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NEW TRENDS IN MANAGEMENT EDUCATION IN EASTERN EUROPE. Marc LUYCKX GHISI Dean Cotrugli Business Academy Zagreb, Croatia. NEW TRENDS ?. Eastern Europe and the Balkans have a hidden competitive advantage. They are more open to the future than Western Europeans

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New trends in management education in eastern europe l.jpg

NEW TRENDS IN MANAGEMENT EDUCATION IN EASTERN EUROPE

Marc LUYCKX GHISI

Dean Cotrugli Business Academy

Zagreb, Croatia.


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NEW TRENDS ?

  • Eastern Europe and the Balkans have a hidden competitive advantage. They are more open to the future than Western Europeans

  • Probably because of their recent and older story.

  • They have been obliged in 50 years to adopt communism and abandon it.

January 24-25, Bangalore


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NEW TRENDS ? II

  • They are now eager to find a place in the new capitalist industrial world.

  • And to join the European Union if it is possible…

  • But it seems that they also have less objections to shift further to the post industrial, post capitalist knowledge economy.

January 24-25, Bangalore


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NEW TRENDS ? III

  • Comparing my students in Rouen (France) and in Zagreb, I find a difference of creativity and motivations.

  • East europeans are smart and more open to the change.

  • They are more ready to innovate and to take risks.

January 24-25, Bangalore


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NEW TRENDS ?

  • But they have also much less security of employment and carreers.

  • They are more obliged than others to be proactive and creative.

  • Their actual insititutions are not always transparent. OK. But everyone knows that they will change and possibly improve, if they enter the EU…

January 24-25, Bangalore


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EXAMPLES

  • COTRUGLI BUSINESS ACADEMY, in ZAGREB, Croatia, is one example of innovation in management education. (Drazen KAPUSTA)

  • « SEAVUS » is a very innovative company in Macedonia.(Igor LESTAR)

  • Both will be presented here in this congress.

January 24-25, Bangalore


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CBA’s HYPOTHESIS (I)

  • Our hypothesis is that we are worldwide going full speed towards the knowledge economy.

  • EU Lisbon Strategy (2000-2010)

  • EU economy is already 45% in this knowledge economy, which according to Peter DRUCKER is post capitalist.

  • The «classical» Management education prepares only for today’s industrial, capitalist non sustainable, society

January 24-25, Bangalore


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CBA’s HYPOTHESIS (II)

  • CBA has has decided to have a « two legs approach » to management education.

  • One leg is education for the industrial capitalist economy

  • The second leg is education for the post-industrial, and post capitalist, knowledge economy.

January 24-25, Bangalore


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CBA’s HYPOTHESIS (III)

  • Now students discover that this second leg approach asks from them new skills, and a new vision of the market, of concurrentce, competition,…

  • They must understand « intangible assets » which are forcing them to take into account new factors like the environment and social inclusion.

January 24-25, Bangalore


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CBA’s HYPOTHESIS (IV)

  • This changes the CEO’s image and the company’s image.

  • We must prepare our students for this new world, with a new Management education strategy.

  • Thus our Management education is really twofold.

  • We are preparing our students for 2 societies and 2 economies.

January 24-25, Bangalore


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CBA’s HYPOTHESIS (V)

  • Most of our students understand and approve our vision and our education proposal. Not all.

  • Some are really enthusastic and understand fully.

  • We consider our duty to help Croatia to « leapfrog» to the post-industrial society, and be excellent in the 21 st century.

January 24-25, Bangalore


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CBA’s FUTURE

  • Drazen KAPUSTA, CEO of CBA will explain how CBA is planning the future…

January 24-25, Bangalore


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SEAVUS

  • I have recommended SEAVUS, because it appears to be one of the most innovative company in the region.

  • Igor LESTAR CEO of SEAVUS will explain

    • How the company works

    • What his company expects from Management education in the XXIst century…

January 24-25, Bangalore


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EASTERN EUROPE

  • I believe in the potential of Eastern Europe, and specially the Balkans.

  • Because they have had hard times and are most of the time open to the future, at least among our business students.

  • They have a potential to be able to leapfrog to the next post industrial society, and pull the rest of Europe…

January 24-25, Bangalore


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THE NEW DEBATE ON MANAGEMENT EDUCATION

January 24-25, Bangalore


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DRUCKER ON POST CAPITALISM

  • We are far enough advanced into the new post-capitalist society to review and revise the social, economic, and political history of the Age of Capitalism and of the nation-state. …That the new society will be both a non-socialist and a post-capitalist society is practically certain. And it is certain also that its primary resource will be knowledge. (page 4).”

