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European
Business
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January - February 2016
europeanbusinessreview.com
The Appearance of
INNOVATION
Page 18
Design, When
Everybody Designs
Collaborative Innovation
Driver of Growth
The European
Business Review
empowering communication globally
Innovation
10
18
22
Strategy
27
34
Change as Strategy
Walter McFarland
41
Risk
46
Marketing
52
Leadership
58
Female Leaders
66
Management
73
Technology
77
80
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to be banned from the US. Trump is unrepentant, despite the UK, Irish and Scottish
Parliaments entertaining motions to ban
him from their shores. But what about the
Mexicans, the Muslims who have been maligned by the free speech of the potential
leader of the free world?
And not to be left out, Charlie Hebdo, in
its inimitable style, and as the grand patron of
that sacred order, trots out its latest expression in the first week of the New Year with
a cartoon depicting the body of the drowned
Syrian boy, Aylan Kurdi, lying face down in
a puddle of water, accompanied by: "What
would have become of the young Aylan if
he had grown up? A groper in Germany." It
seems that in its zeal, to spread its message,
(whatever the message, because it seems it is
now lost on its many admirers who donned
I am Charlie Hebdo t-shirts following the
January 2015 attack), Charlie Hebdo discounted the pain of the father and the family
of Aylan Kurdi who are still alive and still
mourning the loss of Aylan and many other
members of their family. Is the family to pay
for the sins of others?
Charlie Hebdos freedom to use the image
of a drowned child to drive home its message,
whatever that may be, is paid for, by thousands
of innocent young lives who by virtue of its
brush are robbed of their right to dignity, aspirations and security. Charlie Hebdos latest
offering serves to promote fear and loathing.
The satire is long gone!
www.europeanbusinessreview.com
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Innovation
COLLABORATIVE INNOVATION
AS ULTIMATE DRIVER OF GROWTH
BY MARK ESPOSITO AND TERENCE TSE
10
As entrepreneurship
has long been
regarded as a path
for economic growth,
entrepreneurship has
been proposed as a
specific course of action
to address Europes
economic woes.
and market innovations gained from collaborative innovation. However, collaborative innovation comes with its own set of challenges, which
the researchers at the World Economic Forum
DQG$7.HDUQH\KDYHGLYLGHGLQWRYHFDWHJRries. We will describe each of these challenges
in turn, along with ways to overcome them, followed by ideas on the role that policymakers can
play to help facilitate collaborative innovation.
FIVE CHALLENGES TO
COLLABORATIVE INNOVATION
7KH YH FKDOOHQJHV WR FROODERUDWLYH LQQRYDWLRQ
are: 1. understanding the business case for collaborative partnerships; 2. utilising the full poWHQWLDORI QHWZRUNVFRQVWUXFWLQJH[LEOHSDUWQHUVKLSVWUXFWXUHVGHQLQJPXWXDOO\EHQHFLDO
intellectual property (IP) agreements; and 5. preparing management and employees for shifts in
company culture in a collaborative environment.
www.europeanbusinessreview.com
11
Innovation
12
understand the goals of collaborative innovation and have themselves the capacity and networks to make the right connections and play
the role of mediator. Partnerships within such
a network also foster a commitment and responsibility to achieve goals so as to protect
those relationships. Ultimately, the networks
should form an ecosystem within which each
actor is part of an interconnected value web.
Additionally, joining and reinforcing the
capacity and effectiveness of already existing innovation-centric networks and ecosysWHPVZLOODLGVRPHUPVLQGHYHORSLQJDQGLPproving partnerships. EIPs, or European
Innovation Partnerships, a European
Commission initiative, are one place
ZKHUHVPDOODQGHVWDEOLVKHGUPVFDQDGG
to the diversity of actors seeking mentorship, partnership, and better coordination of
resources and participants.4 &RQYHUVHO\ D UP
may elect to create their own formal ecosystem.
One example is Lufthansa. With their headquarters based in Cologne, Germany, the company
decided to start a unit called the Lufthansa
Innovation Hub in Berlin, where there is a
bigger startup scene. Using the power of their
own reputation as a technology giant to attract
entrepreneurs and startups, the Lufthansa
,QQRYDWLRQ +XE VFRXWV VSHFLFDOO\ IRU WUDYel-oriented tech startups with the intention to
co-create new products and services, and also
to gain knowledge on startup tech technology
trends for the main corporation.5 Networks, for
ERWK\RXQJDQGHVWDEOLVKHGUPVDUHDQLPSRUtant factor for collaborative innovation, whether
it is drawing upon the aid of colleagues, creating
an innovation ecosystem, or adding value to an
existing network or ecosystem.
www.europeanbusinessreview.com
13
Innovation
Economic Forums research indicate that corporate attitudes toward IP negotiations were perFHLYHGE\KHDGVDWWKHQHZUPVWREHXQIDLU
leading to a breakdown in goodwill and unwillingness to continue open collaboration in the
ORQJHUWHUP(VWDEOLVKHGUPVVKRXOGDWWHPSW
WRXQGHUVWDQGWKH\RXQJUPVSRLQWRI YLHZ
when negotiating IP agreements or even
share their own technology. In the case of
pharmaceutical industries, companies like
Eli Lilly & Co. licenses drugs to startups with
an option to buy back the drug if they successfully pass some clinical trials.
2WKHUZD\VWKH\RXQJUPFDQIHHOLQFRQWURO
established
a formal relationship with of their IP is to document interaction. Informal,
GE when they needed a partner oral conversations should be summarised in
to manufacture their product.7 In writing after discussion to provide clarity on the
summary, partnership structures should information shared and evidence in the case of
be able to minimise risk while taking advan- DQ ,3 GLVSXWH (QWUHSUHQHXULDO UPV FDQ DOVR
protect themselves by having experienced and
WDJHRI HHWLQJPDUNHWRSSRUWXQLWLHV
Moreover, the level and type of collabora- sophisticated investors and members on their
tion will also depend on the industry and the board of directors. Governance controls, mademands of technology development. For in- terial transfer agreements and restrictive covestance, capital-intensive industries may choose nants should all be reviewed and approved by
to focus on early-stage collaboration so that WKHERDUG,3DQGVSHFLFDOO\,3SURWHFWLRQLV
they may test and assess technologies on their SURJUHVVLYHO\EHFRPLQJDSOD\LQJHOGIRUFRPinternal platforms before moving on to invest petitors. While successful IP litigation can genmore on a potential innovative technology. A erate licensing revenue for companies and enconsortium approach as opposed to a collab- feeble competitors, such as in the case of Apple
oration between just two companies, a young versus Samsung, using IP protection as competUP DQG DQ HVWDEOLVKHG UP LV OHVV QLPEOH itive and comparative advantage runs counter to
and thus makes more sense only in particular in- advancing innovation and cooperation.
,Q (XURSH WKHUH LV DQRWKHU VSHFLF VHW RI
dustries where the level of complexity requires
challenges in IP protection. With the excepmore than two companies to innovate.
Finally, time should also be a factor in the tion of startups in the UK, web startups cannot
structure. Innovation takes time to make an patent text and datamining (TDM) inventions
impact, and established companies should con- under European national copyright legislation.
centrate their capabilities and resources on how This means that startups are limited to treating
their software and algorithms as trade secrets,
to scale up impactful innovations.
which have virtually no legal protection. With
the increase of human capital movement across
4. Defining Mutually Beneficial Intellectual
borders and higher risk of compromised IT
Property Agreements
2QFHD\RXQJUPKDVGHYHORSHGLWVLQWHOOHFWX- systems, safeguarding trade secrets is an unrelial property to a point where it has value, how able way of protecting intellectual property.
to share its value becomes an issue in a collaborative innovation partnership. Entrepreneurs 5. Preparing Employees for Shifts in
LQ \RXQJ UPV VHH ,3 DV WKHLU PRVW LPSRUWDQW Organisational Culture
DVVHWZKLOHHVWDEOLVKHGUPVYLHZHYHU\WKLQJDV Culture is an important component in collabfor sale. Interviews conducted during the World orative innovation. Attempting to merge two
14
rather than discourage collaborative innovation. For instance, patent registration is one area where policymakers
can have a substantial effect for innovation. Patent costs are
too high; patent attorneys and translation make up 94-99%
of the cost; one way policy can lower costs is through simplifying the system and harmonisation. To create a multigenerational entrepreneurial outlook, policymakers can also
use the classroom setting to create future entrepreneurs by
teaching them the fundamentals of starting a business as
well as how to become comfortable with risk-taking and
with the possibility of failure.
