• « What is your organization’s most important asset? CEOs often respond that the organization’s people are its greatest asset. But if this is true, where are people accounted for in the financial statements? Today, people are generally classified as expenses on the income statement and liabilities on the balance sheet — not as an investable asset. Thus, when CEOs seek to increase profit, they cut costs — like people — rather than investing in assets — like people — that can appreciate. « 

    tags: humancapital accounting finance assets intangibles intangiblecapital financialstatements balancesheet

    • In fact, investment advisory firm Ocean Tomo estimates that in 1975 more than 80% of the value in the S&P 500 firms consisted of tangible assets — like land, plant and equipment. In 2010, approximately 80% of the S&P500 market value is attributed to intangible assets. But, today’s accounting systems and financial reporting are still using 20th century definitions, creating a « gap in GAAP » (the Generally Accepted Accounting Principles) on how value is created in the 21st century.
      • In January 1967, the Harvard Business Review published, « Put People on Your Balance Sheet, » which discussed various methodologies for classifying human resources as assets, including:

      • historical cost,
      • replacement cost, and
      • opportunity cost.
  • . By using the Lev-Schwartz model, which calculates today’s value of future compensation to employees of varying ages and experience levels, managers and investors can now track a variety of measures related to Infosys’ human resources, such as « return on human resource value » and « value of human resources per employee. » Infosys’s annual report also includes a « comprehensive intangible assets score sheet » that can be used as a decision-making tool to determine how successful the firm has been at investing in its people from year to year.
  • A key factor in the shift toward viewing people as an asset is recognizing that an employee’s value can appreciate with training, engagement, and teamwork — all investments that are essential for 21st century firms
  • Currently, there are no apparent leading U.S. or European companies performing this calculation — or at least not communicating it to their staff or investors. This powerful, transparent reporting on all the assets of a company has the potential to be a catalyst for developing a set of best practices that will provide a reliable methodology for the measurement and valuation of intangibles.
  • The massive shift towards people as assets to be invested in can ripple through the management systems, goals and aspirations of the firm.
  • Accounting standards will need to ultimately adapt this.  The American Accounting Association analyzed this back in the 1970s, and needs to rekindle this approach.  A new Sustainability Accounting Standards Board (SASB) is undertaking a new approach and educating the SEC as well.
  • « What if the origin of political division in this country could be traced to a simple glitch of the generally accepted accounting practices?
    In other words, charging money for baggage essentially transfers this service from the liability column to the asset column of the accounting statement. As a liability, it can only atrophy under the weight of austerity measures. »

    tags: accounting balancesheet humancapital customerservice service serviceeconomy

    • By charging fees, once neglected baggage service departments have become star revenue performers for airlines. Department managers can now justify new technology and equipment. Where before, baggage service only represented a cost, it now provides millions in revenu
    • The basic problem is that regulators have been working for the last two years to define the difference between hedging and gambling, and can’t.
    • What if that’s what it’s all about; all the fighting, and slander, and division, and prejudice, and injustice, and violence, etc., caused by a simple accounting system problem.
    • When we do not have an accounting system for human values, we can only gamble with them.
  • « After a turbulent spell and a change in leadership the company decided to open up innovation to the community, initially through the Ambassador program created in 2005, allowing not only collaboration with customers but also suppliers that would enable Lego to churn out more advanced products. This modular approach was borrowed from the open source community and allowed manufacturers to design for the Lego ecosystem. »

    tags: casestudies lego innovation openinnovation communities ambassadors customers

    • (1) Use external suppliers to fill in your gaps
    • (2) Utilize the €˜weak ties’ in your community €“
    • (3) Develop clear rules and expectations
    • (4) Make sure both sides win
    • (5) Customers aren’t employees
    • (6) There is no one community member
    • (7) Be open and transparent
  • « Despite all the wonderful things in the second paragraph of his letter that Mr. Sheffer says about GE, Wall Street has had persistently negative view of the firm: GE’s share price has declined by 35 percent over the past ten years. GE is one of three firms in the list (along with Wal-Mart and Johnson & Johnson) that is doing markedly worse than the S&P 500, which is at +32 percent over the ten-year period.