January 24-25, Bangalore


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DRUCKER: OLD MANAGEMENT

  • “When I first began to study management, during and immediately after World War II, a manager was defined as “someone who is responsible for the work of subordinates.” A manager in other words was a “boss”, and management was a rank of power. This is probably still the definition good many people have in mind when they speak of “managers” and “management”.

January 24-25, Bangalore


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DRUCKER: NEW MANAGEMENT

  • “The right definition of a manager is one who is “responsible for the application and performance of knowledge”. This change means that we now see knowledge as the essential resource. Land, labour, and capital are important chiefly as restraints. Without them, even knowledge cannot produce. Without them even management cannot perform. But where there is effective management, that is application of knowledge to knowledge, one can always obtain the other resources.”

January 24-25, Bangalore


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QUESTION ON EDUCATION

  • Are our management education schools able to prepare managers to be responsible for the application and performance of knowledge ?

  • Naturally we have to prepare them also for the industrial society

  • But are we sufficiently aware that we have to really prepare our students for a different future?

January 24-25, Bangalore


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Transition to Transmodern

Death ?

January 24-25, Bangalore


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WHY KNOWLEDGE SOCIETY?

  • UNESCO (2005) has also made an important declaration on the « Knowledge society ».

  • Distinguishing « information society » as still industrial with more ICT, and « knowledge society » as a new post industrial and sustainable/inclusive society.

January 24-25, Bangalore


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WHY KNOWLEDGE SOCIETY ?

  • The EU Head of State have decided in March 2000 that the EU has to be the most competitive economy in the knowledge society before 2010.

  • And this must happen in a completely sustainable and socially inclusive way.

  • This is what is called « The Lisbon Strategy 2000-2010).

January 24-25, Bangalore


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DEFINITIONS

  • Data: what is on the web, non-organised

  • Information: is already sorted by « google ». Overabundance.

  • Knowledge: is created by human brains interacting in networks

  • Wisdom: takes future into account!

  • Knowledge, Wisdom are rare. Not enough.

January 24-25, Bangalore


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EXAMPLE: ASCO

  • ASCO won the bid of the EU Commission for running its site. Huge contract.

  • ASCO has 48 hours to translate into 15 languages all productions of the EU Commission.

  • Computers and capital are 20%

  • 80% of the company’s value are its people

January 24-25, Bangalore


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A NEW WORLD...

  • New tool of production : human brain

  • New CEO: Enabling creativity and sharing,

  • New human-centered management

  • New value creation process : adding K to K.

  • New Trade: from Free Trade to Free Sharing

  • New measurements = qualitative “intangibles”

  • New strategy: beyond war: win-win not win-loose

  • New definition of Progress = qualitative

  • Beyond patenting towards “Open Source”

  • Beyond pyramids towards networks

  • Capitalizing on cultural capital + gender capital

January 24-25, Bangalore


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1. NEW TOOL OF PRODUCTION

  • The tool of production is not anymore machine + technol.+ €

  • It is human brain + networks for sharing knowledge in order to create new Knowledge.

  • This new tool of productionis more important than capital and technol.

  • Hence Post capitalist society (Peter Drucker).

January 24-25, Bangalore


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ASCO

  • The new tool of production are the translators…

  • Better treat them well…

January 24-25, Bangalore


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2. NEW VALUE CREATION PROCES

INDUSTRIAL SOC.

Add value to object

From steel to car !

Tool is Machine

Humans are cost

Management is machine-centered

Machine is central

KNOWLEDGE SOC.

Create new Knowl.

From data info to K

Tool is Human

Humans are capital

Management is Human-centered

Machine is second

January 24-25, Bangalore


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ASCO

  • The value creation process here is to apply the translators’ knowledge on knowledge : Commission’ texts.

  • Translators are the main tool of production.

  • Computers are necessary but not first.

January 24-25, Bangalore


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ASCO

  • How to control the quality of translations ?

  • Through « command and control »? This is impossible. What to do?

  • Networking Cocktails with all the « Slovenians » of Brussels. They all want a good text and accept to collaborate in improving the text.

  • This full WIN-WIN strategy…

  • And it worked perfectly….