CONCLUSION
7KHJUHDWHVWFKDOOHQJHIRU\RXQJUPVDQGFROODERUDWLYHLQnovation is in choosing the right partners. This may mean
SDUWQHULQJZLWKVHYHUDOUPVDVORQJDVWKH\RXQJUPGRHV
not stretch itself so much that it has trouble managing either
LWVSDUWQHUVKLSVRUUHVRXUFHV4XHVWLRQVD\RXQJUPPD\DVN
to help them select partners include how a potential partner
FDQ DLG WKH UP LQ UHDFKLQJ LWV JRDOV DQG ZKHWKHU RU QRW
there are many barriers to getting started. Additionally, young
UPV PXVW QRW XQGHUHVWLPDWH WKH VNLOO DQG LQYHVWPHQW RI
time it takes to build and access networks. Although larger
corporations may have more leeway in choosing partners iniWLDOO\D\RXQJUPZLOOKDYHPRUHOHYHUDJHRQFHLWGHYHORSV
its own value proposition.
)RUFROODERUDWLYHLQQRYDWLRQWRKHOSWKHHVWDEOLVKHGUP
meet its business goals, commitment from top management
LV LPSHUDWLYH $GGLWLRQDOO\ WKH HVWDEOLVKHG UP VKRXOG VWD\
aware of any tendency to slip into attempts to assimilate the
VPDOOHUUPLQWRWKHODUJHUUPDVLWZLOOJRDORQJZD\IRU
the partnership the startup needs to maintain creative mentality and entrepreneurial drive that is necessary for innovaWLRQEXWHDVLO\GLOXWHGLQDODUJHUUP7UXVWVWUXFWXUHDQG
comprehension of the strategic goals that each partner strives
to gain from collaborative innovation is key to working together and creating value.
PUBLIC POLICY CAN AID COLLABORATIVE INNOVATION
Collaborative partnerships are meant to be mutually
Public policy can help spur collaborative innovation by proYLGLQJH[LELOLW\WRPDUNHWV)RUEXVLQHVVHVWRWKULYHSXEOLF EHQHFLDO\RXQJUPVJDLQDFFHVVWRJOREDOQHWZRUNVDQG
policy should provide a framework that facilitates busi- resources while large companies gain new knowledge and
nesses ability to run smoothly. In order to create the right potential new markets to drive their own renewal process.
framework, creating a conversation with multiple stakehold- *LYHQWKHLQQLWHVFHQDULRVDQGQHHGVWKHLGHDRI FROODEers will provide the necessary perspective on what business- RUDWLYH LQQRYDWLRQ LV DERYH DOO WR EH H[LEOH DQG RSHQ
HV QHHG VXFK DV VFDO DQG OHJDO VWUXFWXUHV WKDW HQFRXUDJH about possibilities.
Building trust goes a long way toward developing the potential of the partnership. The first step
towards doing so is to work together to find common ground on the vision and strategic goals in
the next three to five years that first made the case for partnering together.
www.europeanbusinessreview.com
15
Innovation
The greatest
challenge for
young firms and
collaborative
innovation is in
choosing the
right partners.
16
http://thenextweb.com/microsoft/2013/06/25/harmonizedunder-the-name-microsoft-ventures-microsofts-startup-activity-set-to-rise-with-increased-investment-3-new-accelerators/.
7. Parmar, Arundhati. GE Healthymagination Fund looking
for startups to invest in. http://webcache.googleusercontent.
FRPVHDUFK"T FDFKH,38+U-F-KWWSVZZZNDXIIPDQ
org/resource-center/ge-healthymagination-fund-looking-forstartups-to-invest-in.aspx+&cd=1&hl=en&ct=clnk&gl=us.
References
1. Butler, David. From Startup to Scaleup: the Next Wave of
Innovation. August 6, 2013. http://www.coca-colacompany.com/
innovation/from-startup-to-scaleup-the-next-wave-of-innovation.
2. Butler, David. Startup Refreshed: Why Coke is Joining the
Entrepreneurial Revolution. May 30, 2013. http://www.coca-colacompany.com/innovation/startup-refreshed-why-coke-is-joining-the-entrepreneurial-revolution.
3. The Coca-Cola Company. Coca-Cola Founders. http://coca-colafounders.com/.
4. The Economist. Apple versus Samsung: Copy That. August 25,
KWWSZZZHFRQRPLVWFRPEORJVVFKXPSHWHU
apple-versus-samsung.
5. European Commission. European Innovation Partnerships.
http://ec.europa.eu/research/innovation-union/index_en.
cfm?pg=eip.
6. GE Healthcare. About healthymagination. http://
healthymagination.gehealthcare.com/en/about.
7. General Electric. Healthymagination | GE.com. http://
www.ge.com/about-us/healthymagination.
+XJKHV -RQDWKDQ DQG :HLVV -HII 6LPSOH 5XOHV IRU 0DNLQJ
Alliances Work. Harvard Business Review, November 2007. https://
hbr.org/2007/11/simple-rules-for-making-alliances-work.
9. Jarvis, Lisa M. Licensing Out. Chemical and Engineering News
vol. 92:12, March 24, 2014.
10. Krasny, Jill. 6 Companies That Want to Invest in Your
Startup. Inc.com. February 14, 2014. http://www.inc.com/jillkrasny/six-companies-that-want-to-invest-in-your-startup.html.
10. Kurtz, Nathan. Microsoft Ventures: The Original Startup
Goes Back to Its Roots. Entrepreneurship. http://www.entrepreneurship.org/resource-center/microsoft-ventures-the-original-startup-goes-back-to-its-roots.aspx.
11. Lufthansa Group. Co-creation hub. http://hub.lh.com/.
12. Lufthansa Group. Lufthansa Group unveils raft of
quality and innovation actions. July 9, 2014. http://www.
lufthansagroup.com/en/press/news-releases/singleview/
archive/2014/july/09/article/3077.html.
13. Meisner, Jeffrey. Announcing Microsoft Ventures for startups to build, innovate and grow. Microsoft. June 25, 2013. http://
blogs.microsoft.com/blog/2013/06/25/announcing-microsoftventures-for-startups-to-build-innovate-and-grow/.
14. Miller, Ron. Coca-Cola Hopes Its Startup Incubator
Is The Real Thing. TechCrunch. November 10, 2014.
http://techcrunch.com/2014/11/10/coca-cola-hopes-itsstartup-incubator-is-the-real-thing/.
15. Parmar, Arundhati. GE Healthymagination Fund looking for
startups to invest in. http://webcache.googleusercontent.com/
VHDUFK"T FDFKH,38+U-F-KWWSVZZZNDXIIPDQRUJUHsource-center/ge-healthymagination-fund-looking-for-startupsto-invest-in.aspx+&cd=1&hl=en&ct=clnk&gl=us.
16. Van Gool, Lorenzo. Google-backed Factory Hub and
Hardware.co Accelerator coming to Holland. Startup Juncture.
February 17, 2015. http://startupjuncture.com/2015/02/17/
google-factory-hub-hardware-co-accelerator-holland/.
17. Wilhelm, Alex. Microsoft brings BizSpark, Bing Fund, and
its accelerators under one roof. The Next Web. June 25, 2013.
http://thenextweb.com/microsoft/2013/06/25/harmonizedunder-the-name-microsoft-ventures-microsofts-startup-activity-set-to-rise-with-increased-investment-3-new-accelerators/.
:RUOG (FRQRPLF )RUXP &ROODERUDWLYH ,QQRYDWLRQ
Transforming Business, Driving Growth. World Economic
Forum, 2014.
Aargau is a canton of technology, energy and culture. It offers an overall package that is
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1. Cost advantages
Below-average tax rate, moderate wages and low
real estate and property prices.
2. Perfectly developed in the heart of Europe
The canton of Aargau is situated in the strongest
Swiss economic region, in between Zurich, Basel,
Bern and Lucerne.
3. Concentrated high-tech know-how
In Aargau, there are highly qualified specialists
in the high-tech industries of energy, electrical
engineering, life sciences, medical technology,
plastics, ICT and mechanical engineering.
4. High quality of life
Anyone who appreciates nature experiences
and cultural highlights feels at home in Aargau.