    « 

    tags: GE radicalmanagement casestudies marketvalue innovation outcomes ouputs creativeeconomy

    • Instead of pursuing maximizing shareholder value as most of the Hay “leaders”, like GE, are doing, these firms are focused on delighting customers with continuous innovation. Paradoxically, it turns out that a tight focus on delighting customers makes more money than a tight focus on making money.
    • It’s about understanding the principles of radical management that are needed to succeed in the customer-driven world of the 21st Century marketplace.
    • We know that the 20th Century industrial-style management isn’t adapted to the emerging Creative Economy, in which the driving force is continuous innovation and customer delight. The Creative Economy is an economy in which organizations are agile and continually offering new value to customers and delivering it sooner. The Creative Economy is an economy in which firms focus less on short-term financial returns and more on creating long-term customer value based on trust.
    • The new bottom line of business is: is the customer delighted? It’s a fundamental shift from outputs to outcomes. It’s about, not just finding fast-growing sectors, but rather creating them. Creating fast growing sectors is much more profitable than finding them.
  • « Most customers now ignore targeted marketing campaigns, avoid responding to offers, and provide minimal feedback when asked. Instead, potential customers interact with each other, bypassing sanitized corporate messages devoid of meaning or value.

    Meanwhile, employees increasingly look beyond compensation to non-monetary factors such as advancement, recognition, and corporate social responsibility in choosing where to work. And with the retirement of the Baby Boomers looming, attracting, retaining, and growing the next generation of leaders is an essential task for any organization. »

    tags: marketing humanresources values culture community context stakeholders employees engagement

  • « More companies are applying game mechanics to internal and external apps and processes, Gartner says. But why gaming? Why now? »

    tags: gamification processes businessprocess

    • « The accessibility of information on the Internet and the ability to gather and share information has increased significantly over the past five years, » she said. « Also, you’re competing with other activities that a user might be able to do. How can you make your activity more appealing than other activities? »
    • The idea of game mechanics, said Avey, is taking elements of games and putting them into a normal business process.
    • Gamification can also be used to encourage knowledge sharing, said Avey, and over time it can help users better understand colleagues’ strengths and weaknesses, as well as their areas of expertise.
  • « Aujourd’hui les clients ont plus de pouvoir et sont plus connectés que jamais. Cela appelle une réponse des marques
    Le CRM traditionnel concerne la récupération et la gestion des données clients. Le Social CRM est une stratégie d’engagement des clients
    Les ventes dirige le CRM traditionnel. Les conversations dirigent le Social CRM et les ventes ne sont qu’un sous-produit. »

    tags: crm socialcrm

  •  »
    Crowdsourcing your strategy may sound crazy. But a few pioneering companies are starting to do just that, boosting organizational alignment in the process. Should you join them? »

    tags: strategy socialbusiness crowdsourcing alignment leadership casestudies HCL wikimedia redhat 3M aegon

    • The best way to describe the possibilities of community-based strategy approaches is to show them in action. Two examples demonstrate the lengths to which some companies have already gone in broadening their strategy processes, as well as the degree to which the executives who participated are convinced of the benefits.
    • The solution was to turn the company’s existing business-planning process€”a live meeting called Blueprint, which involved a few hundred top executives€”into an online platform open to thousands of people. The new process, dubbed My Blueprint, was launched in 2009, with 300 HCL managers posting their business plans, each coupled with an audio presentation. More than 8,000 employees (including several members of the teams that had submitted plans) were then invited to review and provide input on the individual blueprints. A surge of advice followed. The inclusive nature of the process helped identify specific ideas for cross-unit collaboration and gave business leaders a chance to obtain detailed and actionable feedback from interested individuals across the company.
    • To ensure accountability for developing the priorities further and for making them actionable, the company tasked a new group of executives to lead teams exploring each of the nine areas. These leaders were senior functional ones whose responsibilities put them a level or two below the C-suite. Each of their teams fleshed out one or two of the most important strategic initiatives and was empowered to execute the plans for them without further approvals.
    • The company invited all of its sales, marketing, and R&D employees to a Web-based forum called InnovationLive, which over a two-week period attracted more than 1,200 participants from over 40 countries and generated more than 700 ideas. The end result was the identification of nine new future markets with an aggregate revenue potential in the tens of billions of dollars. Since then, 3M has held several additional InnovationLive events, and more are on the way.
    • Those employees not only understand the strategy better but are also more motivated to help execute it effectively and more likely to spot emerging opportunities or threats that require quick adjustments.
    • Of course, adopting social-strategy tools doesn’t automatically create alignment. Companies must create it actively, particularly among middle managers, who as the guardians of everyday operations bear the brunt of making any company’s strategy work.
    • The Dutch insurer AEGON sidestepped problems such as these by breaking its strategy discussion into manageable topics related to everyday operational practices. That allowed middle managers to assume responsibility for the discussion and contribute their expertise
    •   

