BEYOND EFFICIENCY: ANSWERS TO COMPLEXITY CHALLENGE

1. BEYOND EFFICIENCY: ANSWERS TO COMPLEXITY CHALLENGE New tools for new organizational challenges The Hague, June 14, 2006

2. Campus profile • Campus is a a management consulting firm that belongs to Innova Group (www.innova-eu.net), the largest European private network of innovation services • Within Innova Group, Campus is specialized in stimulating and supporting companies in order to valorize their knowledge as competitive lever • Campus has always paid great attention to advanced management theories • Campus focuses its action particularly on the study of techniques and tools for the concrete application of the theories in the business environment

3. Complexity theory: provocations from the middle age Midway upon the journey of our life I found myself within a forest dark, For the straightforward pathway had been lost. (Dante Alighieri, La Divina Commedia, Inferno, 1306) MIDWAY UPON THE JOURNEY OF OUR LIFE = STORE OF KNOWLEDGE FOREST DARK = COMPLEXITY

4. Complexity theory: which implications for our companies? • How can companies react to the increasing complexity and uncertainty of the business environment? • How can companies be spiders and not preys in the spider’s web of complexity? • Campus is able to provide to its customers an effective and exclusive support in applying the advices that derive from the advanced research on complexity in the business organizations and environment

5. Answers to complexity • The tool designed by Campus: company’s network analysis(SNA – Social Network Analysis) • First rule: opening out • The tool designed by Campus: dynamic scenario analysis (SD – System Dynamics) • Second rule: the re-orientation • The tool designed by Campus: coaching for creativity (LTC – Learning To Create) • Third rule: the equilibrium between order and disorder

6. FROM THE CASTLE…. ….TO THE NETWORK From formal coordination…. …. to informal coordination First rule: opening out • The real structure of a company is not represented by the organizational charts • How can we discover the real networks that operate under the formal organizational structure and indicate therefore ways of improvement?

7. After intervention Before intervention First answer: company’s network analysis Campus is able to map and visualize the informal process within a company • Interventions can be articulated on 3 levels: • Reorganization of the formal structure (eg. shifting of key resources, individuation of emerging leaders …) • Valorization and development of the informal relations among key actors (eg. settlement of periodic inter-functional meetings,…) • Integration of peripheral subjects to the informal network(eg. involvement of personnel and creation of heterogeneous groups,…)

8. Company’s network analysis: an example Homogenous groups (clusters) Opinion leader

9. Company’s network analysis: an example Collaboration degree among different companies of an industrial group HIGH COLLABORATION Collaboration among different companies Collaboration within the same companiy Azienda A LOW COLLABORATION Azienda B Azienda C Azienda D Azienda A Azienda B Azienda E Azienda C Azienda D Azienda F Azienda E Azienda F

10. Company’s network analysis: an example Average centrality degree: 5,769 • Too much dependency on a single person • Bottle neck Average density: - 27,77% Four isolated people Network centralization: 80,00 %

11. Second rule: the re-orientation • Predicting future is more and more difficult: it is useful to build alternative scenarios • To anticipate moves • Strategic flexibility

12. Second answer: dynamic scenario analysis • Managers must face different types of uncertainties: • Environmental (the environment is not predictable) • Organizational (the impact of the changes is difficult to understand) • Decisional (risk to mistake the forecast of the effects) Campus applies simulation models based on System Dynamics to understand the behaviors of complex organizational systems and to build alternative scenarios APPLICATION FIELDS: • Decision making process • Modeling and test of scenarios • Development and test of strategies • Business Process Reengineering • Organizational learning • Check of variable systems behavior • Making explicit tacit knowledge

13. Third rule: the equilibrium between order and disorder EDGE OF CHAOS ORDER DISORDER DEVELOPMENT AREA • It is not sufficient to increment company's efficiency • We must accept a certain “level of disorder” • Creative capacity as a lever for innovation

14. LEARNING to CREATE 1. Education 2. Coaching 3. Management advice • Training • Predisposition • Internal-external mapping • Idea generation • Idea assessment • Feasibility study • Idea implementation Third answer: Learning to Create Campus developed Learning to Create, a modular program to develop creativity in working groups • Re-organization • Marketing APPLICATION FIELDS • Strategic planning • New product and service development

15. Learning to Create: example of a creative technique Attributes / Values chain (external mapping) • Examples of Attributes: • Shape • Color • Price • Examples of Values: • Freedom • Imagination • Having fun ATTRIBUTES/VALUES (A/V) MAP EXTERNAL MAPPING

16. Learning to Create: succesfully applied in several EU organizations

17. Conclusions • Organizations must learn to deal with increasing complexity: • Formal and informal • Strategic flexibility • Efficiency and creativity • Campus proposes tools to face these challenges: • Understanding and valorization of informal knowledge and decision flows • Creation of alternative scenarios • Creativity development

18. “The risk is to go to war with the weapons of the previous conflict” Michel Crozier

19. Thanks Mauro De Bona Campus - Innova Group +39 320 6130308 mauro.debona@campusconsulting.it skype: maurodebona