You can find an outstanding educational
system, innumerable leisure activities and many
local recreational areas for the whole family.
Innovation
The Appearance
of Innovation
BY ALESSANDRO DI FIORE, ELISA FARRI AND ANDREA SEGNALINI
Look at Salesforce.com, the San Franciscobased CRM company. According to the 2015
Forbes Most Innovative Companies ranking,
6DOHVIRUFHKDVDSHUFHQW,QQRYDWLRQ3UHPLXP1
ppearances are important. Look at lead- This is almost double the industry average. Why?
ership. How a leader looks and behaves Salesforce not only has an innovation track
in front of followers is key to the suc- record, but also a strong reputation as innovacessful practice of leadership. But, while we tor. Marc Benioff, its CEO and founder, has sucaccept the importance of appearances in a range cessfully marketed the companys innovativeness
of business disciplines marketing and com- across different channels. It is an innovative ormunication for example in some it is strange- ganisation, but it also looks like one.
The reality is that innovation is a battle that
ly under-valued.
Consider innovation. Companies invest in in- has to be fought on two fronts. First, companies
novation to foster growth and competitiveness. have to develop their innovation capabilities.
This hopefully results in a higher Innovation Building long-lasting capabilities throughout the
Premium the difference between the market organisation lays the foundation for enduring
FDSDQGWKH139RI FDVKRZV%XWZHZHUH innovation and growth. Today, most companies
surprised when our research into the Innovation XQGHUVWDQGWKHLPSRUWDQFHRI WKLVUVWOHYHUWR
Premiums of major corporations found that sustain future performances. The real challenge
WKH\ YDU\ VLJQLFDQWO\ DPRQJ FRPSDQLHV ZLWK here concerns execution.
The second front is the world of appearancWKHVDPHQDQFLDOIXQGDPHQWDOVHYHQZLWKLQWKH
es. Compared to developing innovation capasame industry.
We then examined what differentiated these bilities, innovation marketing is neglected. But,
companies. We found that where companies our research suggests that it is vital. Investors
differ is primarily in their ability to explain to in- need to be informed and convinced of a comvestors that they can sustain innovation. In inno- panys ability to continue to innovate far into the
vation, reputation is crucial; being seen to be inno- future. This means being able to build a thought
OHDGHUVKLS SUROH RQ LQQRYDWLRQ EH NQRZQ
vative is a vital differentiator. Seeing is believing.
Investors need to
be informed and
convinced of a
companys ability to
continue to innovate
far into the future.
18
WKH RSSRVLWH +DYLQJ D ORZ SUROH VSHDNing only through results, avoiding visibility
are the norms. We found that having a reVHUYHG FXOWXUH LQXHQFHV WKH VW\OH DQG LQtensity of a companys communication with
the outside world. Take the fast moving consumer goods industry. On one hand, there
is P&G. Its culture can be described as egopowered, self-centric, show you are the best.
It has built a reputation and image on innovation through articles, books, case studies
and research studies. It comes naturally to
P&G to spend time, resources and effort
to let the world know how great it is. On
the other hand, Colgate-Palmolive has a reserved culture and it doesnt come naturally
for the company to invest time and resources to boost its innovation reputation beyond
the standard corporate actions (annual
UHSRUWV QDQFLDO URDG VKRZV DQG VR RQ
/DFN RI DFFRXQWDELOLW\ Often, there is no clear
accountability for innovation marketing. The
&KLHI ,QQRYDWLRQ2IFHUDQGWKH5 '93
are responsible for driving the companys innovation funnel and priorities. Innovation
marketing is not part of their individual goals and targets. The CFO and Investor
Relationship Manager are focused on
Innovation Marketing
Three Main Barriers:
1
Obsession with
confidentiality and privacy
2
Reserved company
culture
3
Lack of accountability
www.europeanbusinessreview.com
19
Innovation
Prestigious and
quality publications
To create thought
leadership,
companies need
to design a
clear Innovation
Marketing plan that
states what the
company should do.
20
Those are examples of good activities which fits well the four levers
of our suggested framework. If those activities and eventual future ones
will have a concrete impact on the BASF Innovation Premium should be
monitored in few years from now, considering that the program is still
running. In fact, in our experience only companies with long term commitment and multi-year programs of Innovation Marketing are able to
generate sustainable Innovation Premium in their equity stories.
www.europeanbusinessreview.com
21
Innovation
In a fast and profoundly changing world everybody designs. The result of this diffuse
designing is that society as a whole can
be seen as a huge laboratory in which new
social forms, solutions and meanings are
produced. These transformative activities
require unprecedented economic models
and courageous design choices.
22
production and on seasonal and proximity consumption. Other examples could be: forms of
mobility in alternative to individually owned
cars; social services conceived as collaborative
activities; models of housing and neighbourhood living better geared to the current reality
of family life; activities aimed to redevelop the
social and environmental quality of cities. The
list could continue.
Looking at these examples more closely we
can see that, diverse as they are, they share a
fundamental characteristic: while solving speFLF SUREOHPV WKH\ DOVR SURGXFH VRFLDOLW\ DQG
thus contribute to rebuilding the social fabric)
and new qualities (thus contributing to the production of new value systems). In short, they
can be considered as experiments in new ways
of thinking and doing things: working prototypes of a sustainable everyday life.
Given this short overview on social innovation towards sustainability (to which, from here on
, ZLOO UHIHU WR VLPSO\ DV VRFLDO LQQRYDWLRQ, I can now
move to design and to describe the possible interactions between the two.
Diffuse and Expert Design
7KHUVWREVHUYDWLRQWREHGRQHLVWKDWDV,
YH
mentioned in the introduction, the social innovation I'm talking about can be described
as an interweave of co-designing activities. So
all those who foster social innovation, though
in very different and differently commendable
ways are also actors in complex, and frequently
contradictory, co-design processes. In effect, it
is easy to note that an awareness of the need to
adopt a design approach, and consequently also
design tools, has been spreading in recent years.
For example, the expression design thinking has
recently been meeting with success worldwide,
impacting on social enterprise and the institutions. However, we can go further.
This diffuse design (i.e. the design as a diffuse
human capability) is not the only form in which
WRGD\GHVLJQLVDSSHDULQJ:HFDQQGLWDOVRLQ
a second form, the one of the expert design: the
design performed by who has acquired special
skills and tool, becoming a design expert.
Precisely because everybody designs, it becomes
useful and even necessary for someone to help
them to do so, someone equipped with the cultural and practical skills required to integrate and
promote the design abilities of the others, the
non-experts. This means someone who is expert
in the various ways of stimulating and supporting wider, more complex co-designing processes.
Emerging Design
In a rapidly and profoundly changing world, the
activity conventionally known as design has
also changed. And like everything else, it has
changed much more than the cultural categories
normally used to interpret it have evolved.
To cut a long story short, we can say that
design as a discipline and profession, which here
we are calling expert design, emerged at the beginning of the last century in relation to the
changes brought by industry. The result was that
LWV LQLWLDO GHQLWLRQ ZDV WLHG WR ZKDW DW WKDW WLPH
was making it necessary: industry as it was then
and the products it was generating. So, design was
mainly seen as industrial design and was associated with mass-produced industrial products.
3
Design and
Technology
Agency
Design and
Communication
Agency
problem
solving
sense
making
Grassroots
Organisation
Cultural
Activists
2
diffuse design
A Design modes map can be built considering two main design dimensions:
the actors and competence axis, which moves from diffuse design to expert design
the motivations and expectations axis, which moves from problem solving to sense making.
By crossing these tow axes, we obtain four quadrants, each of which proposes a characterising
design mode. This map also indicates the various ways of putting designing capacity into action, the
different ways of designing and being designers.
www.europeanbusinessreview.com
23
Innovation
24
precise I should name it design for social innovaWLRQ WRZDUGV VXVWDLQDELOLW\. But lets assume that,
from here on, writing design for social innovation I will always refer to the one oriented
towards sustainability).
Design for Social Innovation.
From this introduction it is clear that the design
(both diffuse and expert) that is involved in the
social innovation processes is quite far from the
idea of design that has been prevalent in the
past century.
The recognition of this difference is crucial:
to understand the possible relationships between
design and social innovation we have to, as a
precondition, understand how much design has
changed in the past decades. If we cling to the
GHQLWLRQ RI th century design, as too often
happens, we cannot hope to understand how
GHVLJQ FRXOG RSHUDWH DQG SOD\ D VLJQLFDQW UROH
in social innovation and in steering it towards a
sustainable future.
