The document outlines a workshop led by Ari Manninen focused on economic thinking and strategies for organizational success, emphasizing frameworks for strategic agility, leadership, and innovation. It includes exercises aimed at identifying opportunities, tackling challenges, and improving organizational performance through structured rules across various functions such as sales, R&D, and management. The workshop also highlights the importance of understanding numbers and their implications for organizational success in the context of changing business environments.

1. Talouden Workshop
August 20, 2009
Ari Manninen

2. Talouden Workshop
Introduction
• please comment Archie Norman.’s views
Mr Norman has been on the lookout for a fresh turnaround
opportunity, having rescued Asda from near-bankruptcy and
sold it to Wal-Mart for £6.7 billion. He also orchestrated a
revival of Energis that gained him the lion's share of a bonus
pool of £30 million upon the telecom group's sale to Cable &
Wireless in 2005. (Times online)
http://www.ft.com/cms/a7591162-f476-11dd-8e76-0000779fd2ac.html
http://www.pagetutor.com/trillion/index.html

3. Talouden Workshop
Basic numerology
European Usa
6 zero million million
9 zero milliard billion
12 zero billion trillion
18 zero trillion quintillion
The $787 billion stimulus bill passed by Congress
Finland GDP $195.2 billion (2008 est.)
Numerology:
The study of the purported mystical relationship between
numbers and the character or action of physical objects and living things

4. Talouden Workshop
Goals of this workshop
• economical thinking and action – big picture
• economical side of everything
• knowledge and action : how to make knowing doing gap smaller
• executive’s view
• money – more is good
• rigorous thinking and active dialoque – sources of new knowledge

5. Exercise 1. Let us start by locating opportunities!

6. Look at the changing world:
Develop a ”bite framework”
Where lurk the juiciest
opportunities?
(make sure that your proposition is more than some
remarks, please develop a framework,
for our inspiration let us check the
following three frameworks)

7. The big picture
on strategic agility
- excellent framework (Doz & Kosonen)
1. Strategic sensitivity (both the sharpness of perception
and the intensity of awareness and attention)
2. Collective commitment (the ability of the top team to
make bold decisions – fast, without being bogged
down in ”win-lose” politics at the top)
3. Resource fluidity (the internal capability ot reconfigure
business systems and redeploy resources rapidly)

8. The big picture
on leadership
- excellent framework (Kostenbaum)
1. Vision
2. Reality
3. Ethics
4. Courage
Also the graphical version of this framework is excellent

9. The big picture
on innovation How
- excellent framework
(rev. from Moss Kanter HBR nov.2006)
about
1. Strategy
1. Don’t just focus on new product development
2. Transformative idea can come from any function
2. Process
1. Don’t just require that plans are followed
2. Notice deviations which rise from acting in new circumstances
3. Structure
1. Don’t create two classes of corporate citizens
2. Create motivation for all to support innovation
4. Skills
1. Don’t leave innovators alone
2. Find people who create connections

10. Now we know, how we act!
Please propose the action side of your framework!

11. Exercise 2. Let us continue by tackling challenges!
Simple rules in saving money
5 rules for:
-sales
-R&D
-management
-changes

12. Sales:
5 most important rules ina-points
----------------------------------------------------------------------------------
1. Creativity 1,2,3
2.
3.
4.
5.
Evaluate every rule:
-importance (1-10)
-novelty (1-10)
-applicability (1-10)

13. Sales:
5 most important rules ina-points
----------------------------------------------------------------------------------
1. Segmentation (opportunityt to provide effectively right products and services) 9,
2. See the value of the existing customer base (new customers are difficult to get) 10
3. Effective purchase-sales process (active dialoque for the best of the company) ?
4. Help your customer to succeed in its own business (see customer’s customer)
5. Activity (do not press quantity on the cost of quality, eg. number of customer visits) 7
Why the price was not mentioned?
-instead of price try to use other sales arguments, quality, customer care, etc
Evaluate every rule:
-importance (1-10)
-novelty (1-10)
-applicability (1-10)

