis repetita
General situation: the Ukrainian environment End of the 90’

Ecosystem was reaching an equilibrium :
•  Liberal government, development of an economy oriented
•  Facilities for foreign company to develop business in provinces
•  Stability of the system (social and economic) & the regulation
•  Average monthly salary : 250 - 400 US$
•  Compliance review of all contract by local government 3-6 months later

Particular situation : the Group structure, activities and

Group structure & Activities
•  Trading Co , Crushing plants (250K MT), Distribution’s company
•  Purchase of sunflower seeds in regions for both crushing and selling abroad. Crude oil
produced & sold around the world.
•  Approx. 400 contracts signed and performed per year (seeds, oil, meal)
•  1 lawyer and 2 assistants employed by the group to review the contracts (standard)

Salient factors to be determined
Activity risk, delivery risk, payment risk, contractual risk (review by the government)

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Part A : What are the major salient factors of operating this business
in Ukraine (at an equilibrium state of its ecosystem) ?
1
• 
• 

2
• 
• 

3
• 
• 

4
• 
• 

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Part A : Hierarchy of salient factors in a balanced ecosystem:

1 Risk matrix Eisenhower matrix

High
2 High
Likelihood

Urgency
3
Low

Low
4

Low High Low High

Impact Importance

1 2 3 4 1 2 3 4

28


Part B : Disruption :

Majority Change at the parliament : the communist Party takes over
power on Liberals :

The Parliament will be formed in one week after the election :
•  its objective will be to reduce the margin of private firms for public
companies and increasing taxes, fines and penalties.
•  It will seat from 09:00 to 23:00, 6 of 7 days, toughening laws
strictly and adding a multitude of fines and penalties for any non-
compliance with contract law or in changing contractual terms
(delivery date, quantity & quality treated…).
Changing laws will be treated anarchic and could be amended or
changed every day.
•  Chancery will publish new laws every day at midnight for an
immediate application.

29


Part B : What are the major salient factors of operating this
business in Ukraine after disruption ?

Other ?

…

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Part B : Hierarchy of salient factors after disruption :

1 Risk matrix Eisenhower matrix

High
2 High
Likelihood

Urgency
3
Low

Low
4

Low High Low High

Impact Importance

1 2 3 4 1 2 3 4

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Part B : Prototyping an embryonic solution : the best you can do to
be ready in only one week

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  Agenda
  About us
Industry
  Part A : At an Equilibrium state
  Part B : Managing disruption

March 25, 2011
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  Agenda
  About us
Industry
  Part A : At an Equilibrium state
  Part B : Managing disruption

March 25, 2011
34



  Agenda
  About us
Industry
  Part A : Diagnosis, Scoping and Clarification
  Part B : Prototyping & implementation
  Wrap-up

March 25, 2011
35



  Agenda
  About us
  Managing disruptive situations in crisis
times using agile type of methodologies
Industry
  Wrap-up

March 25, 2011
36


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Agile methodologies, bath university march 2011

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