:KHQ WKLV SUHFRQGLWLRQ LV JLYHQ WKH GHQLtion of design for social innovation becomes
quite simple: it is everything that design can
do to foster and support social innovation, to
make its results more widely accessible and its
meaning richer and deeper.
:LWK WKLV GHQLWLRQ LW DOVR EHFRPHV VLPSOH
to observe that design for social innovation is
not a new design discipline. Rather, it is a new
ability that can be extended to all the designing
actors: the ability to recognise the most promising social dynamics and work with them.
In this framework, very different kind of design
initiatives can be considered as design for social innovation. To give a general overview of them, we
can group them in three main typologies:
Design activism, when design experts actively
promote social innovation.
Design with communities, when design experts
collaborate with active groups of people in
making a given solution more accessible and
more capable of lasting in time.
'HVLJQ IRU IDYRXUDEOH HFRV\VWHPV, when design
experts conceive and develop material and immaterial artifacts capable of making a whole
eco-system more favourable for new initiatives
WRHPHUJHRXULVKVSUHDGDQGFRQQHFW
www.europeanbusinessreview.com
25
EXECUTIVE
EDUCATION
innovative
leadership
execed.wharton.upenn.edu/LEAD
Strategy
Feature
rian and his team had come up with their new strategy, after several months of vision setting, market analysis and detailed feasibility studies. Now he needed
to ensure he had a structure that was capable of supporting
the delivery of their new business plan. At this point many
UPV UHDFK IRU WKH WULHG DQG WHVWHG OLQH VWUXFWXUH EDVHG RQ
a clear hierarchy. But that would not have given Brian what
KH QHHGHG 6R KH VHW DERXW GHVLJQLQJ LW IURP UVW SULQFLSOHV
using the six guidelines laid out here.
1. Structure Follows Strategy
The purpose of structure is to organise your resources in such
D ZD\ WKDW \RX DUH DEOH WR GHOLYHU \RXU VWUDWHJ\ 6R WKH UVW
guideline is to ensure you have coherence of direction before
embarking on the journey to determine your structure. Tick in
the box for Brian and his team here. You must be able to articulate what the structure has to enable in order to build an effective organisation. If, for example, you plan rapid growth or
International expansion your structure must be able to scale
and cope with multiple time zones. If you need to bring in innovation, into a traditional structure, something will have to
VKLIW LQ WKH GHVLJQ WR HQDEOH LQQRYDWLRQ WR RXULVK RU LW ZLOO EH
suffocated at birth by bureaucracy. You could be forgiven for
thinking that structures are independent of strategy, when you
consider how many businesses trot out similar versions of the
traditional line structure despite having diverse aims and purposes. It saves brain work to reach for the usual line diagram
EXW WKH UHDOLW\ LV WKDW RQH VL]H GRHV QRW W DOO LQ WKH ZRUOG RI
structural design. It pays massive dividends to get the structure
W IRU WKH SXUSRVH RI \RXU YHU\ VSHFLF EXVLQHVV
2. Structure Must be Aligned with Values and Espoused Culture
<RXU VWUXFWXUDO GHVLJQ ZLOO OLH DW WKH FRQXHQFH RI \RXU LQtentions on strategy, values and culture. If your value statements are ever going to be more than just aspirational words
on a page, and you want to turn your espoused culture in
tangible behaviour, this will have massive implications for
your structural design work. If your stated value is to be
'customer focussed' but your organisational design is all internally orientated and lacks an external radar then you are
building a fundamental clash of values into your structure
and the outcome will be confusion. If you claim that your
workforce is your key asset, but your organisation is driven
by compliance and control, you will end up with dispirited
employees and high churn. Effective structures bring clarity
so that everyone can quickly understand how they are to act
27
Feature
Wherever you
have a line
drawing with
a multitude of
dotted reporting
lines you can
safely assume
that hierarchy
is the wrong
organising
THE HIERARCHICAL LINE STRUCTURE
principle for
Let's start with the one we all know. Here the or- your firm. Time
ganising principle is positional authority. I am in
to move on.
charge of you and you are in charge of them.
The vast majority of organisations assume that
their new structure will be some variant of a hierarchical organisational chart. This became
popular in the days of the 'mill owner' industry, where there was a clear boss who (hopefully) knew more than everyone else about what
to do and how best to do it. But few organisations today have a boss who knows more or can
perform better than their 'subordinates'. In fact
many managers pride themselves on their ability
to hire people who are better than themselves.
Recently, line structures have developed
GRWWHG UHSRUWLQJ OLQHV LQ DQ DWWHPSW WR UHHFW
the more complex organising patters that are
actually at play than a simple command and
control chart can convey. Wherever you have a
line drawing with a multitude of dotted reporting lines you can safely assume that hierarchy is
WKH ZURQJ RUJDQLVLQJ SULQFLSOH IRU \RXU UP
Time to move on.
CEO
TECH
OPS
SALES
FD
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29
Strategy
Finance
les
ns
Sa
isio
Customer
Technical
Ope
n
keti
rati
ons
Mar
30
Customer Doughnut
Div
Whenever you
hear that an
organisation is
values led or is a
meritocracy you
know that there
are a set of agreed
guiding principles
that steer actions
day by day. It is
the constitution,
rather than the
hierarchy, that
provides the rules
of engagement.
Customers / Region
Divisions
Project Matrix
Support functions
THE CONSTITUTION
A number of organisational designs are, essentially, empowerment structures where an agreed set
of guidelines, values or meta processes become the
organising principle. This allows the work force
to crack on with tasks unimpeded by the need to
gain permission and sign off for their work. As
long as they abide by the constitution they are free
to act. A well worked through example of this
Feature
You are not finished when you have the structure design neatly laid out on a sheet of A3.
That is often just the start of a journey. The next step is to ensure the senior team understand
and abide by the inherent organising principles in the structure and 'walk the talk'.
is 'Holacracy', as described by Brian Robertson
(www.holacracy.org) but there are many others
based on the same principles. Whenever you hear
that an organisation is values led or is a meritocracy you know that there are a set of agreed guiding
principles that steer actions day by day. It is the
constitution, rather than the hierarchy, that provides the rules of engagement. What Robertson
has shown is how the system also leads to governance, which is a useful development.
At present some 'values led' organisations
also have a residual line structure, as if not able
yet to fully commit to this form of structure.
In most cases we have come across this has
only served to confuse people who, when push
comes to shove, revert to authority to satisfy
their felt need for control. If you are going for a
constitutional paradigm it needs to be the dominant and deciding force.
The Constitution
Values
Principles
Processes
CEO
THE AMOEBAE
How much do you remember from your biology
classes at school? The amoebae has the ability to
slowly change shape to suit its purposes and the
HQYLURQPHQWLWQGVLWVHOI LW$GDSWDELOLW\LI QRW
agility, is the organising principle here. There is
a nucleus, aka the senior team, that governs the
overall shift of evolution and rate of adaptation
not so fast that the inherent structure is lost
not so slow that it fails to capitalise on changes
in the environment. Because of the inherent
X[ LQ WKH VWUXFWXUH WKH DPRHEDH SULQFLSOH UHquires the organisation to have the ability to articulate its current and future structure requirements on a regular basis, usually once a quarter.
The Amoebae
www.europeanbusinessreview.com
31
Strategy
0RVWRUJDQLVDWLRQV,KDYHZRUNHGZLWKKDYHQHHGHGWRQG
a way to do both/and set clear parameters within which
people must work and free up the talent to produce excellent
results. Some structural designs emphasise control and compliance, such as the hierarchical line structures. Others emphasise independence, such as the constitution. But you are likely
to need both in your design. How will you reconcile the competing needs in your organisation, especially if you are a person
who has a felt need for control?
32
CONNECT
www.logility.com
Strategy
CHANGE AS
STRATEGY
BY WALTER MCFARLAND
The executives uniformly reported that learning how to perform organisational change efforts faster,
better, and with fewer resources than competitors would be a source of real competitive advantage.
34
www.europeanbusinessreview.com
35
Strategy
36
4 IDEAS ABOUT
BECOMING A
CHANGE-FOCUSED
ORGANISATION:
1
2
Create/Brand a
cadre of leaders
www.europeanbusinessreview.com
37
Strategy
Todays environment
affects the organisation
in a system-wide
manner calling for a
system-wide response.
