Globally, corporate non-compliance is a serious problem.  Major firms have been involved in well publicized cases that demonstrate how misguided the common explanations are for why employees indulge in illegal acts. 

No compliance program can totally stop undesirable behavior by a small number of workers.  However, behaviorally aware programs have the potential to achieve primary objective of Compliance, namely the reduction of unethical and illegal behavior within the organization. 

To do this, it is crucial to be aware of employee behavior, of which decision-making is the most crucial aspect. Humans can decide in 2 different ways: 

Intuitive, also known in psychology as System 1, makes decisions through associative memory and habit, which makes it difficult to control or change.  The mind offers quick associations, idea after idea connecting with ease. 

Reasoning, which psychologists also refer to as System 2.  It involves using organized thought to solve complex situations such as mathematical problems, or writing paragraphs, or taking decisions that are compound in nature. 

Because System 2 requires more mental effort, people typically rely more on System 1 when making decisions.  The issue with that is, instead of using System 2 to evaluate their decisions made through System 1, people frequently use System 2 to defend decisions made using System 1. 

System 2's inability to stop unethical behavior is studied on the basis of Behavioral Ethics Research, but it does not fully explain it.  Criminology aids us in developing this further. 

According to criminologists, for an unethical act to take place, 3 requirements must be met:

     1. The issue should be a non-communicable issue.

     2. Trust must be betrayed in order to solve the problem.

     3.  Verbalization has to take place.

Effective compliance strategies focus on how employees—the real users—would be impacted rather than how government authorities will react to compliance activities. 

The following 3 cost-effective measures, that businesses may take to stay clear of the ingrained behavior of serving self-interest which leads to compliance infractions, are suggested by Behavioral Strategy in conjunction with Criminological insights:

     1. Bring a Behavioral Expert onboard.

     2. Utilize best practices to eliminate the root cause.

     3. Utilize inducements to control conduct.

These 3 easy measures help the Compliance Program's behavioral effects by defeating employee rationalizations that lead to infractions.

Let's examine the 3 phases' specifics in more depth.

Bring a Behavioral Expert onboard

The goal of this stage is to holistically apply various theories—some of which have been around for a while—to the business, particularly to compliance-related difficulties.  These theories include the dual system of thinking, rationalization, and behavioral ethics.  Companies are just now beginning to understand the importance and efficacy of this technique.

The 1st step in assuring adherence to ethical conduct is hiring an expert externally or training someone within to keep aware of the many areas and their emerging insights into ethical business decision-making.

Utilize best practices to eliminate the root cause

The next step entails using best practices to eradicate the underlying causes of unethical behavior. These practices are motivated by behavioral science, which is at the core of criminology and behavioral ethics.  Examples include preventing violation risk through early declarations, having moderated conversations among employees, and sharing success stories.  If rationalizations are shown to be the main factor contributing to employee misconduct, compliance programs should aim to eradicate them.

Utilize inducements to control conduct

The last phase comprises implementing suitable reward and incentive structures—financial, non-financial, or a combination of both—to favorably affect how individuals inside a company approach compliance.

According to research, the major cause of substantial corporate trust violations typically has less to do with a rogue individual and more to do with organizational segments that are dysfunctional, incompatible, or inconsistent.

Interested in learning more about Ending Non-compliance and Unethical Behavior in companies?  You can download an editable PowerPoint on Corporate Compliance: Ending Unethical Behavior here on the Flevy documents marketplace.

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 “FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients.  In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over!  The quality of the decks available allows me to punch way above my weight–it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd

All firms have as their strategic goals accelerating growth and performance while simultaneously adding value for customers.

Although it is common for managers to place a strong emphasis on financial success, competent managers actively seek out new possibilities to generate value.

If handled wisely, Business Model Diversification enables value generation and may help managers improve performance and broaden the enterprise's objectives.

Any sustainable organization is built on a system of symbiotic organizational efforts to create and extract value—its Business Model.

Business Model Diversification, or the use of several business models for value creation and revenue generation, has become a vital goal for firms hoping to maintain a Competitive Advantage in today's fiercely competitive business world.

Businesses with industry-breakthrough growth vary their Business Models utilizing strategies like Business Model Innovation (BMI), a technique that simultaneously affects both the fundamental business model and the value offer to clients.

BMI is a potent but underutilized instrument that may generate breakthrough development inside the core business of a company.

According to Michael Porter, strategic diversification is about combining activities that efficiently relate to and mutually reinforce one another, forming a system of activities, as opposed to a collection of isolated activities.

It takes a methodical approach to determine which activities fit together inside a Business Model and which activities might be synergistic across Business Models.

MIT Sloan Management Review research developed a methodology for evaluating the effectiveness of diverse Business Models. The methodology helped with the analysis of the Formula 1 car racing sector, the several businesses operated by Amazon Inc., and almost 50 other enterprises.

The following 3 questions served as the foundation for this study:

1. What factors need to be considered while thinking about Business Model Diversification?
2. How can a new Business Model's value be evaluated and optimized so that it may be added to the portfolio?
3. How can the portfolio of Business Models be enhanced over time?

An 8-step approach that takes into account the complementarities in a portfolio of Business Models was created to address these problems. The Business Model Portfolio's multiple activities may be divided up and analyzed using the 8 steps. The visual map for a Business Model Portfolio Analysis is made in the following steps:

1. Identify Business Models
2. Identify Key Resources
3. Identify Key Capabilities
4. Identify Key Performance Indicators (KPIs)
5. Connect Model to Resources & Capabilities
6. Identify Interconnected Resources & Capabilities
7. Analyze
8. Monitor & Maintain

These steps make it possible to visualize the connections between various methods and competencies and their impact on Performance, enhancing the correlation across a portfolio of Business Models.