       Taking these principles to their logical conclusion suggests a shift in the strategic-leadership role of the CEO and other members of the C-suite: from “all-knowing decision makers,” who are expected to know everything and tell others what to do, to “social architects,” who spend a lot of time thinking about how to create the processes and incentives that unearth the best thinking and unleash the full potential of all who work at a company

    • For a mass digital dialogue to succeed, people need to express themselves openly, which may leave some participants feeling exposed. Leaders can help by demonstrating vulnerability as well€”peeling off the layers of formal composure.
  • « Kodak has recently declared bankruptcy. Usually, when this hits the news it is analyzed by the numbers people who, looking at five years’ worth of financial data, give their quantitative and financial explanation of the failure. More qualitative types will go back 10 years sometimes, and even go beyond finances to talk about strategy, CEOs, competition, and the like. Recent well-done Financial Times articles (here and here) go back even further for Kodak. And yet people still fail to see Kodak’s real problem. »

    tags: casestudies kodak innovation culture change

    • a new technology has fierce competitors, low margins and cannibalizes your high margin core business. And Kodak did not take decisive action to combat the inevitable challenges.
    • Answer: The organization overflowed with complacency
    • Historically, Kodak was built on a culture of innovation and change. It’s the type of culture that’s full of passionate innovators, already naturally in tune to the urgency surrounding changes in the market and technolog
    • One key to avoiding complacency is to ensure these innovators have a voice with enough volume to be heard (and listened to) at the top
    • As Kodak became more successful, complacency grew, leaders listened less to these voices,
  • « True leadership often comes from people with personal power, regardless of whether they have positional authority [1]. This hack proposes a dynamic system for measuring an individual’s “natural leadership,” — the extent to which their contributions are seen as valuable, both inside and outside of an organization, and publish these results for all to see. This hack borrows concepts from the popular reputational capital sites like Klout.com and Peerindex.com, the Net Promoter methodology, as well as from Gary Hamel’s ideas of how to identify natural leaders [2]. In addition to providing insight into who an organization’s natural leaders are, such a system can provide motivation for employees to make more valuable contributions. »

    tags: management leadership

  • « While a Traditional, born 1945 or earlier, would accept almost any order as long as it came through the proverbial chain of command, Boomers and Gen X might hesitate but comply. But Millennials most likely will balk at doing things “the way we’ve always done it” because they want freedom of choice in everything. They may not balk at the assignment itself but instead may challenge the methodology. »

    tags: humanresources management millenials geny feedback

    • The one positive result in establishing Millennial generational characteristics is this: when we pay attention to their characteristics, we reexamine our management and leadership style, which ultimately brings us full circle: all human beings want to feel good, want to do good work and be recognized for it, and actually are pretty good people. This is not rocket science!
  • « With that in mind, be sure to ask these five questions when considering which social network platform to use: »

    tags: socialsoftware socialnetwork enterprisesocialsoftware

    • 1. What specific tasks do you need it to accomplish?
    • 2. How will the software ease productivity or communication bottlenecks in your organization?
    • 3. Do you want a hosted or installed service?
    • 4. Can the system grow and adapt easily to changing needs and technology?
    • 5. What level of training is required before someone can use the system?
  • « Six Sigma, Kaizen, Lean, and other variations on continuous improvement can be hazardous to your organization’s health. While it may be heresy to say this, recent evidence from Japan and elsewhere suggests that it’s time to question these methods. »