14. R&D:
5 most important rules ina-points
----------------------------------------------------------------------------------
1. Focus, no-choices are also important 9
2. Get and/or develop the knowledge base what the organization needs 10
3. Openness – see and use all the idea around 9
4. Realism – decide the size of the imput, see also costs and future markets 9
5. Inventive approach, ability to create need (new servise for the customer) 10
How about future needs – need for market research
The existence of the future markets?
How to use previous knowledge/solutions/technology
How to lead innovative group and people
Evaluate every rule:
-importance (1-10)
-novelty (1-10)
-applicability (1-10)

15. Management:
5 most important rules ina-points
----------------------------------------------------------------------------------
1. Sensitivity (herkkyys) 10
2. Willingness to examine and analyze every action (ZBB) (novelty)
3. Manager (ceo) must hae a big picture 10
4. Deep knowledge about the needs of the organization 9
5. Management shapes the culture of the organization – realize the imporance
Management and pet projects?
Short term management positions - consequences
Evaluate every rule:
-importance (1-10)
-novelty (1-10)
-applicability (1-10)

16. Changes:
5 most important rules ina-points
----------------------------------------------------------------------------------
1. How to learn to see the positive side of change (also in Finland) 10-
2. Participation, possibility to propose and get changes 10-
3. Tell the reasons of change to all, often and openly10
4. Rewrds, support, motivation 9
5. Keep it simple 9
Evaluate every rule:
-importance (1-10)
-novelty (1-10)
-applicability (1-10)

17. Joker: what extremely important is still missing
Personnel Group 3
5 most important rules ina-points
----------------------------------------------------------------------------------
1. The feeling of safety
2. The experience of being usefull
3. The experienced appreciation
4. Rewards (many ways, select to most suitable)
5. Fairness
Evaluate every rule:
-importance (1-10)
-novelty (1-10)
-applicability (1-10)

18. Joker: what extremely important is still missing
Personnel Group 4
5 most important rules ina-points
----------------------------------------------------------------------------------
1. How to use the existing capability
2. The role of personnel in cost cutting (their ides)
3. Reward results
4. Motivation, training
5. YT-find the posite side of working together
Evaluate every rule:
-importance (1-10)
-novelty (1-10)
-applicability (1-10)

19. Joker: what extremely important is still missing
Personnel (Group 2)
5 most important rules ina-points
----------------------------------------------------------------------------------
1. Commitment
2. Työ hyvintointi viihtyvyys
3. Motivointi
4. Itsensä johtaminen
5. Vuorovaikutus
Henkilöstöosaston kehittäminen- kaikki edellämaitit asiat niiden
Osaaminen, henkilöstöosaston aseman organisaatiossa
Henkilöstöpäällikön näkyvyys organisaatiolle ja johdolle päin
Evaluate every rule:
-importance (1-10)
-novelty (1-10)
-applicability (1-10)

20. Joker: what extremely important is still missing
Production (Group 1)
5 most important rules ina-points
----------------------------------------------------------------------------------
1. Make the processess leaner
2. Mimimize all distractions
3. Broad and flexible work roles
4. Make sure that key elements of production process are understod in whole organization
Evaluate every rule:
-importance (1-10)
-novelty (1-10)
-applicability (1-10)

21. Joker: what extremely important is still missing
5 most important rules ina-points
----------------------------------------------------------------------------------
1. Creativity 1,2,3
2.
3.
4.
5.
Evaluate every rule:
-importance (1-10)
-novelty (1-10)
-applicability (1-10)

22. Exercise 3. Let us keep up to good work between
seminars by looking deep into our own organizations!
Let us use: name, justify and act framework:
1) What defines your organizations financial success?
Name three most important things:
2) When you know those three justify why those a most imprtant: a brief and
efective backing to your choices.
3) Now you know the most important things and you can justify your views. Is
this enough? – no way. What you do with your knowledge – your actions
(immediately, in a month, in a year)
Prepare a thought provoking presentation for the next seminar
- About 10 minutes most important economic thoughts ever heard so far on
the surface of the earth
- Send this to Ari before 21st of September