The following sections go through some specifics of a few processes necessary to creating a strong Business Model Portfolio:

Identify Business Models

The 1st stage in the 8-step process is to list the Business Models used by the organization.

Identify Key Resources

Find out what important resources, such as money or user data, each business model produces.

Identify Key Capabilities

Find the core competencies that each Business Model produces, such as technical and sales competencies.

Interested in learning more about framework for Business Model Diversification?  You can download an editable PowerPoint on Business Model Diversification here on the Flevy documents marketplace.

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– David Coloma, Consulting Area Manager at Cynertia Consulting

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– Roderick Cameron, Founding Partner at SGFE Ltd

 Editor's Note:  If you are interested in becoming an expert on Digital Transformation, take a look at Flevy's Digital Transformation Frameworks offering here.  This is a curated collection of best practice frameworks based on the thought leadership of leading consulting firms, academics, and recognized subject matter experts.  By learning and applying these concepts, you can stay ahead of the curve.  Full details here.

Digital Transformation is now essential for the survival of all organizations, especially businesses.

Adapting organizations to increasingly digital market environments and leveraging digital technologies to improve operations are essential goals for virtually every modern business.

Digital Transformation is typically more challenging than any Change or Transformation program a business may undertake.  The majority of organizations struggle to implement the fundamental changes required for Digital Maturity.

The majority of organizations on the Digital Maturity bandwagon find it difficult to achieve Digital Maturity—the process by which organizations methodically prepare to continuously adapt to ongoing digital change.

The 7-stage Digital Maturity Model can be used to determine an organization's Digital Maturity.  To reach Digital Maturity, the company should be in either phase 6 (Transform) or phase 7 (Improve) of the model, as seen on the following slide.  These 2 phases encompass the "Run" phase of Digital Transformation and Maturity.

Each phase can be distinguished by its technology and KPI-based objectives.  By the time a business reaches Digital Maturity, it employs very advanced technologies, many of which involve Artificial Intelligence, Data Analytics, and Robotic Process Automation.

Achieving Digital Maturity is an ongoing process.  It is a time-consuming procedure that can increase an organization's prospects of survival and advancement.

A limited number of organizations appear to be implementing the fundamental Changes their CEOs deem essential to achieving these objectives.

A survey of 3,500 corporate executives, managers, and analysts from firms throughout the world was conducted; 15 key informant interviews with executives and thought leaders were also done as part of this study.

The MIT Sloan Management Review and Deloitte research conducted the study to identify Digitally Maturing organizations by asking company executives questions that reflected various aspects of Digital Maturity.

• Leaders were tasked with visualizing the ideal organization and rating their own organization accordingly.
• Leaders were asked the “importance of making business digital and how their companies were progressing towards that ideal”.
• Participants were also asked about how their organizations utilize technology to do business in fundamentally different ways.
• In answer to a question from participants asking what their firms could do differently to increase their Digital Maturity, the most prevalent obstacles and errors were highlighted.
• Investigating the proportion of small-scale digital experimentation and enterprise-wide digital projects yielded intriguing data.
• In the research study, the importance of organizational structure in achieving Digital Maturity was also discussed.
• The significance of cultural transformation was also explored, with an emphasis on teamwork and risk aversion.

Leaders were tasked with visualizing an ideal company transformed by Digital Technologies and capabilities that optimize processes, link people throughout the firm, and promote new value-generating Business Models.

The respondents were then asked to rank their own organization on a scale from 1 to 10.  These interviews with key informants produced the following 3 groups:

• Organizations in the Early level of Digital Maturity received a score between 1 and 3.
• Digitally Developing firms were assigned a score between 4 and 6.
• Digitally Maturing enterprises were rated between 7 and 10.

The first and most important issue of the MIT Sloan Management Review and Deloitte investigation was, "How genuinely are firms attempting to become Digitally Mature?" 

Interested in learning more about organizations with Digital Maturity?  You can download an editable PowerPoint on Digital Maturity Primer here on the Flevy documents marketplace. 

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Digital Transformation is being embraced by organizations of all sizes across most industries.  In the Digital Age today, technology creates new opportunities and fundamentally transforms businesses in all aspects—operations, business models, strategies.  It not only enables the business, but also drives its growth and can be a source of Competitive Advantage.

For many industries, COVID-19 has accelerated the timeline for Digital Transformation Programs by multiple years.  Digital Transformation has become a necessity.  Now, to survive in the Low Touch Economy—characterized by social distancing and a minimization of in-person activities—organizations must go digital.  This includes offering digital solutions for both employees (e.g., Remote Work, Virtual Teams, Enterprise Cloud, etc.) and customers (e.g., E-commerce, Social Media, Mobile Apps, etc.). 

Do You Find Value in This Framework?

You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library.  FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives.  Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market.  They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions.  I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power.  For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients.  In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over!  The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd

Editor's Note:  If you are interested in becoming an expert on Digital Transformation, take a look at Flevy's Digital Transformation Frameworks offering here.  This is a curated collection of best practice frameworks based on the thought leadership of leading consulting firms, academics, and recognized subject matter experts.  By learning and applying these concepts, you can stay ahead of the curve.  Full details here.  

Go digital or go home. In order to thrive in the Digital Age, companies must undertake Digital Transformation to not only support strategy and reach consumers, but also modernize and attain excellence in their internal operations and procedures.  Digital Maturity is rapidly becoming a requirement.

However, majority of firms are incapable of strategizing their move to Digital Maturity.  There are, however, businesses that are Digitally Mature or are rapidly evolving in this direction.  Research into the strategies of such firms suggests that Digitally Mature organizations employ the 5 techniques listed below to achieve leadership in this competition:

1. Digital Organization
2. Digital Strategy
3. Digital Experimentation
4. Digital Talent
5. Digital Management

These 5 key practices form the basis of Digital Maturity Strategy.  Let us go a bit more into a few of these recommended practices. 