January 24-25, Bangalore


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3. NEW MANAGEMENT

Human capital is central because it is caring for the tool of production: Please come back!

Thus Management : shifts 180° towards human centeredness = more creativity-centred, gender & culture – centred.

January 24-25, Bangalore


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4 NEW CEO FUNCTION

  • Old CEO: command, control, capture

  • New CEO:

    • enable the creativity of his “human capital”= tool of Production

    • Enable and creator of networks around his team. Cannot control networks!

    • Care for the intangible assets= brand

January 24-25, Bangalore


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ASCO

  • A new CEO came in. He had bought the prosperous company.

  • And he imposed the old industrial style of management.

  • In 48 hours, half of the personnel was gone…

  • …And the Commission suspended the contract.

January 24-25, Bangalore


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ASCO

  • In a few days ASCO’s Share hd lost 50% of its value.

  • An error of management can be terrible and fatal…

January 24-25, Bangalore


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5. BEYOND TRADE (I)

If I exchange an object against money, I loose the object. This is “trade”: I win and I loose. “Win-Loose” logic

If I exchange knowledge, I do not loose my knowledge. I win and you win. I am not trading anymore. I share. This is a “win-win logic” of sharing.

January 24-25, Bangalore


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5. BEYOND TRADE (II)

INDUSTRIAL SOC.

Free trade of objects

Industrial structure

Pyramids

Unemployment

Pollution

Quantitative growth

KNOWLEDGE SOC.

Free sharing of knowl.

Post-industrial

Network =value creation

Self-creation of my job

Dematerialization of production.

Qualitaitve growth

January 24-25, Bangalore


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6. 1. A NEW SYSTEM OF MEASUREMENTS

« Intangible assets » is a new concept invented by Karl Erik SVEIBY (Sweden).

They are becoming more and more important in the knowledge society

Because the knowledge society is about knowledge which is immaterial, intangible and qualitative.

January 24-25, Bangalore


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6. 2. INTANGIBLE ASSETS

  • Intangibles assets =

    • Know how,

    • Reputation,

    • Trust in the company,

    • Structure of the company,

    • Strategy (balanced scorecards)

    • Relations with personnel,

    • Relations with clients,

January 24-25, Bangalore


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6.3. INTANGIBLE ASSETS (II)

Relation with civil society

Relation to environment

Relation to our collective Future and sustainability

But also quality of the Networks

January 24-25, Bangalore


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6.4.MEASURING INTANGIBLE ASSETS ?

Stock exchange measurements are still looking at financial “tangible” assets (quantitative) but they increasingly look at “intangible” assets (qualitative).

Today a company is measured more and more by its intangible assets.

Example: “Men’s Wear” USA. & “World Business Academy”, “Spirit in Business”.

See also Neskey: www.neskey.com

January 24-25, Bangalore


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6. 5. Intangible indicators grow

Potential for greaterparticipation andwider accountability

Non-financial indicators grow in importance

Transparency

Financial indicators remain important

1990

2008

2020

ICT Proliferation

January 24-25, Bangalore


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6.6. GROWING IMPORTANCE OF INTANGIBLE ASSETS (II)

January 24-25, Bangalore


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ASCO: INTANGIBLE ASSETS

  • In two days ASCO shares lost 50%, because their reputation was down…

    • In the Commission: contractor

    • Among the workers: producers

    • In the consumers community: readers

  • Intangible assets here are 90% !

January 24-25, Bangalore


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7. NEW BUSINESS STRATEGY/ WIN-WIN

Old business strategy is warlike. Battlefield images are frequent. Patriarchal values dominate: “win-loose”

New business strategy: much less violent, “competition through collaboration” is the new motto.

Knowledge behaves like love!

January 24-25, Bangalore


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ASCO & WIN-WIN

  • Impossible for ASCO to have a command and control strategy…

  • It is obliged to have a win-win approach.

January 24-25, Bangalore


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8. NEW DEFINTION OF PROGRESS

The industrial & modern definition of progress is quantitative. More is better.

This definition is UNSUSTAINABLE

The knowledge society implies a qualitative definition of progress.

Good new! this allows a reorientation of our societies towards sustainability

January 24-25, Bangalore


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9. BEYOND PATENTING

The whole of the industrial production system is based on secrecy and patenting. I have this technology and you have not. So I win!

“Information and knowledge always leak”

In the knowledge economy we will NOT be able to maintain secrecy & patenting.

See generic medecines, I-Pod music, etc,.