23. Exercise 3a. Locate something which could give
new ideas to your colleaque in her effort to
improve her economic thinking (eg. Article, part
of book, video, etc.)
Please send this to Ari before 21st September

24. Talouden Workshop
September 24, 2009
Ari Manninen

25. The big picture
on control
- excellent framework (rev. from Hopwood)
administrative control
control
self control social control

26. Numbers tell a
clear message?

27. Business relevance
Numbers as such are empty, number 9 is just
number 9 nothing more.
We have to notice how our consciusness builds a
picture on the basis of numbers
- Thus our personal experience is the key in
understanding numbers and seeing more than
plain numbers
- Experience is needed
- But we have to be careful with our
intretations – it may be 9 today is
different than tomorrow

28. The big picture on numbers:
=> how do you take these phenomena into account as a responsible manager
How the numbers have changed your How the numbers tell you/your
understanding of youself? boss/management team/sales
representative/welder/shared
ers view/etc. what is wise and what is
en umb u dumb?
Ho w th way yo
to
a ffect st, act,
i
a re, ex How
plan? chan the num
g
orga ed how bers ha
n v
How you/your boss/management poss ization people e
ible s in
team/sales and ee wha your
wha t
representative/welder/shared t is n is
ot?
view/etc. sees the numbers - as
frend/foe/messanger/?

29. The big picture
on uses of numbers
- excellent framework (let us develop together)
why numbers are calculated
what purposes are pursuit with numbers
Emphasis on
knowledge
Emphasis on Emphasis on
action 9 motivating
Emphasis on
…

30. Mental warm up no 1
Customer - Company
What happens between active projects?
Sleeping projects?
Question: what kind of actions are economically wise?

31. Mental warm up no 2
Basic business truth
Sell high
Buy low
Collect early
Pay late
How do you do these things in practice – best practices please!

32. The mental warm up no 3
The big picture on change
Is the truth of organizational life following:
The arrow of time
Same thing continues from time to time.
Do you underwrite the above – to what extend
and where are your reservations?
How would you use reports, numbers and accounting
as a tool for change?

33. Mental warm up no 1:
Cucamber approach
A sad story

34. Business relevance
What this has to do with profit and growth:
general implications
- act in time, anticipate
(see Who moved my cheese)
- notice the small changes
- see the pig picture
=> accounting apparatus notices some changes whereas others remain in
shadow
=> the challenge for the manager is to see all the
most relevant cause-effect relationships in the sense
of the system theory

35. Mental warm up no 2
Milk carton
Best before

36. Business relevance
Our habit as a human being is to repeat
everything – action, thinking, procedures,
ways of learning, ways of organizing,
ways of managing and leading, etc.
This is just fine – life without routines would
be impossible, it would take time to decide
which food would be best to take first out
of the bed.
But the world changes all the time…
We need best before days for…

37. The big picture on numbers:
=> how do you take these phenomena into account as a responsible manager
How the numbers have changed your How the numbers tell you/your
understanding of youself? boss/management team/sales
representative/welder/shared
s
u mber view/etc. what is wise and what is
the n y you dumb?
How to wa
t
affec ist, act,
x How
ar e, e chan the num
plan? g
o rg a e d h o w b e rs h a
n v
poss ization people e
How you/your boss/management ible s in
and ee wha your
team/sales w ha t
t is n is
representative/welder/shared ot?
view/etc. sees the numbers - as
frend/foe/messanger/?

38. Mental warm up no 4
Accounting world
Double – entry bookkeeping
Let us experiment with accounts
Transactions not actions
Let us look the continuum between company and customer
Entity
What is the scope, what do you manage
-unit, organization, network
No one few Management + some network
Who is interested in your success – a continuum of leadership
(who is willing to to do something (extra) for you)

39. Business relevance
transaction - actions
Customer - Company
No connection
with the customer Time
Send an invoice
What are the most important moments/acts in this continuum?