Digital Organization

Conventional Organizational Structures comprising of functional silos are ineffective in markets that are dynamic and continually changing.  The introduction of cross-functional team structures is a result of a novel approach to organizational structures.  Customary command and control systems based on functional silos impede the market agility required by present conditions.

A study survey characterized firms' Digital Maturity as Early-stage, Developing, and Mature. Nearly 60% of early-stage respondents viewed their firms' management structure and procedures as a hindrance to engaging in Digital business successfully.  In Digitally Maturing organizations, on the other hand, 80% of respondents stated that their executives possessed the necessary knowledge and skills to lead the organization's Digital Strategy. 

Digital Strategy

Effective Digital Strategies are not limited to the application of technology to become more digital; rather, they are designed to find possibilities with the biggest commercial effect.

Consistently, research demonstrates that strategy is the most potent differentiator for Digitally Maturing firms.  Digital Strategies outline how the firm conducts business in light of the market shifts brought about by new Digital technology.

In a poll, 40% of the respondents stated that Digital Strategy and Innovation needed development in order for their organization to raise its level of Digital Maturity.  Digitally Mature organizations (80% of them) had or were expected to have a well-defined and cohesive Strategy, compared to 19 percent of Early-stage companies, according to the study.  According to the research, Digitally Mature firms are 2 times as likely to strategize for at least a 5 year period.

Successfully implementing Digital Strategy requires a focus on Organizational Change and the development of adaptability to rapidly changing Digital environments. 

Digital Experimentation

Almost every company engages in technological experimentation.  However, the scope and size of tests may not always provide results with enterprise-wide implications.  Digitally Mature organizations are able to expand Digital Experiments.

The key to effective experimentation is conceiving of trials for pressing business challenges that will drive enterprise-wide innovation, followed by the execution of smaller experiments that can be scaled up, if successful.

Early-stage corporations are 2.5 times less capable of undertaking small experiments and scaling Innovation enterprise-wide than Digitally Maturing enterprises.  The capability to scale up modest trials is bolstered by an attitude of openness toward failure and the capacity to learn from it.

Interested in learning more about Digital Maturity Strategy?  You can download an editable PowerPoint on Digital Maturity Strategy here on the Flevy documents marketplace. 

Want to Achieve Excellence in Digital Transformation?

Gain the knowledge and develop the expertise to become an expert in Digital Transformation.  Our frameworks are based on the thought leadership of leading consulting firms, academics, and recognized subject matter experts.  Click here for full details.

Digital Transformation is being embraced by organizations of all sizes across most industries.  In the Digital Age today, technology creates new opportunities and fundamentally transforms businesses in all aspects—operations, business models, strategies.  It not only enables the business, but also drives its growth and can be a source of Competitive Advantage. 

For many industries, COVID-19 has accelerated the timeline for Digital Transformation Programs by multiple years.  Digital Transformation has become a necessity.  Now, to survive in the Low Touch Economy—characterized by social distancing and a minimization of in-person activities—organizations must go digital.  This includes offering digital solutions for both employees (e.g. Remote Work, Virtual Teams, Enterprise Cloud, etc.) and customers (e.g. E-commerce, Social Media, Mobile Apps, etc.). 

Do You Find Value in This Framework?

You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library.  FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives.  Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market.  They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions.  I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power.  For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients.  In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over!  The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd

ABMs aid in the implementation of the ABM methodology. By utilizing the ABM approach, we can automate and streamline the time-consuming process of identifying target accounts and reduce the effort, time, and cost required to court these prospective clients.

ABM systems facilitate the generation of most qualified leads, creation of customized purchasing journeys, enhancement of lifetime value of customers, and ensuring a robust pipeline of promising accounts. These solutions can be integrated with other Sales and Marketing systems, such as CRM and Marketing Automation platforms, to better target and prioritize communications with key accounts.

ABM solutions refine Marketing and Sales departments beyond conventional Branding and lead generation strategies. These systems aid in identifying the correct target accounts prior to executing a personalized Marketing Strategy. ABM solutions are used to acquire new customers, cultivate current and future prospects, and grow enterprise accounts.

ABM solutions have the following 4 main functions:

1. Account Management
2. Account Intelligence
3. Account-based Advertising
4. Digital Personalization

Let us delve further into these fundamental functions.

Account Management

ABM solutions' most essential function is robust management of key accounts. ABM Strategy requires strong collaboration between Marketing and Sales, the identification of prospective accounts and their compatibility with our offerings, and immediate feedback on the outcome of negotiations with the account to close the deal. ABM systems record this data, optimize its distribution between various units, and create Marketing or Sales funnels or pipelines.

The ABM software integrates with automation systems for Sales and Marketing and stores customer data in databases. This is achieved by creating a record for the account in the CRM system. ABM offers stringent administrative control over the origin of account information, its updates, duplicate entries, and the absence of data. Account Management Solution allows for the creation of target lists, the termination of unsuitable accounts, purchase decisions, engagement and conversion data storage, and the evaluation of clicks.

Account Intelligence

ABM solutions' subsequent essential function is to evaluate account-relevant data in order to qualify leads. ABM has replaced the traditional "large funnel" with a narrower Marketing funnel based on data and a more targeted evaluation of accounts before they become leads. Account Intelligence solutions enable the qualification of leads through the analysis of important and relevant qualifying data, connect marketers with prospective accounts, and enable the maintenance of a more accurate target account list.