This response demands
the creation of new
types of organisations
optimised for
continuous change.
38
Conclusion
For several decades, change efforts of every kind
have under-performed, failed or made things
worse. Even more disturbingly, this trend does
not seem to be improving which argues for
a fundamental shift in how organisations think
about and perform organisational change.
Although there are myriad approaches to
change, evidence suggests that one approach
the process-based approach may be negDWLYHO\ LQXHQFLQJ RXU WKLQNLQJ DQG SHUIRUmance on organisational change. This approach
views change as a linear and sequential process
best performed periodically by external change
agents. The rise of the global economy with
its unprecedented competition and ever increasing complexity has made this solution to
There is a critical
business process missing
in your organization
See the
possibility.
Coaching is a way of taking people out of their
blindnessgiving the possibility of creating
whatever they want for their lives.
(OHQD(VSLQDO&)0DVWHU&HUWLHG&RDFK0H[LFR
/HDUQKRZ&)FUHGHQWLDOHGFRDFKHVPHHWKLJKVWDQGDUGV
DQGSURYLGHVHUYLFHVWKDWKHOSWUDQVIRUPRUJDQL]DWLRQV
'RZQORDGRXUIUHHUHSRUWIXOORIFDVHVWXGLHVDQGUHVHDUFK
at icf.to/ACR
Coachfederation.org__LFIKHDGTXDUWHUV#FRDFKIHGHUDWLRQRUJ
Strategy
41
Strategy
When compared to negotiations between individuals of equal power, those that were between
high- and low-powered counterparts create
more value and it is the low-power party who is
the engine for this value creation.2
It is not always obvious how powerful you
are compared to your counterpart in a particXODU QHJRWLDWLRQ 5HFHQW UHVHDUFK LGHQWLHV D
strategy that can help you get (more of) what
we want in your negotiations when it is not clear
who is more or less powerful.3 Powerful negotiators often exhibit dominant behaviours such
as expanding their body posture and taking up
more physical space, using gestures often, reducing interpersonal distances, and speaking in a
loud voice. In contrast, negotiators who are less
powerful typically express deference by making
themselves physically more compact, limiting
their physical gestures, maintaining interpersonal distances, and speaking softly.
When you encounter a negotiator who
behaves dominantly you may be tempted to
match your counterparts bluster with your own
dominant behaviours. While sometimes quite
tempting, you would be better advised to be disciplined by complementing your counterparts
dominance with deference. Matching dominance with dominance often increases the aggressiveness of both parties and leaves little
space for value creation. Both parties are simply
focused on claiming more.
In contrast, behaving in a complementary
fashion meeting your counterparts dominance
ZLWK \RXU GHIHUHQFH FDQ EHQHW WKH GLVFLSOLQHG
negotiator in surprising ways. Even though in
most situations, the dominant negotiator will get
more than her deferent counterpart, the deferHQW FRXQWHUSDUW FODLPV VLJQLFDQWO\PRUH YDOXH
when behaving deferentially than the value that
is ultimately claimed by a counterpart matching
dominance with dominance, with the increased
value claiming coming from greater value creation. So the pool of resources that is available for division becomes larger and the split
RI WKLVODUJHUSLHEHQHWVWKHGHIHUHQWQHJRWLDtor proportionately more. But the complementarity works both ways: If you negotiate with a
counterpart who is deferential, you are better
off responding more dominantly. More value is
42
Deference is not
yielding; it is an
active state of
cooperation and
agreeableness that
involves subtle
persuasion and
influence tactics
in the pursuit of
ones interests
while avoiding
direct conflict.
created and both you and she gets more than the
value that would have been available to two deferential negotiators.
But before you rush to apply this strategy, you need to consider a couple of important caveats. Deference is not yielding; it is an
active state of cooperation and agreeableness
WKDW LQYROYHV VXEWOH SHUVXDVLRQ DQG LQXHQFH
tactics in the pursuit of ones interests while
DYRLGLQJ GLUHFW FRQLFW 7KH FRPSOHPHQWDULty between a dominant and a deferent negotiator creates opportunities for successful coordination. Dominant negotiators are more likely to
express their preferences or positions while their
deferent counterparts, by asking questions and
making proposals.
Importantly, human beings naturally respond
deferentially to a dominant player or dominantly to a deferential player in cooperative social
settings. This dance of coordination is typically associated with increased liking and positive
emotions between the parties. As such, even if
the social setting is characterised by the mixed
motives of cooperation and competition the
hallmark of negotiated interactions a skilled
counterpart will do well to frame the overall
exchange as cooperative and complement her
counterparts dominance with deference or deference with dominance.
So the next time you face a potential titan in
a negotiation, you should consider using this negotiation jujitsu of power complementarity if
you want to claim more.
2. Sometimes Your Foes May Help You Get (More
of) What You Want.
A negotiators reservation price the bottom
line or the worst possible deal that the negotiator will accept is an incredibly strategic piece
of information. It is the least a seller is willing
to accept or the most a buyer is willing to pay.
However, while in a purchase the reservation
price is often indeed a price, that term is used
more widely, frequently referring to a basket (or
baskets) of characteristics that comprise the
worst deal one is willing to accept, the tipping
point between an agreement and an impasse.
Negotiators often query their counterparts,
asking for their bottom lines. Not surprising,
www.europeanbusinessreview.com
43
Strategy
44
Thanks to Atradius,
non-payment by debtors
is not an issue for me.
Risk
Humanity has followed a strategy of Discover, Infiltrate, Exploit (DIE) for much
of our history, and this is the basis of much of our success as a species.
46
with the ugly side of risk, rather than the beautiful side that we universally celebrate. For most
people such failures strengthen their avoidance
of risk; eminently rational and Pavlovian. When
an action is met with a negative response the
brains in most of us are hardwired to tell us,
Dont do that again.
Fortunately there is a small portion of our
population whose brains are wired differently. These people are willing to accept risk and
loss again and again, without surrendering
their vision and without taking an easier path.
Something in them makes them continue to
strive for the rewards they see beyond all of
WKHQHJDWLYHVWLPXOLDQGWKH\FRQWLQXHWRJKW
through the urge to just give in.
If all of us were wired like this wed soon
EHQLVKHGDVDVSHFLHV$IWHUDOODYRLGDQFHRI
risk is a survival instinct. But, when a small proportion of a population is willing to take larger
risks, absorb the costs associated with occasional loss, LEARN from these experiences and persevere in taking wise risks, the population as a
ZKROHEHQHWVJUHDWO\
Some people are successful without going
through this sort of Darwinian selection process,
but Id argue that such people are lucky, rather
than good. This leads to the old saying, Id
rather be lucky than good. I beg to differ. The
SUREOHPZLWKOXFNLVWKDWLWLVDFNOHEHGIHOORZ
one that may leave you at any time. Statisticallyspeaking, it is certain to do so. Luck is for the
young and the foolish.
Taking risks, accepting loss, and rising again
to the challenge is the stuff of legends. As a
species we celebrate those who survive this
process, because we know that most of us cant
and wont. From Odysseus to King Arthur, from
Rostam to Beowulf, we idolise those who take
the heros journey and win in the end; if only
because were not sure we could do so ourselves.
Fortunately there
is a small portion
of our population
whose brains are
wired differently.
These people
are willing to
accept risk and
loss again and
again, without
surrendering
their vision and
without taking
an easier path.
www.europeanbusinessreview.com
47
Risk
IF YOU WANT TO BE A WISE RISK-TAKER AND MAKE GAMECHANGING BREAKTHROUGHS, A SURE SIGN OF SUCCESS IS
THAT MANY AROUND YOU DONT LIKE WHAT YOURE DOING
BECAUSE YOURE MAKING THEM UNCOMFORTABLE.
The list goes on and on. Naturally, for
each person who succeeds there are hundreds
or thousands who did not, which is why they
remain unknown to us. But, when someone
risks mightily, faces great loss, perseveres and
eventually wins, thats the stuff that moves us all.
It is these innovators, these risk takers, who
QGQHZZRUOGVIRUXVWRFRQTXHUWKURXJK',(
These people are the discoverers of new frontiers. They lead us into undiscovered countries
VR WKDW ZH PD\ LQOWUDWH WKHP DQG WKH\ VKRZ
XVKRZWRH[SORLWWKHPWRWKHEHQHWRI XVDOO
Somehow they are able to see through shortWHUPQHDUHOGULVNVHHWKHZRUOGKRZLWFRXOG
be, rather than how it is, and boldly lead us there.