    tags: sixsigma lean kaizen continuousimprovement

    • Looking beyond Japan, iconic six sigma companies in the United States, such as Motorola and GE, have struggled in recent years to be innovation leaders. 3M, which invested heavily in continuous improvement, had to loosen its sigma methodology in order to increase the flow of innovation
    • Customize how and where continuous improvement is applied. One size of continuous improvement doesn’t fit all parts of the organization. The kind of rigor required in a manufacturing environment may be unnecessary, or even destructive, in a research or design shop
    • Question whether processes should be improved, eliminated, or disrupted. Too many continuous improvement projects focus so much on gaining efficiencies that they don’t challenge the basic assumptions of what’s being done
    • Assess the impact on company culture. Take a hard look at the cultural implications of continuous improvement. How do they affect day-to-day behaviors?
  • « The new year is here and businesses everywhere are in the process of developing, refining or finalizing their strategies for 2012. That said, how many organizations are taking a close, in-depth look at their culture as a basis for driving strategy? »

    tags: culture networks strategy hierarchy organizationalcharts

    • honest portrayal of how the fabric of human relationships (and the differences, nuances thereof) = culture.
    • While companies look to their org charts as pathways for executing on strategy, our intuition and experience tells us there are informal channels and relationships that largely dictate how work really gets done. Each company’s ”networks” are different and unique. They can be quite independent of hierarchy and form the basis for culture
    • Understanding informal networks enables leaders to align the organization (not the org chart) with its strategic direction and move more quickly and effectively
  • « « Après le e-learning, le social learning [apprentissage social] est le nouveau concept qui doit révolutionner la formation dans les années à  venir. Cette approche collaborative de la transmission des savoirs a réellement pris son essor avec le développement des réseaux sociaux. Les technologies du web2.0 permettent désormais de regrouper, de structurer et de diffuser les savoirs informels contenus dans une entreprise. Pour le plus grand bénéfice des collaborateurs, qui s’en trouvent plus impliqués et motivés, et des clients, qui voient la compétence de leurs interlocuteurs améliorée. Mais aussi des DRH [ressources humaines], pour qui ce mode de formation collaboratif représente une opportunité peu coûteuse, rapide et efficace de capitaliser les connaissances présentes à  l’intérieur de l’entreprise et d’en favoriser la diffusion. Le social learning devrait venir compléter l’offre existante de formations traditionnelles, présentiel et e-learning, et favoriser l’avènement de l’entreprise collaborative. »

    tags: sociallearning skills competencies

    • « le social learning ne repose pas tant sur le contenu que sur la façon dont on va se connecter aux autres
    • 1. votre mobile sera votre bureau, votre salle de classe et votre concierge, 2. les utilisateurs du web forceront les corporations à  se réinventer, 3. la description de tches pour un dirigeant inclura d’écrire dans un blogue, 4. une littératie des médias sociaux sera requise de tous les employés et 5. la distinction entre le marketing, les communications et l’apprentissage sera confondue.
      • La Apollo Research Institute publiait récemment leurs prédictions quant aux compétences qui seront (sont) requises dans un milieu de travail ouvert, réseauté et collaboratif. En voici une traduction libre :

         

      • Transdisciplinarité €“ cette capacité de comprendre des concepts au travers de divers champs disciplinaires
      • Collaboration virtuelle €“ capacité de travailler efficacement, de susciter l’engagement et de s’afficher comme joueur d’équipe virtuelle
      • Dégager un sens €“ dégager le sens sous-jacent de ce qui est exprimé
      • Intelligence sociale €“ capacité de se «connecter» aux autres afin de susciter les réactions et interactions de qualité
      • Compétence interculturelle €“ savoir travailler dans divers contextes culturels
      • Gestion de la charge cognitive €“ savoir discerner, filtrer et trier l’information abondante et savoir comment optimiser l’usage d’outils de communication pour y arriver
      • Pensée innovante et adaptative €“ proposer des solutions qui vont au-delà  du cadre usuel de raisonnement
      • Pensée rationnelle (« computational») €“ capacité de traduire des données en concepts et comprendre le raisonnement à  base de données.
      • Littératie numérique €“ Evaluer la pertinence et développer des contenus en formats numériques, et utiliser ces nouveaux médias comme effet de levier pour une communication efficace
      • Etat d’esprit «design» €“ savoir représenter et développer des tches ou processus pour atteindre objectifs.
  • « McKinsey’s fifth annual survey on social tools and technologies shows that when integrated into the daily work of employees and adopted on a large scale throughout a new kind of business€”the networked enterprise€”they can improve operations, financial performance, and market share. « 