These solutions prioritize sales intelligence information (such as a target account's contact information and organizational structure) and account intelligence information (sector, geography, IT setup, capital spending history, IP addresses, and customer intent data). Typically, Account Intelligence systems are flooded with obsolete or irrelevant information. Advanced Account Intelligence systems circumvent this issue with automatically updated account data feeds. To differentiate purchasing signals from market noise Account Intelligence system manufacturers have developed lead qualification systems to track ideal accounts. They accomplish this by employing distinct company and buying signal criteria, benchmark-based algorithms, and Machine Learning to identify prospects with high close rates or high engagement.

Interested in learning more about the categories of Strategic Priorities and how to communicate them across the organization? You can download an editable PowerPoint on the Strategic Priorities Identification & Analysis here on the Flevy documents marketplace.

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You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library. FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives. Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market. They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions. I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power. For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients. In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over! The quality of the decks available allows me to punch way above my weight — it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd

Traditional B2B marketing typically involves communicating with a large number of prospective customers with the expectation that a small percentage of them will interact with your website and initiate a conversation about your product or service.

Conversely, Conversational Account-based Marketing (ABM) is a proactive and systematic approach to Marketing that leaves nothing to chance. Using a conversational marketing platform, targeted bots, or account-specific advertisements, marketers must initiate a dialogue with prospective customers as soon as they are identified.

Conversational ABM allows for the creation of a seamless experience for prospects, the expansion of opportunities, and the reinforcement of the alignment between Sales and Marketing units.  When potential customers interact with a company’s website, teams:

• Are made aware of the identity and browsing history of accounts via alerts and notifications.
• Greet them when they interact with a particular product or webpage and demonstrate interest in it.
• Respond to their inquiries and secure their loyalty by delivering an exceptional Customer Experience and pertinent content.

To execute Conversational ABM, marketers must master the following 5-step process:

1. Single out target accounts through third-party data and website analytics.
2. Segregate target accounts into appropriate segments.
3. Craft tailored advertisements for individual segments.
4. Emulate the context of tailored ads on your website.
5. Initiate conversation with target accounts by employing custom greeting messages.

Let’s dive deeper into the details of the first 2 phases of Conversational ABM.

Phase 1 – Single Out Target Accounts through 3^rd-party Data and Website Analytics

During the initial phase of Conversational ABM, Marketing and Sales collaborate closely to determine which accounts to target and their relative importance to the organization. The selection of accounts (companies or individuals who are likely to purchase your products) should be based on first-party data (obtained internally by the team or by monitoring website traffic) and third-party data (obtained externally from other sources).

The two types of data enable the creation of a detailed description of your target accounts or the Ideal Customer Profile for your products. The first instance of relevant internet research conducted by an account should indicate a buyer's intent, allowing the marketer to contact the prospective customer (or company) ahead of the competition.

Phase 2 – Segregate Target Accounts into Appropriate Segments

Following this, the potential accounts are segmented based on their shared characteristics. This enables the creation of a customized campaign for each segment, which is significantly easier than creating a campaign for each individual customer. The three most important ways to segment target accounts are:

• By industry – This type of segmentation facilitates the initiation of contact with new accounts. New accounts are influenced and attracted by marketing campaigns that emphasize addressing the account's industry-specific issues.
• By sales approach – Segmentation by sales approach enables the creation of customized campaigns for accounts and the maintenance of contact with accounts that have already received a quote.
• By customer life-cycle – This segmentation permits Marketing to continue exploring upselling opportunities with accounts after the deal has been closed in order to increase their lifetime value (LTV).

Customer Segmentation facilitates marketing budget allocation, resource allocation, and a focus on high-return accounts.

Interested in learning more about the specific phases of Conversational ABM ? You can download an editable PowerPoint on Conversational Account-based Marketing here on the Flevy documents marketplace.

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You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library. FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives. Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market. They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions. I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power. For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients. In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over! The quality of the decks available allows me to punch way above my weight — it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd

With widespread Disruption consistently causing serious risks to the technology infrastructure and Operating Models of organizations, it is an unremitting challenge for senior management to set up a business that is proficient at introducing products and services that are in accordance with consumer needs and of highly desired utility. This can be actually achieved by obtaining the competencies crucial to create top quality, difficult-to-replicate products.

The collective organizational knowledge needed to produce market-winning products or services is referred to as core competencies. Specifically, Core Competencies necessitate the alignment of various manufacturing abilities and the integration of multiple technology streams into the making of final products. In this technological era, the proficiency of senior leaders can be analyzed by their capacity to distinguish, nurture, and take advantage of Core Competencies vital for growth.

The development of Core Competencies needs considerable collaboration, involvement, and determination. To achieve this, experts advise instilling the notion that a company is more than a collection of separate departments.

Prahalad and Hamel, two prominent business scholars, initiated the Core Competency theory, which lays the foundation for how a modern organization should function and delegate. The model requires that leaders see the organization as more than a collection of separate Strategic Business Units (SBUs).

The framework enables management to optimize business and market demands, as well as recognize internal units that are imperative for Business Continuity and non-core functions appropriate for outsourcing.  Leveraging Core Competencies across a company's entire portfolio of technologies and production capabilities, the Core Competence Theory enables the creation of high quality products at a pace quicker than the rivals. The Core Competence Model underscores the incorporation of individual, collective, and applied knowledge, skills, and behaviors.

The Core Competence Theory is advantageous for the organizations because it encourages a culture of collective beliefs, learning, and wisdom, as well as a sense of community among partners and customers.

The Core Competence Model entails four variables listed below:

1. Resources
2. Capabilities
3. Competitive Advantage
4. Strategy

Let's delve into the specifics of these variables.

Resources

The first variable relates to the resources necessary for developing and acquiring competencies and technologies.