40. Path to Profit - Framework
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41. Big Picture
What are the underlying explanations for Company’s
financial success?
Question:
Please name three underlying explanations and give some
justification for your choises
Do people have a shared view?
Do you really use your identified strength in a best possible
way – is the leverage in active use?
Do you nourish your strength?

42. Direction
Do you know the direction where to proceed?
What role accounting plays here – please elaborate?
What do you select to do and what do you select not to do?
Question:
Do you have ways to recognize declining areas (products,
customer groups, procedures etc.) and act accordingly?
Please tell us an example?

43. Technology
Do you have tools to manage economic
activities? You certainly have ways to
continuosly increase your
business intelligency
-What role accounting reports
and numbers play in this
process of becoming wiser?
-Please tell us an example
where accounting reports
have changed your (your
colleaques) conception/
action?

44. Technology..more questions
Do you have necessary tools to manage economic activities?
What is the major task for accounting, cost accounting, strategic
accounting, etc. in your organization?
What are those specific accounting tools which seem to be most
important in helping your organization to succeed?
How do you use your accounting technology? Best examples
please.
Do you think that there are important issues in your
organizationg which remain into shadow and
what may be the important issues which escape inquiring
accounting eye?

45. Motive
Who are willing to make the organization to succeed?
Look the continuum (from – to whole network and beyond)?
How do widen and deepen the willingness to make more for
the organization’s success?
Question:
When we look the world with the eyes of different people in
different positions – how do they see the issue of
organization’s success?
How the incentive system works – what is in order what
might need some refinement?

46. Food for thought
- Can you locate unnecessary expences?
- And if yes – are you willing and/or able to
something
- What is the route from knowing to doing?
- Are customers willing to do selling for you?
- Or can you name some orher potential
resources which you do not leverage as
efectively than what would be possible
- Is something stalling your action here?

47. Motto
• Best time to plant a tree was ten years ago.
The second best time is now.
– The message is: intensify the present moment
– And see how past, present and future and
irrevocably linked with each other

48. Reading
• Accounting in action:
two lines of thought
1) Strategy
Is It Time to Start Thinking About Strategic Accounting?
2) Organisational, behavioral
Be(com)ing The Chief Financial Officer Of an Organisation:
Experimenting With Bourdieu’s Practice Theory

49. Before we go go there is
absolutely something we
must not ignore…

50. What it is?
The thing that has changed the
world and does just keep on
going..
causing deeper and more profound
changes all the time
continuously everywhere…

51. The answer is
Internet
Web 2.0 youtube wikinomics
Blogs, wikis, chat rooms, etc…

52. Groundswell: Li and Bernoff
You must always thing how
internet could help you to:
1) Listen your customers and your shareholders –
better and with lower costs
2) Talk to your customers and shareholders-
better and with lower costs
3) Energize your most loyal customers and shareholders-
better and with lower costs
4) Support your customers and shareholders
help each other
5) Embrace your customers and shareholders
to develop your business together

53. Please share with us your adventures in internet,
in particular those with remarkable financial
successes or losses
Where and how - in your experience - the
business relevance of internet use in business
environment has been most impressive?
Have you seen enormous rise of revenues or
amazing fall on costs?
What
should
we look
closely in
the near future?

54. You made excellent questions and I have
grouped responses into three category:
1) Bridge-work between strategy and finance (accounting,
control)
2) Innovations in the accounting, control world
3) Bacis question: how strategic position is developing
4) Steps in Strategy work and accounting

55. Bridge-work between
strategy and finance (accounting, control)
How we see the concept and activity of strategy
affects how we can build the bridge. Is strategy:
1. Process through which we develop the organization to fit to the external situation
2. Meticulous planning process and forceful implementation act
3. Improvement of our position within the context of industry
4. Visionary process of the charismatic leader
5. Our capability to see and understand opportunities for our organization
6. Learning process
7. Negotiation process between differeant stakeholders within and outside the organization
8. Gradually emerged way to think and act – our culture
9. Our way respond to the challenges what the external environment impose on us
Cf. Mintzberg et al. Strategy safari
How these conceptions of strategy path
a way to accounting and control?