They survive the losses that are necessarily part
of any meaningful risk, they learn from them,
and they push on through in order to eventually
receive their just rewards.
We idolise these people, and rightfully so. They
are a small minority of the human population
that creates vastly disproportionate value for the
rest of us. There is perhaps only one in tens of
thousands of us who willingly accepts such risks,
and only one in tens of thousands of those few
who actually succeed in the end. But thankfully,
this tiny fraction of our population keeps our civilisation growing, our lives more safe and secure,
and our world less risky for the rest of us.
A RECIPE FOR LEVERAGING RISK
If you have bought into the notion that nothing
great comes without accepting great risk, you
may then be compelled to ask, How do I do
this myself ? Im no scholar on the topic, although I too have had my share of epic failures in my career (two failed startups in my past,
along with a prior failed attempt at publishing
a book). But, if you analyse these people and
look at their life stories several common themes
48
www.europeanbusinessreview.com
49
Risk
JXULQJ RXW KRZ WR LQOWUDWH WKH XVH RI VRPHthing like the Internet into the marketplace (think
Cisco, Google, IBM, etc.) or how to exploit a resource like the Internet to create entirely new
value (Facebook, Twitter, Alibaba, etc.)
discover new lands, new ideas or new technolRJLHVQRWWREHQHWWKHPVHOYHVIURPWKHLUGLVcoveries. At the other end are those who try to
further the Exploit phase, but they do so against
diminishing returns and falling margins.
The real opportunity for making huge returns
on risk comes from moving from Discover
WR ,QOWUDWH RU IURP ,QOWUDWH WR ([SORLW
Christopher Columbus didnt discover the New
:RUOGKHVWDUWHGLWVLQOWUDWLRQE\(XURSH7KHUH
is still controversy over whether Edison was the
UVWWRLQYHQWWKHOLJKWEXOEEXWKHZDVFHUWDLQO\
WKHUVWWRLQOWUDWHWKHPDUNHWDQGPDNHPRQH\
RQLW$QGFDSWDLQVRI LQGXVWU\IURPWKHV
didnt discover the processes for mass production
of steel, they didnt discover petroleum, and they
didnt invent the railroad or steam power. But,
ZKDWWKH\GLGZDVLQOWUDWHWKHJOREDOPDUNHWIRU
these technologies, and then exploited their use in
order to make themselves wealthy.
So, the message here is not to go and re-inRisk Big With Conviction
vent the Internet; we still dont know who did so,
By the same token, sometimes we cant
although were fairly certain it wasnt American
break down a big risk into a series of smaller
politician, Al Gore. Rather, the goal should be ones. Sometimes, the world that visionaries
When trying something risky, it is best to take the risk and its
attending losses in small amounts, so that each loss is not fatal.
50
www.europeanbusinessreview.com
51
Marketing
52
www.europeanbusinessreview.com
53
Marketing
54
still predominantly focus on conveying advertising messages merely through the visual channel
and, if any, the acoustic channel. However, consumer perception evolves from the composition
RI DOOYHVHQVHVVLJKWKHDULQJWRXFKVPHOODQG
taste). Therefore, a holistic multisensory communication concept is needed. This enables not only
to exploit the potential of all senses separately
EXW DOVR WR EHQHW IURP PXOWLVHQVRU\ HQKDQFHment, i.e., the positive interaction effects between
the senses. So, communicating an advertising
message congruently through multiple senses will
strengthen consumers perception. Hence, using
DOO YH VHQVHV PD\ \LHOG WKH PD[LPXP LPSDFW
of communication. Especially with regard to the
luxury industry, having the focus on an exceptional brand identity, it is of major importance
to create a comprehensive and unique multisensory experience. In practice, a few luxury brands
have already quite successfully adapted this apSURDFKHJ%XUEHUU\E\LPSUHVVLYHDJVKLSVWRUH
openings, Rolls-Royce by interactive exhibitions
or Singapore Airlines by an overall multisensory
communication concept compassing stimuli of
DOO YH VHQVHV IURP WKH VWHZDUGHVVHV PDNHXS
WR D EUDQGVSHFLF SHUIXPH WKDW LV H[XGHG QRW
only in the cabin but also in hot towels etc. In
particular, luxury travel companies, and above all,
luxury hotels have to carefully set various sensory
stimuli, so that an extraordinary experience adGUHVVLQJ DOO YH VHQVHV RI WKH FRQVXPHU FDQ EH
offered leading to superior customer experiences.
value aspects were hitherto neglected, businesses need a greater understanding of consumer behaviour. Consumers no longer merely buy
products and services, but rather pay for the
experience being offered. Therefore, the customer experience concept has gained increased
attention among marketing scholars and practitioners. A good experience is an excellent way
to add value to the customer and differentiate
from the competitors, as it affects, generates
and strengthens customer satisfaction, customer loyalty and contributes to repetitive purchasing.4 The entire experience a company creates
for its customers is not simply represented by
the product or service, but includes the whole
experience creation process such as pre-purchase, moment-of-truth and post-purchase.
The concept of experiential marketing has been
successfully applied to many businesses in different industries. Especially for luxury brands,
possessing the highest level of quality and symbolic value to the customer in all touch-points,
the adaption of this holistic approach is more
than suitable. As an example, luxury airlines, e.g.
Etihad Airways or Emirates, offering an excepWLRQDOSHUVRQDOWUHDWPHQWIRUUVWFODVVSDVVHQJHUVVXFKDVLQLJKWPDVVDJHVRUSHUVRQDOFKHIV
can be mentioned. In particular, experiential
luxury marketing can be found in the hospitality and tourism industry providing the highest
experiential products such as dining and staying
in a luxury hotel or visiting a hotel destination.
Luxury Value
Perception
Multisensory
Marketing
in Figure 1, consumers evaluate products, services and experiences they are getting based on a
multifaceted spectrum of values. Especially in
the luxury travel and tourism market, where traditionally the price component has always reFHLYHGVSHFLFDWWHQWLRQHJDVFXHIRUVWDWXV
prestige and value for money), it has been shown
that luxury consumers with different desires are
less driven by costs, but driven by the individual perspective on a multifaceted value composiWLRQWKDWLQFOXGHVQDQFLDOIXQFWLRQDOLQGLYLGXal and social components:5
www.europeanbusinessreview.com
55
Marketing
56
An emerging
trend in the luxury
hotel industry is
givenby signature
scents. So do
Thompson Hotels,
which spread their
custom-designed
perfume Velvet
in rooms and
open spaces.
www.europeanbusinessreview.com
57
Leadership
An Investor's Least
Favourite Statement
ffective leaders must meet challenges and resolve them productively, day after day, for many
years. They must constantly adapt
to the unforeseen and must mobilise, coordinate, and direct others. But
when hiring executives, how do you
know which candidates possess such
qualities? When they all look good
on paper, how do you make a choice?
Given the frequency of CEO turnover,
and the frequent cases of CEO failure
58
Leadership
7 TRAITS OF
ACTIVE COPERS:
1
Awareness
2
Courage
3
Resiliency, toughness,
and the ability to learn
from experience
4
Energy, fortitude, and the
willingness to persevere
5
Resourcefulness
6
Decisiveness
7
Executing a Plan
60
All that past performance shows is that the person was able to do what was demanded
in the past; it says nothing about what the person could do with new challenges.
www.europeanbusinessreview.com
61
Leadership
62
Active coping is
important not
only for leaders
and companies
evaluating people
for leadership
positions, but also
for leaders who
can benefit from
understanding
their coping style
to improve their
own performance.
Uncover what
will make a
senior executive
succeed or fail.
Past performance does not reliably predict future success.
Understand whether your key executives will successfully cope
with or fail to cope with unexpected challenges. Understand
if they will capitalize on or miss unexpected opportunities.
Understand their minds and how they work.
01:30
00:45
www.WhartonWomensLeadership.com
clarity&
confidence
TO ASCEND THE MANAGEMENT RANKS
APPLY TODAY:
www.WhartonWomensLeadership.com
Female Leaders
hile there is ample evidence that companies across industries and sectors do
better when there are women in senior
leadership positions, unfortunately in Europe,
and even in the United States, the lack of female
corporate leaders is staggering. Only 3% of the
largest publicly listed companies in the EU have a
female CEO, and only 7% have a female chairperson of the board. Across the Atlantic, in the US,
women hold less than 5% of Fortune 500 CEO
roles and comprise only 19% of board seats.