Capabilities

The next variable assesses the opportunities available for building Core Competencies.

Competitive Advantage

This variable pertains to overcoming any obstacles in order to attain the highest possible market share for core products.

Interested in learning more about the key variables of the Core Competence Model? You can download an editable PowerPoint on the Core Competence Model here on the Flevy documents marketplace.

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– Roderick Cameron, Founding Partner at SGFE Ltd

Megaprojects have a substantial influence on the economic activity, productivity, social peace, and environment of a nation.  Estimates indicate that 90 percent of Megaprojects are completed late and beyond budget.  Such overruns have an effect not just on a country's budget but also on other factors.

These overruns are caused by technical difficulties, revisions in design and operational requirements, a rise in expenses, disputes over accountability, and new legislation.  The greater the complexity of a project, the more difficult it is to forecast the obstacles, shifting conditions, and unforeseen possibilities that may arise.

Megaprojects are often described as endeavors costing $1 billion or more, requiring many years to conceive and construct, involving several public or private parties, and touching millions of people.

On 6 London megaprojects, research was undertaken with the purpose of synthesizing norms for managing projects, especially megaprojects.  Multiple academic institutions, including University College London, University of Queensland Business School, and Imperial College London, collaborated on the study.

The study benefited from previous, contiguous, and ongoing research conducted by one or more of the authors of the study under evaluation.  The whole duration of the study exceeded 10 years.

High-Speed 1, Heathrow Terminal 5, Infrastructure for the 2012 London Olympics, Crossrail, Heathrow Terminal 2, and the Thames Tideway Tunnel project were among the megaprojects examined in depth.

The management strategy for Megaprojects was shown to benefit from the following 5 rules:

1. Evaluate previous success factors.
2. Allow for surprise occurrences.
3. Test and try first.
4. Adjust and distribute risks aptly.
5. Employ Innovation from beginning to the end.

The rules obtained are relevant not just to the management of megaprojects, but also to the management of smaller projects.  Despite the complexity of large projects with high stakes, the 5 easy rules can help improve their effectiveness.  These criteria allow for adaptability while preserving the stability required to execute projects successfully.

Let's examine some of the rules in a little more detail.

Evaluate previous success factors

This activity involves examining different project sectors and research organizations in order to apply what is learned to one's own project.  It also includes documenting, assessing, and collecting one's own prior experiences and applying them to the current endeavor.

This practice constitutes examining case studies and visiting other project locations.  Additionally, it utilizes Subject Matter Experts to assist with evaluations.

Prepare for surprise occurrences

This rule is about maintaining flexibility and adaptation in teams and contracts to deal with unanticipated occurrences.  Adapting behaviors to successfully deal with unexpected occurrencess and sharing risks in order to accommodate the element of surprise in projects are other components of this strategy.

Test and try first

This rule requires simulation and modeling in order to assess solutions quickly and cheaply.  It also necessitates prior rehearsal in order to generate answers with little flaws.  Trials are undertaken off-site in order to glean a wealth of essential insights that allow Risk Mitigation and Planning in advance.  On-site testing and trials guarantee a seamless transition to the operations team.  

Interested in learning more about Managing Megaprojects?  You can download an editable PowerPoint on Managing Megaprojects here on the Flevy documents marketplace.

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– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients.  In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over!  The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd

Financial insecurity, the unpredictability of regional and global situations, environmental threats, and advancements in technology have caught organizations off guard.  Consequently, many leaders have ended up turning to Scenario Planning to generate potential possible scenarios, in contrast to planning and devising strategy for a single possible circumstance.

Scenarios include plausible, yet unforeseeable situations and challenges.  They encompass various permutations of facts and anticipated social changes. In Scenario Planning, teams of subject matter experts with differing perspectives on possible future outcomes create potential scenarios.

During the 1960s and 1970s, Scenario Planning grew in popularity as a Strategic Planning tool.   It is, today, employed across industries to develop effective, long-standing Strategic Plans. The conventional approach to Scenario Planning permits analysts to generate simulations that senior management can utilize to make essential decisions. The method correlates data (such as political, geographical, and demographic) with trends to identify key drivers, such as financial, environmental, social, and technical facets impacting the organization.

By preparing in advance for anticipated scenarios, organizations can prevent vulnerabilities or mitigate their negative effects more effectively than if they had to deal with actual problems during an emergency. The 1973's oil crisis prompted Royal Dutch/Initial Shell to initiate Scenario Planning. The technique entails identifying factors that interact in multiple ways to produce unanticipated outcomes. It takes into account factors such as new regulations, technology innovation, forward-looking perspectives, and values. The combination of Scenario Planning and Systems Thinking leads to the development of logical scenarios.

Since the late 1960s, a number of types of Scenario Planning have surfaced.  The most widely used are:

• Probabilistic Perspective — Predictions are made in percentage terms or as best- and worst-case scenarios.
• Normative Perspective—Entails imagining how the future is likely to unfold.
• Plausibility Perspective—Recognizes the unpredictability of uncertainty and investigates the sources of turbulence and ambiguity.

The Oxford Approach to Scenario Planning is increasingly utilized on a global scale to examine a variety of scenarios. The technique focuses on two levels:

• Immediate Business Environment: Comprises a business's suppliers, customers, competitors, partners, and other stakeholders.
• External Environment: Encompasses elements beyond the organization's direct control.

Organizations use the Oxford Scenario Planning Approach in a variety of ways to analyze different situations. The Oxford Approach focuses on perceiving and creating practical, rational, and thought-provoking scenarios rather than assigning probabilities to them. Each scenario in the Oxford Approach is a description of potential variations in the organization's external and internal environment, regulations, and trends.