56. Bridge-work between strategy and finance (accounting, control)
When we perceive strategy as: 1) Process through which
we develop the organization to fit to the external situation
Then our article which was given as a reading material ”Is It Time to Start Thinking
About Strategic Accounting? is highly relevent:
… well, because
There is the idea and wisdom: Ansoff ssf
(strategic success formula)
in case we accept the idea (or find it usefull)
everything follows pretty straightforwardly, so
in case the environment is 1) repetitive, 2) expanding,
3) changing, 4) discontinuous, 5) surpriseful
⇒This tell something what the firm should be and
⇒How the environment should be monitored
⇒What kind of accounting and control system
would serve us best

57. Bridge-work between strategy and finance (accounting, control)
When we perceive strategy as: 2) Meticulous planning process and forceful
implementation act
In case this is our starting point what does this mean to our way to perceive and
develop accounting and control systems?

58. Bridge-work between strategy and finance (accounting, control)
When we perceive strategy as: 3) Improvement of our position within the
context of industry
In case this is our starting point what does this mean to our way to perceive and
develop accounting and control systems?

59. Bridge-work between strategy and finance (accounting, control)
When we perceive strategy as: 6) Learning process
In case this is our starting point what does this mean to our way to perceive and
develop accounting and control systems?

60. Bridge-work between strategy and finance (accounting, control)
How we see the concept and activity of strategy affects how we can build the bridge.
Is strategy essentially:
Cf. Stacay and Griiffin
1. Essentially codified and centralized
- managers, decisions, hierarchies
2. Complex responsive process in organization
- created in continuous discussions between people
How these basic conceptions of strategy affect to the way how
we start to think accounting, control and our task as a manager
to create a setting which lead to a success?
Eg. How we start to think about intangible assets, their
management and measurement

61. Innovations in the
accounting, control world
Point to consider
Is the world and organizations truly changing to a direction where hierarchies, bosses and
structeres are less important and powerful?
Are we moving to world where substance and contribution matter? The one who has
something to say gets audience, the one who can deliver gets resources, etc.
Is there a good reason for Stacey to say that there is no boss neuron
in a brain?
Is these a good reason for Hamel to talk about resielence and quite
often refer for instance to cities as resilien organizations?
What would this change mean to accounting and control?

62. Innovations in the
accounting, control world
Few remarks from history and from the outskirt of accounting
1. Excellent tools: ROI (profit centers, the story in GOAL)
2. Radical innovation: Exit value accounting (Sterling)
3. Recent shock wave - subprimes

63. Innovations in the accounting, control world:
case Balanced Scorecard
How the performance of an organization changes? What changes first and things
are related to each other? Let us hear first the BSC story and then your stories
Profitability
Customer satisfaction
Knowledge

64. Innovations in the accounting, control world:
Outline your own Balanced Scorecard
What are your strategic goals? How do you pursue your goals? What is the
elementary level, the sencond and third level?
Third level
Second level
Elementary level

65. Bacis question: how strategic position is developing
1. Very basic level
- Naked eye
2. Basic level
- Counting
3 And what comes here…

66. Basic question:
If you want to know more of your organization
than what naked eye or simple counting can tell
you need theoretical frameworks
Some of our frameworks have received an established position:
Accounting tools (income statement, balance sheet and so on
also eg. Budgeting, Balances Scorecrs, etc.)
However some frameworks are still lacking or they are
Controversial. For instance how to know how the strategic
Capability of organization is developing. Also hard question is
Personnel – what to follow and why – what is the framework here?

67. Steps in Strategy work and accounting:
What role accounting plays and can play in each step
Create strategy,
choices
accounting
Implement strategy
monitor
Evaluate strategy,
Change if necessary

68. Your own framework
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69. Your comments
Name, topic Your comment – the key point i n a