When discussing this lack of representation,
the questions that often emerge are, not very
surprisingly, :K\ DUH WKHUH QRW PRUH ZRPHQ LQ VHQLRU
leadership roles? As well as, How do we create more
corporate female leaders?
When these questions are the focal point
for inquiry, the answers that emerge are often:
create more mentorship opportunities for
mid-level women, address corporate pay inequity, or engage in more diverse corporate leadHUVKLSUHFUXLWPHQWWROORSHQVHQLRUSRVLWLRQV
Rarely does the question Im more interested in
answering come up: :K\ GR VR PDQ\ H[SHULHQFHG
KLJKO\ HGXFDWHG ZRPHQ QRW EHOLHYH WKH\ DUH UHDG\ WR OHDG"
Why Dont More Women See Themselves
as Leaders?
In one of the most frequently referenced books
on women and work, Sheryl Sandbergs Lean In,
Sandberg points to the reality that while both
men and women experience self-doubt about
their abilities, for women the fear of being seen
DVDIUDXGLVVLJQLFDQWO\PRUHSURQRXQFHG$V
she reveals, Multiple studies in multiple industries show that women often judge their own
performance as worse than it actually is, while
men judge their own performance as better than
it actually isand in situations where a man and
a women each receive negative feedback, the
ZRPDQV VHOIFRQGHQFH DQG VHOIHVWHHP GURS
to a much greater degree.1
In their book How Remarkable Women Lead,
authors Joanna Barsh and Susie Cranston attribute this fear of stepping into leadership as
the damned-if-you-do, damned-if-you-dont
problem.2 Too many women who know they
want to lead have seen others who speak up
DQG RXW JHW EUDQGHG DV DJJUHVVLYH GLIFXOW
self-promoting.
3%
Only 3% of the largest
publicly listed companies in
the EU have a female CEO
7%
and only 7% have a female
chairperson of the board.
< 5%
Across the Atlantic, in the US,
women hold less than 5% of
Fortune 500 CEO roles
19%
and comprise only
19% of board seats.
www.europeanbusinessreview.com
67
Female Leaders
Current research
into womens lack
of representation
in business and
political leadership is
increasingly pointing
to unconscious
gender bias as a key,
contributing factor.
68
Current research into womens lack of representation in business and political leadership is increasingly pointing to unconscious
gender bias as a key, contributing factor. From
traditional male traits that are privileged over
female ones to male names, pronouns and interests used in conversation and company culture,
men and women are failing to see the presence
not only of women but also of the feminine.
And as a result, women are failing to see themselves in spaces that are marked male and masculine. Sadly, this bias starts early. In Harvard
Graduate School of Educations Making Caring
Common report, Leaning Out: Teen Girls and
Leadership Biases, Harvards research of approximately 20,000 students revealed that 59 percent
of young people surveyed preferred the idea of
a male student council leader to a female one.3
How Do We Give High Potential Women
What They Need to Succeed?
We can, and must, bring male and female leaders
together to call out and address gender bias,
overt or unconscious, wherever it exists. Even
more importantly, if we are truly serious about
PRVWQRWHZRUWK\LVWKHGLIIHUHQFHLQFRQGHQFH
SHUFHQWRI IHPDOHJUDGXDWHVRI LQGHSHQdent single-sex schools rate themselves above
average or in the highest 10 percent for academic ability, compared to 75 percent of
women graduates of independent coeducational schools. And nearly 60 percent of women
graduates of independent single-sex schools rate
themselves above average or in the highest
SHUFHQWZLWKUHJDUGWRLQWHOOHFWXDOVHOIFRQdence, compared to 54 percent of their independent coeducational school counterparts.4
$QGWKLVFRQGHQFHVWD\VZLWK\RXQJZRPHQ
beyond their college years. In the US, graduates of
womens colleges and universities make-up more
than 20% of women in Congress, and they represent approximately 30% of Businessweeks list of
rising women in corporate America. Yet despite
the growing recognition that young women both
IHHOPRUHFRQGHQWDQGKDYHKLJKHUUDWHVRI DVpiration and achievement when they attend girls
schools, there hasnt been tremendous movement
to take these principles and apply them to developing professional womens leadership skills.
Womens Leadership Development
From Theory to Practice
To develop strong female leaders, participants
must be able to get up on their feet, put into practice what they are learning about themselves and
how to lead others, and receive real-time feedback
WRVROLGLI\DQGZKHQQHFHVVDU\UHQHWKHLUOHDGership skills. This is where most well intentioned
womens leadership development programs
fall short. Too many are built from conferences or mentorship programs where participating women are passive recipients of advice given
by others. Unfortunately, as we know from the
HOGRI OHDUQLQJDQGGHYHORSPHQWOHDUQLQJWUDQVfer does not happen effectively this way. While
expert leadership advice has a place, if high potential women are to believe they are capable of
leading, they need the rehearsal space to see their
leadership in action.
In McKinsey & Companys Remarkable
Women Program, participants have the opportunity to engage in experiential learning opportunities. Participating women are able to try out the
behaviors and skills they are learning in real-time
www.europeanbusinessreview.com
69
Female Leaders
Every single one of the executive women who I have spoken with sees herself
as the protagonist in the story of her life. These women believe that success is
the inevitable product of hard work and consistently tell stories and engage in
self-talk that sets them up to shift setbacks into catalysts for future success.
P\ GR]HQV RI UVWKDQG LQWHUYLHZV ZLWK ZRPHQ
in industries ranging from hospitality and technology to public relations and social enterprise,
four key themes have emerged.
First, every single one of the executive women
who I have spoken with sees herself as the protagonist in the story of her life. While some of
these executive women have impressive pedigrees, a few did not complete college. Others encountered teen pregnancy and in some cases grew
up economically disadvantaged. Nonetheless,
these women believe that success is the inevitable
product of hard work and consistently tell stories
and engage in self-talk that sets them up to shift
setbacks into catalysts for future success.
Second, each woman spoke of her success as
the byproduct of the people in her work life
people senior, lateral and junior. All report benHWWLQJ IURP UHODWLRQVKLSV ZLWK PHQ ZKR KDYH
championed them in their careers, and all spoke
about developing teams whose collective success
enabled their individual success.
Third, each woman believed a primary contributing factor to her success was her ability to
respond effectively to feedback. Whether feedback was solicited or thrust upon them, whether
it was in praise of their work or critical of it, each
interviewed woman spoke about her ability to
receive the feedback with little to no emotion and,
DIWHU UHHFWLRQ DSSO\ LW ZLWKRXW SHUVRQDOLVLQJ LW
Fourth, each woman spoke about times in
her career where she was uncomfortable. From
salary negotiations to project pitches to addressing boards to being the dissenting opinion on
a big decision, each spoke about her ability to
accept that discomfort is part of leadership and
had cultivated the ability to be comfortable with
being uncomfortable.
Where Do We Go From Here?
While more and more organisations are recognising that their senior leadership is
70
disproportionately male, whether organisations will make the right investments to create
a pipeline that empowers women to lead is less
clear. For companies who want to set their high
potential women up for success, its important
to prioritise three key things. Womens leadership development should happen in single sex
environments. It should incorporate opportunities to develop real-world leadership skills
WKURXJK FDVH VWXGLHV DQG UROH SOD\LQJ GLIFXOW
situations. And, just as importantly, it needs to
address inner work as much as outward leadership. From arguing on behalf of an idea to
GHYHORSLQJ PXWXDOO\ EHQHFLDO UHODWLRQVKLSV
from being comfortable being uncomfortable
to seeing ones self as the protagonist in her
career and in the story of her life, women are
hungry for leadership development opportunities that are as holistic as they are practical.
About the Author
Alexia Vernon is the Founder and
'LUHFWRURI ,QXHQFHU$FDGHP\D
womens leadership development
program based in Las Vegas,
Nevada, USA. Branded a Moxie
0DYHQE\WKH:KLWH+RXVH2IFHRI 3XEOLF
Engagement, Alexia is an in-demand keynote
speaker, trainer and consultant on developing
next generation female leaders. Alexia has been
featured by media such as CNN, NBC, the Wall
Street Journal, Inc., and Forbes.