The Oxford Approach to Scenario Planning exhibits 5 key characteristics:

1. Scenario Planning should clearly address the constituents of organizational strategic framework.
2. A minimum number of potential realistic scenarios should be suggested.
3. Scenario Planning counts on redrafting frames and perceptions.
4. The Scenario Planning initiative calls for dedicated resources.
5. Scenario Planning is aimed at assessing various subtle signals.

Now, let's delve deeper into a few of the defining characteristics.

1. Scenario Planning should clearly address the constituents of organizational strategic framework.

In Scenario Planning, the framework around which the organization's strategy is devised is more important than the strategy itself. This framework includes the underlying assumptions that define the strategy's composition, such as the time period under consideration. Other essential components of the framework pertain to the Scenario Planning process itself, including:

• Should the process be cooperative or competitive?
• Should it be a one-off undertaking performed during the annual planning cycle?
• Should the strategy be openly disclosed to all the ranks and files of the organization or kept confidential?

2. A minimum number of potential realistic scenarios should be suggested.

The number of plausible potential scenarios developed using the Oxford Approach to Scenario Planning should be kept to a minimum—ideally not more than 3.

Interested in learning more about the Oxford Approach to Scenario Planning's other characteristics? You can download an editable PowerPoint on Oxford Scenario Planning Approach here on the Flevy documents marketplace.

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“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power.  For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients.  In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over!  The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd

Solving issues, particularly complicated ones, requires not just accurate problem formulation but also an organized method to supplement it.

Structured Problem Solving is merely an iterative sequence of formulating hypotheses and evaluating them via controlled experiments that has been adapted for the complexities of the real world.

Structured Problem Solving is a formal, logical, and systematic technique to arranging the thought processes of humans.

To assist us solve an issue in an organized manner, our method, i.e., a logical framework, must break the problem down into smaller, more manageable parts.

There are several frameworks for Problem Solving, including Root Cause Analysis (RCA), 8 Disciplines (8D), Fishbone (or Ishikawa) Analysis, and Plan-Do-Check-Act (PDCA), among others. It is far more important to ensure that a Structured Problem Solving approach is employed to handle difficulties than to examine the precise method to apply.

Toyota's A3 Form is one of the most ubiquitous Problem Solving approaches adapted in many sectors throughout the world.  By condensing the Structured Problem Solving exercise into a single sheet, Toyota devised the A3 Form to facilitate knowledge-sharing throughout its operations.

Using a hybrid approach to Problem Solving, a team of consultants has changed this form to make it industry-agnostic.  A number of businesses have used Toyota's A3 Form to tackle challenges in settings other than manufacturing.

This hybrid method to Problem Solving is both basic and effective.  The Modified A3 technique to Structured Problem Solving consists of 6 steps.

1. Problem Statement
2. Current Design
3. Root Causes
4. Target Design
5. Goals & Leadership Guidelines
6. Execution Plan 

Each primary step is followed by a subsidiary phase.  Even if there is supporting material, restricting the project overview to a single page forces users to be extremely precise in their reasoning.

Let's go a bit more into some of the steps of this Problem Solving approach.

Problem Statement

The 1^st phase of the Modified A3 Structured Problem Solving approach is to formulate a specific Problem Statement.  Background information for every problem is crucial; thus, adequate information should be included to clearly tie the Problem Statement to the larger mission and objectives.

Current Design

The next phase of the A3 method is to document the current design of the process by seeing the task being performed in person.  People, in general, and those who perform repetitive work on automated processes in particular, find it difficult to accurately describe how they accomplish their tasks and the nature of the challenge they confront.  It is the manager's responsibility to thoroughly supervise the work of such individuals and investigate the source of the problem, as the individuals themselves are incapable of doing so.

Root Causes

Examining Root Causes and using Conscious Processing by relating the observations to the Problem Statement is the third phase.  All Root Cause techniques are intended to help understand how the identified problem is anchored in the Current Design of the work system.

Target Design

Using the Target Design section of the A3 Form, the next step is to recommend an upgraded system to fix the issue.  The modification to the work system may require a simple or complex series of procedures.  Rarely will the needed adjustments constitute a whole new program or endeavor.  Changes must be clear, well-targeted modifications resulting from the Root Cause investigation.

Interested in learning more about Structured Problem Solving: Modified A3?  You can download an editable PowerPoint on Structured Problem Solving: Modified A3 here on the Flevy documents marketplace.

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You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library.  FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives. Here’s what some have to say:

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– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power. For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients. In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over! The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd

Necessity to accelerate Innovation, is not restricted to a certain industry.  Existing businesses in a variety of industries are acutely aware of the competitive threats posed by their inadequate Innovation chains.  In addition, they are aware of the speed with which startups might adopt new technology.

This understanding spawned the Open Corporate Accelerators (OCA) model, which requires less capital commitment than the standard Corporate Accelerator approach.

Typically, a single business initiates traditional Corporate Accelerators for its own benefit.  OCAs, on the other hand, accept several sponsors and can tempt a greater number of better mature firms.

OCAs may include academic institutions, corporate sponsors, Original Equipment Manufacturers (OEMs), suppliers, and businesses from many industries.

There are 4 significant distinctions distinguishing an OCA from a typical CA:

1. As is the case with Open Innovation programs, sponsors lose ultimate control over the platform's program architecture and subject matter.
2. Individual sponsors lose brand visibility under an OCA model due to the non-exclusivity of sponsorships.
3. Sponsors might use OCAs to fill particular gaps in their products or processes rather than pursuing broad Innovation, whose initial suitability is uncertain.
4. Due to the mass involvement of sponsors and solution providers in an OCA, the novel solution loses its exclusivity.

Sponsors may leverage on the OCA model's Innovation opportunities by adhering to 3 best practices.