    tags: socialsoftware usage socialbusiness enterprise2.0 networkedenterprise

  • « But if that’s the case I am sure at this point in time you folks would be probably wondering what’s the new role of leadership then in the world of Social Business? Can we define it nowadays in some sort of form or shape? Or will we have to create a new one altogether? Well, we may not. Once again, we may not need to go ahead and reinvent the wheel, since we may have had it all along over the last few hundred years and we never noticed€¦ Welcome to the Era of Servant Leadership! « 

    tags: management leadership servantleadership

    •  a management philosophy which implies a comprehensive view of the quality of people, work and community spirit. It requires a spiritual understanding of identity, mission, vision and environment. A servant leader is someone who is servant first, who has responsibility to be in the world, and so he contributes to the well-being of people and community. A servant leader looks to the needs of the people and asks himself how he can help them to solve problems and promote personal development. He places his main focus on people, because only content and motivated people are able to reach their targets and to fulfill the set expectations
      • “Business is an ecosystem, not a battlefield
      • A company is a community, not a machine
      • Management is service, not control
      • My employees are my peers, not my children
      • Motivation comes from vision, not from fear
      • Change equals growth, not pain
      • Technology offers empowerment, not automation
      • Work should be fun, not mere toil”
  • « La taille d’une organisation influe sur les modes de prise de décision, de transfert d’information ou de coopération, ce qui fait que les « bonnes recettes » à  10 personnes ne fonctionnent pas forcément à  100 ou encore moins à  1000. Plus précisément, un grand nombre de problèmes apparaissent lorsque la taille augmente, et l’efficacité n’est pas proportionnelle à  la force de travail disponible. Cette constatation n’est pas sans rappeler ce qu’on observe dans les systèmes parallèles (cf. la loi d’Admdhal) qui montre que la puissance que l’on obtient en multipliant les processeurs est compensée par la tche croissante de synchronisation. Ce n’est pas une surprise : les petites structures souffrent moins des problèmes de coordination et de synchronisation ! »

    tags: organization coordination dunbar scale scalability context teams management structure organizationaldesign lean interfaces autonomy SOA complexity networks socialnetworks enterprise2.0 socialbusiness podularity

    • La tentation d’éviter les tares des grandes organisations opérationnelles en les découpant en plus petites est pertinente si le coefficient est faible, et pas forcément efficace dans le cas contraire. Ce qui nous ramène à  la thèse initiale : la bonne organisation dépend du contexte et de la taille.
    • Je pense que la taille de 150 est un seuil critique dans la gestion des organisations, et ceci est conforté par 20 ans de discussions avec des managers opérationnels.
    • C’est ce qui explique qu’en dehors des réunions d’information, il existe des tailles idéales pour des réunions de brainstorming ou de prises de décision, entre 7 et 10.
    • dans le monde complexe du 21e siècle, les activités de communication qui sont nécessaires pour coordonner des tches obtenues par décomposition d’un objectif unique prennent une part sans cesse croissante du temps actif disponible.
    • C’est ce qui explique les limites de la Taylorisation : en décomposant/spécialisant, on multiplie des interfaces qui, contrairement à  la vision mécanique du 20e siècle, exigent des flux d’information de coordination à  complexité quadratique.
    • Dès que l’organisation dépasse une certaine taille, les échanges indirects (qui passent par la médiation d’une autre personne, d’un groupe ou d’un support) dominent les échanges directs.
    • . Si l’on souscrit à  la thèse de March & Simon qu’une des fonctions clés du management est de gérer les flux d’information, il est clair que cette structure de management est forcément sensible à  l’échelle.
    • le management a une responsabilité essentielle dans la transformation de l’entreprise face aux défis de l’agilité et de la complexité.  Il est clair que tout ce que j’écris depuis quelque temps d’appuie sur la « puissance des petites équipes », en particulier les méthodes agiles de développement et le lean software development. En revanche, il ne faut pas s’y tromper, ces bénéfices sont très fortement dépendant de l’échelle et on n’organise pas une grande équipe comme une petite
      • En revanche, tout ne se règle pas par auto-organisation.
      • Il faut donc bénéficier des avantages des « small teams », au sein d’une architecture modulaire semblable à  celle du système d’information
    • « lean management » gère cette problématique avec des équipes autonomes et indépendantes, reliées par des interfaces « dures » (stables et contraignantes).
    • Une des craintes des spécialistes du lean par rapport aux pratiques 2.0 est qu’elles créent des interfaces « molles » et renforce les dépendances.
    • on retrouve les principes du SOA : organiser en termes de services, définis par des interfaces « strictes » pour favoriser l’encapsulation, c’est-à -dire l’autonomie locale
    • Les équipes doivent être organisées au sein d’une structure, avec un véritable management qui joue un rôle, et qui s’appuie sur une culture propre aux grandes organisations, celle de la maîtrise de la complexité.
      •  