References
1. Sandberg, S. (2013). Lean In: Women, Work, and the Will to Lead (New
York, NY: Random House) p. 29.
2. Barsh, J & Cranston, S. (2009). How Remarkable Women Lead: The
Breakthrough Model for Work and Life (New York, NY: Crown) p. 197.
3. Harvard Graduate School of Educations Making Caring Common
Project (2015) Leaning Out: Teen Girls and Leadership Biases. http://
VLWHVJVHKDUYDUGHGXVLWHVGHIDXOWOHVPDNLQJFDULQJFRPPRQOHV
mcc_leanout_report.pdf.
4. UCLAs Sudikoff Family Institute for Education and New Media
(2009) Women Graduates of Single-Sex and Coeducational High
Schools. https://sudikoff.gseis.ucla.edu/archive/pdfs/genderstudies/
Summary_SingleSexEd_Sax.pdf.
GLOBAL
FEMALE LEADERS
THE ECONOMIC FORUM FOR FEMALE EXECUTIVES
17th 19th APRIL, 2016 | THE RITZ CARLTON BERLIN | GERMANY
Kristalina Georgieva
Vice President Budget
& Human Resources,
EU Commission,
Belgium/Bulgaria
Simone Menne
CFO and member of
the Executive Board,
Deutsche Lufthansa
AG, Germany
Premium Partners
Jurate Keblyte
Group CFO,
KUKA Robotics,
Germany
Stryker, USA
Official Carrier
Ursula Soritsch-Renie
CIO,
Sulzer Management AG,
Switzerland
Promoter
Juliana Rotich
Tech Entrepreneur,
Executive Director,
Ushahidi Inc.,
Kenya
Supporters
Hosted by
Media Partners
Official Part of
Stay connected
www.globalfemaleleaders.com
Management
REMOTE TEAMS:
Managing Attitudes, Not Activity
BY DREW GURLEY
Managing remote teams is tricky. If attitude is the icing, function is the cake. In
this article, Drew Gurley discusses why
we should manage attitudes within remote
teams and not their activities.
Managing the
attitudes of
team members
is an entirely
different
challenge. Its
the difference
between share
of mind and
share of heart.
www.europeanbusinessreview.com
73
Management
74
www.europeanbusinessreview.com
75
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Technology
he Internet-of-Things (IoT) revolves around interconnected devices, systems and services within the existing Internet infrastructure. The IoTs value lies in it
being able to capture and analyse the data obtained from the
sensors at the endpoints of the
connected devices. The ability to
put all of this data together means
that IoT can bring considerable
EHQHWV WR LQGLYLGXDOV EXVLQHVVHV
and society. Take a look at the following examples:
Acts of integrating IoT into
the health care system can
be the implementation of a
chip into individuals, for instance with wearable technology, allowing for hospitals to
monitor the vital signs of the
patient, which could help indicate whether or not serious assessment is necessary.
For businesses, the IoT can be useful in many different
categories including asset tracking and inventory control,
security, individual tracking, shipping and location, and
energy conservation.
The crux of the IoT is that it allows for communication between devices, allowing extensive data tracking and
measurement that makes it possible to predict and subsequently automate logistical processes. Because IoT relies extensively on delivering information to a business to capitalise on the data supplied, a problem of integrity, however,
may be around the corner. As Michael Snyder noted, The
Internet allows us to reach into the outside world from
inside our homes, but it also allows the reverse to take place
as well. The IoT industry is slowly starting to recognise
WKDWWKHLUVHFXULW\WUDFNUHFRUGKDVEHHQSRRU+LJKSUROH
cases such as the US Federal Trade Commission (FTC) settlement with TRENDnet revealing that because of poor security
practices their Home CCTV system
allowed strangers to see, and sometimes listen into, over 700 home security camera feeds, have contributed to this sense of awareness. As a
matter of fact, from cameras to industrial controls to GPS systems, the
increased connectivity of devices
leads to increased security threats
and should thus be managed properly by the IoT industry. But, is it?
We fear it is not. In fact, realising
that it is increasingly becoming the
norm among knowledge driven companies to collect enormous amounts
of data to predict the behaviour of their customers, the risk
of integrity breaches is only likely to go up. This unfortunate lack of attention to the integrity aspect of the business
is further enhanced by the belief that IoT will enhance the
UPVFRPSHWLWLYHEHKDYLRU7KLVPHDQVWKDWFRPSDQLHVGR
not shy away from, for example, monitoring and targeting
www.europeanbusinessreview.com
77
Technology
It is not surprising to
see that trust in the
data collection process
is diminishing and
malicious intentions
and practices are
widespread and
appear to be growing.
communication and behavioural marketing data from the competition may also
provide information about the direction they
are headed. Monitoring blog posts can alert
FKDQJHVLQPDUNHWG\QDPLFVDQGJLYHWKHUP
a head start in their preparation for a counter
competitive strategy.
Given the prevalence of these practices,
which are considered legal and therefore raise
no questions anymore about integrity in the
minds of those using this technology, it is not
surprising to see that trust in the data collection
process is diminishing and malicious intentions
and practices are widespread and appear to be
growing. For example:
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contracts to their unique IoT ecosystem,
bleeding them with fees and confounding
WKHPZLWKQHSULQW7KLVLVDFRPPRQSUDFtice among insurance providers, health clubs,
and banks.
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into making poor purchase decisions through
the use of complicated and detailed rules and
conditions of use/sale. Some of those practices include confusing usage rates, high penalties when customers exceed credit limits,
overdrafts and payment deadlines, or fall
short of minimum balances in bank accounts.
Overcoming Distrust in the Data
Collection Process
Although these practices can be considered
borderline exploitation (some are simply poor
service practices) they do destroy the trust of
the end-users (i.e. customers). We argue that one
of the main reasons leading to this violation of
trust is that the fairness of both the data collection process and the monitoring technology that
is used is poorly managed.
Customers may experience that they are
treated differently and even deprived from
FHUWDLQVHUYLFHVDQGEHQHWV)RUH[DPSOHYXOnerable groups such as the young, elderly or
SRRUPD\EHWDNHQDGYDQWDJHRI E\UPVZLWK
malicious intent, in that they can make the IoT
system overly complicated and a pricing system
VRFRPSOH[WKDWWKHVHJURXSVZLOOQGLWGLIFXOW
to make an informed decision. It also happens
78
Fairness must be
a commitment at
the strategic level,
from the senior
managements
influence in the
firms philosophy
and values
statement to the
front office of
customer services.
www.europeanbusinessreview.com
79
Technology
80
It is those companies
that best understand
and make use of
all this consumer
data who may be
best positioned to
provide appropriate
standards for its use.
www.europeanbusinessreview.com
81
Technology
Disclosure
Companies must
temper their
enthusiasm for Big
Data analytics with
a strong sense of
responsibility, even
humility, over the
power that they
now wield with
regard to customers.
82
Transparency
Recourse
Monitoring
predictive analytics.
To some this may sound like a valuable innovation, like receiving a surprise birthday present
every day of the year, while to others it may represent a new plateau of customer manipulation
and intrusion. If this is the case for the majority,
the backlash against such aggressive use of our
personal data may be substantial.
Technology has no morality, it just is. The
manner in which we utilise a given technology
is what determines its morality, or lack thereof.
Companies must temper their enthusiasm for
Big Data analytics with a strong sense of responsibility, even humility, over the power that
they now wield with regard to customers.
If they do not, they risk offending them and
awakening the sleeping giant of government
over-regulation and eventual destruction of the
business model on which their entire business
ultimately rests.
About the Authors
Robert Owen is Partner in Charge
RI WKH 1HZ <RUN 2IFH RI
Sutherland, Asbill & Brennan LLP.
He has decades of commercial litigation experience and is an experienced teacher of trial skills. Chambers &
Partners consistently ranks him as RQH RI YH UVW
UDQN OHDGLQJ LQGLYLGXDOV LQ H'LVFRYHU\ LQ $PHULFD
Christopher Surdak, JD, is the
author of the book Data Crush,
getAbstracts International Book of
the Year 2014. He is a technology
evangelist specialising in the organisational and legal impact of new technologies.
Empowering your
communication globally,
anywhere, anytime.
Thanks to Atradius,
non-payment by debtors
is not an issue for me.