1. Develop assurance internally for outside Innovation.
2. Willingly take up cooperation with competing companies (co-opetition).
3. Select areas to pursue. 

OCA also reduces the ambiguity involved with collaborations with early-stage startups with untested technologies, resulting in faster, more effective deployments.

Open Corporate Accelerators follow a similar 3-phase structure as conventional Corporate Accelerators.

1. Search and Selection
2. Solution Conversion
3. Solution Assimilation

Let's explore the stages in further depth.

Search and Selection

In phase 1 of the OCA process, it is difficult to match startup technology with BU needs.

This may be achieved by conducting periodic events devoted to certain technology, where entrepreneurs meet with relevant BUs.

Solution Conversion

The most difficult aspect of the 2^nd step of the OCA procedure is proving that a startup's solution perfectly meets the sponsor's needs.  Startups learn that satisfying sponsors' development requirements is difficult, especially in terms of quality and timeliness requirements.

By requiring startups and BUs to collaboratively create and manage Proof-of-Concept (POC) initiatives, these obstacles can be addressed.

Solution Assimilation

The key problem of the 3^rd and final phase is scaling up the solution.  Startups typically have several initiatives and are under significant pressure to marshal and schedule the necessary resources to achieve scalability.

Proof-Of-Concept initiatives aid in determining if a solution is beneficial or not.  Effective transition from solution adaption to assimilation is accomplished by ensuring that the startup's solution and team are firmly rooted within the sponsoring enterprise.

Interested in learning more about Open Corporate Accelerator (OCA)?  You can download an editable PowerPoint on Open Corporate Accelerator (OCA) here on the Flevy documents marketplace.

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– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power. For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients. In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over! The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd

Managing any organization may be characterized as a perpetual stream of problems that must be controlled and resolved.  However, individuals frequently choose to rapidly implement solutions without first taking the time and making the effort to fully comprehend and assess the nature of the situation at hand.

Thus, organizations invest a great deal of time, effort, and money without knowing precisely how the exercise will benefit them.

The demand to precisely identify the organization's most important problem requiring a remedy, is a genuine one.  A company that can effectively execute change on a regular basis will be an industry leader, if it is able to precisely describe the issue.

Decades of research indicate that the human mind has at least 2 distinct methods for attempted Problem Solving.  Both the person's current position and the surrounding environment will determine which strategy will prevail. These 2 methods of Problem Solving are:

1. Automatic Processing—occurs when humans have no control over the processing and are unaware that it is taking place.
2. Conscious Processing—represents the portion or function of the brain that a person has control over.

These 2 methods tackle issues differently and at different pace.  A growing body of studies indicates that it is advantageous to distinguish between the 2 modes of thought.

Structured Problem Solving is associated with the 2nd process, namely Conscious Processing.  Structured Problem Solving entails constructing a logical argument that links observed facts to underlying causes and, eventually, a solution.

The formation of an effective chain of clarity begins with a coherent statement of the issue.  A quality Problem Statement should have the following five elements:

1. Importance
2. Problem-Solution Gap
3. Quantification
4. Neutrality
5. Scope

Developing a Problem Statement increases the likelihood of maximizing the benefits of Conscious Processing and may also set the stage for inducing and subsequently evaluating an "Aha!" moment.

Let's examine these components in further depth.

Importance

Importance refers to the Problem Statement's capacity to identify a characteristic that is crucial to an organization and connect that feature to a well-defined and unique objective.  This is only achievable if there is a direct link between the Problem Statement and the organization's larger mission and objectives.  The temptation of focusing on unimportant topics from the beginning should be avoided, and attention should concentrate on the essentials.

Problem-Solution Gap

A solid Problem Statement should include a cogent explanation of the Gap between the current circumstance and the desired outcome.  When people have clear and easily comprehensible objectives in front of them, they are more focused and exert greater effort.  A proper Problem Statement facilitates this concentration by defining the Gap that must be filled.

Quantification

Effective Problem Statements should quantify key factors, such as the objective, the current circumstance, and the gap.  Quantification of a characteristic just indicates that it has a clear direction, i.e., that more of it is either beneficial or detrimental.

Neutrality

A good Problem Statement should retain Neutrality with respect to probable diagnoses or remedies.  During problem formulation, as few assumptions about the origin of an issue should be made as is practically practicable.

Scope

A Problem Statement's Scope should be succinct enough to be addressed quickly.

Interested in learning more about the 5 Elements of a Problem Statement?  You can download an editable PowerPoint on 5 Elements of a Problem Statement here on the Flevy documents marketplace.

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– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power. For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients. In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over! The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd

For big multinational organizations, building fruitful collaborations with potential startups is a considerably more difficult task than it initially appears.  Global enterprises sometimes struggle to find potentially favorable startup partners.

Given the vast hierarchies of multinational firms,it is extremely difficult for startups to identify and engage the key decision makers.  These challenges are exacerbated in Emerging Markets.

Emerging Markets are defined as fast expanding markets that exhibit characteristics of developed markets, but have yet to reach the full criteria of a developed market.  In the past, Emerging Markets may have already been developed markets.

Such markets are believed to offer more profit opportunities, but also carry a greater risk due to a variety of other factors. Countries with Emerging Market category are considered to be between developing and developed.

Even for large global organizations, forming successful alliances with innovative startups is a difficult task.  According to a study on effective partnerships between multinational corporations and startups in Emerging Markets, there are 4 essential variables that influence the connection. 

1. Immaturity of the Entrepreneurial Ecosystem 
2. Appetite for Entrepreneurship 
3. Outsider Status of Western Multinationals 
4. Access to Novel Innovations 

Research on multinational firms' partnerships with startups in Emerging Markets was also able to identify 4 strategies, 1 for each key factor, to address the partnership engagement issue.