         

         

           

        1.  La structure de coordination de l’entreprise €“ en particulier les réseaux créés par l’Entreprise 2.0 – est une structure multi-échelle, elle ne globalise pas les problèmes, mais elle se décline de façon fractale à  des échelles multiples.
    • La science des réseaux sociaux nous enseigne qu’une bonne structure de coordination est « scale-free » dans un sens très particulier qui signifie que la répartition des degrés dans les nœuds de connexion suit une « power law », ce qui implique qu’il existe de nombreux nœuds très connectés
    • Un réseau podulaire est la combinaison de  petits sous-graphes fortement connectés (les pods) dans un maillage plus large
    • On trouve dans cette conclusion une clé d’articulation pour le management : l’autonomie est fournie par l’utilisation de « small teams », le « mastery » est une des ambitions des pratiques du lean, et le management est bien là  pour expliquer et nourrir le « sens »
  • « What happens in a consumer social environment like Facebook is that people “narrate” their lives. So, in a social business environment, workers can learn to “narrate” their work. In a previous post, we argued that social business applications help to make work “observable”, and more recently we’ve argued that a key benefit of social project management (and other social applications) is to “make the invisible, visible”. »

    tags: narration socialbusiness socialprojectmanagement workflow projectmanagement enterprise2.0 report statusmeetings

    • Knowledge processes are notoriously difficult to observe €“ so much so that identifying the current state of a knowledge process is almost impossible
    • In addition, distribute teams lose significant observability that comes from being collocated. However, social business changes both of these issues €“ IF the people executing the process “narrate” it as it happens.
    • In a project execution process, narration typically happens during status reporting meetings, by project managers chasing down people for updates, in daily stand up meetings, etc.
    • In a social project management environment, this can happen via narration by individuals (and by the software itself) on the project activity stream.
    • The same dynamic applies when our project teams narrate the work of a project. We need far fewer status reporting sessions, because everyone is being made aware of things as they happen.
  • « Having had several recent engaging conversations with smart people who I respect, I’ve picked up a hint of exhaustion around usage of the word « social ». Could it be that some who saw the « change » coming years ago are weary of having carried that torch for so many years as we move into the heavy lifting? It’s natural to want to move to the next thing€”but I’m convinced that today we are largely still talking about the « social media » era. The best of « social business » is yet to come in my opinion and we have a lot of work to do in between. »

    tags: socialbusiness socialmedi businessmodel

    • Despite much of the chatter around « social business », the reality is that most organizations are currently dealing with the realities of social media and only a few truly recognize the potential of social business.
    • Business models where new connections are formed to the benefit of both the business, customer and even employee and shareholders are a core tenet of « social business »
    • Having lived and worked during the « Digital Media » and « Digital Business » era, I think we’re scratching the surface as we straddle the worlds between social media and social business today. While there are many similarities to the past, there are also several key differences.
  • « It is time to rethink. Rather than thinking of organization as an imposed structure, plan or design, organization arises from the interactions of interdependent individuals who need to come together. »

    tags: organization process structure agility flexibility information

      • The accumulating failures at organizational agility can be traced to a fundamental but mistaken assumption that organizations are structures guiding, and as a consequence, limiting interaction
      • It is not about hierarchies vs. networks, but about a much deeper change. Organizations are creative, responsive processes and emergent patterns in time. All creative, responsive processes have the capacity to constantly self-organize and re-organize all the time
      • What we still have not understood is that people need to have access to information that no one could predict they would want to know. Even they themselves did not know they needed it €“ before they needed it.
      • We seek organization, but organization is a continuous process, not a structure.
    • Posted from Diigo. The rest of my favorite links are here.