January 24-25, Bangalore


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10. BEYOND PYRAMIDS TOWARDS NETWORKS

  • Pyramids are the « normal » structure of industrial organizations

  • But knowledge is created only in networks. This is the shape that could prevail in the XXIst century.

  • Pyramids are all in crisis everywhere. In Busienss, Governments, Military, Churches, NGO’s, etc.

January 24-25, Bangalore


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ASCO = NETWORK !

  • Impossible to survive as pyramid!

  • The new CEO tried ad killed the company in a few days !

January 24-25, Bangalore


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11. CAPITALIZING ON CULTURAL AND GENDER CAPITAL

Unexpectedly, culture and gender diversity becomes important as they feed creativity

The knowledge management is thus potentially socially inclusive and sustainable

The “Lisbon strategy” was thus excellent and forward looking.

January 24-25, Bangalore


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CONCLUSION : NEW VALUES…

  • Underlying values needed in the industrial capitalist society are freedom, initiative, ceativity…

  • NEW Values are needed:

    • Freedom (of sharing)

    • Solidarity, Caring, Respect

    • Transparency

    • Concern for the Common Good

January 24-25, Bangalore


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Consequences for the Business (II)

  • IN US, only 10% of the «Knowledge society» business has survived the dot.com crash. Example: CISCO

  • Because they have changed :

    • The tools (ICT)

    • The structure of their enterprise

    • The underlying vision of their scope and values (Verna ALLEE)

January 24-25, Bangalore


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Consequences for the business

  • 90 % of the EU Business leaders stick to the old industrial strategies:

    • More capital + advanced technology

  • 10% of the EU Business leaders change their strategy:

    • Capital+ Technology.+human creativ

    • Entreprise in Network :win-win strat.

    • Personnel is not a cost but key asset

January 24-25, Bangalore


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Business & society :A new relation

Industrial objects are “tangibles” & ethically neutral.

Knowledge is “intangible” & always linked to a meaning and thus to ethics.

Producing knowledge thus involves a meaning and a business reputation = an “intangible” asset.

January 24-25, Bangalore


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Four definitions of entrepreneurship

Agrarian : Conquer More land

Industrial : Conquer Markets. CEO controls and knows.

Knowledge entrepreneur : cares for human capital, fosters creativity, Sustainable. Facilitator.

“Spiritual” entrepreneur: conscious of his mission towards the Common Good of Humanity.

January 24-25, Bangalore



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CHALLENGES FOR MANAGEMENT EDUCATION

Most Business schools seem slow to adapt, but Business is quick !

It seems easier to innovate far from the power centers: Croatia, Macedonia, Bulgaria, Serbia.

Croatian students response is 60% positive. They are the voice of CBA outside.

January 24-25, Bangalore


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A NEW CONVERSATION?

India is a leader in Knowledge economy.

But is India enough aware of the post industrial dimension?

India has also been the creator of the greatest religions in the world

January 24-25, Bangalore


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A NEW CONVERSATION ?

  • Could we not initiate with India, a new conversation

    • on Management education in the knowledge society?

    • on spirituality and responsibility in this new knowledge business

    • On wisdom in Business preparing for a really sustainable society?

January 24-25, Bangalore


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Some good Books…

Peter DRUCKER: “Post capitalist society”, Harper Business, New York, 1993.

Verna ALLEE: “The future of knowledge” Elsevier Science, 2003, USA.

Jeremy RIFKIN: “The European Dream: when Europe’s vision of the future is silently eclipsing the American dream” Penguin 2004.

Ray ANDERSON: “Mid Course correction” 1998. www.chelseagreen.com (Interface)

World Business Academy: www.worldbusiness.org

January 24-25, Bangalore


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SOME GOOD BOOKS…

  • “Neskey” on intangible measurements : www.neskey.com

  • David ROONEY (Australia): “Handbook on the Knowledge economy” 2005.

  • Marc LUYCKX GHISI : « The Knowledge society: Building a sustainable future. » editions romaines, Luxembourg. 2008. www.leseditionsromaines.com

January 24-25, Bangalore


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SOME GOOD BOOKS III

  • Marc LUYCKX GHISI: "A win–win strategy for the European Union in the knowledge society"published in the "European Visions for the knowledge age: a quest for a New Horizon in the information society". Paul KIDD(Ed.) Cheshire Henbury, UK, 2007.

January 24-25, Bangalore


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