Certain criteria may be more influential than others for a specific multinational firm, but all 4 play a role.

Let's delve a little more into the strategies associated with each element. 

Compensate for the immaturity of the entrepreneurial ecosystem.

Due to the immaturity of the entrepreneurial ecosystem, a substantial number of Emerging Markets are plagued with institutional constraints and voids.  Some refer to this issue as the "last mile" issue.  To ensure the fulfilment of obligations by each partner, such circumstances necessitate the formation of trustworthy alliances.  The greater weight of compensating for the shortcomings of the entrepreneurial ecosystem falls on the shoulders of multinational firms seeking to enter such areas. 

Commit resources to tapping the entrepreneurial energy in Emerging Markets.

Despite the constraints of Emerging Markets, there is a need for entrepreneurship due to the number of opportunities in these markets.  In a few instances, thriving growth firms have energized startup ecosystems in Emerging Markets.  In these Emerging Markets, global corporations can locate their accelerators.  This dedication might develop a multitude of networking and partnership initiatives in the Emerging Markets among all parties. 

Work with local groups to overcome the limitations of outsider status.

In foreign markets, unfamiliar conditions are a given, but in Emerging Markets, the lack of information regarding local conditions is amplified, giving global corporations the status of outsiders.  Such problems can be overcome by partnering with institutions that are familiar with the local environment, such as incubators that collaborate with local governments and companies. 

Co-innovate with startups to access novel technologies.

The decreased cost base and huge market size of Emerging Markets are fundamental attractions for global corporations.  Local innovation discovery can also be an advantage for multinational corporations.  The limitations of Emerging Markets force entrepreneurs in these markets to employ concepts that cannot be conceived in developed nations.  Through co-innovation projects in Emerging Markets, global corporations can also utilize innovative technologies.

Interested in learning more about Partnerships with Emerging Market Startups?  You can download an editable PowerPoint on Partnerships with Emerging Market Startups here on the Flevy documents marketplace.

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You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library.  FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives.  Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market. They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions.  I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power.  For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients.  In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over!  The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd

At all levels of a corporation, key decisions have to be made quickly. This is particularly critical at the strategic level, when senior executives are expected to have an exceptional talent for systematic and organized decision-making. However, this is not simple, and there is also no clear path to follow.

There is a plethora of studies and thought leadership around formulating and implementing strategy—but little on maturing into a leader with exceptional judgment abilities. Chief Executive Officers are frequently asked to develop their own executive on-the-job training programs for their managers and key executives in order to sharpen their strategic thinking and judgment abilities.

While making decisions, executives must make trade-offs, weighing the numerous available options. Executives find it difficult to choose the most viable option from a finite number of possibilities, as they want to keep all of their options open.

For leaders, Decision Making Acumen is a matter of survival. For CEOs, for example, it is critical to do a detailed evaluation of the benefits and drawbacks of entering a certain market prior to forwarding the case to the board for approval. They must determine which geographies to select and how to do so.

The ability to make smart decisions enables individuals to consider the big picture and think long term rather than focus primarily on short-term rewards. Executives with Decision Making Acumen are able to say no to poor business decisions.

An organized approach is essential to develop CEOs' judgment and decision-making abilities. Such a systematic approach to increasing an executive's Decision Making Acumen should include the following components:

1. Grasp on Reality
2. Strategic Choice Cascade

Understanding these two components enables CEOs to establish priorities, communicate their reasoning clearly, stay firm in their judgments, and encourage others to follow.

Now, let us explain why it is critical for leaders to have a clear grasp on reality as they develop Decision Making Acumen.

Grasp on Reality

Executives frequently have an inclination to perceive evidence in a way that conforms to their established views. This cognitive bias can cause them to misjudge situations. The first component of the strategy emphasizes the critical nature of removing biases and preconceived notions from the decision-making process. Executives with Decision Making Acumen make conclusions after doing a thorough study of the matter, setting aside personal biases and accepting facts.

Preconceived assumptions and a refusal to accept reality results in failures. For instance, under the assumption that expanding into economies such as Brazil would be simple due to innovation and brand equity in other markets, Proctor and Gamble invested extensively in the country to establish the distribution of their oral care business. P&G was unaware that Colgate had invested twice as much in the oral-care business and had created a huge distribution network in Brazil, resulting in enormous brand loyalty for its products. This mistake cost P&G millions of dollars in market share and forced the company's executives to rethink their growth strategy.

Interested in learning more about the other element of the systematic approach to Decision Making?  You can download an editable PowerPoint on Executive Decision Making Acumen here on the Flevy documents marketplace.

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You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library.  FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives. Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market.  They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions.  I strongly recommend FlevyPro to any consultant serious about success.”

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– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients.  In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over!  The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd

Selecting ground-breaking new projects for additional investment and expansion is risky and difficult, as new ideas are fraught with technological and market uncertainty. There will always be winners and losers in the process of evaluating Capital Investment projects for funding, but no one wants to be the decision-maker who missed a fantastic investment opportunity.

According to research, project selections can go wrong as a result of the following 5 issues within the expert panel formed to select the project:

• Predisposition toward novel concepts.
• Expert panels are devoid of diversity.
• More emphasis on technical aspects.
• The panelist's bias in introducing the project.
• Timing.

A well-chosen R&D project can revitalize an organization's product lines, processes, and services, as well as improve its functioning and competitiveness.

Leaders must understand the areas in which R&D selection panels may make errors in order to improve their performance in selecting appropriate projects. Research demonstrates that by recognizing potential pitfalls and optimizing the process, organizations can make more informed decisions and achieve superior results.

There are several techniques that can be used prior to, during, and after selecting strategic initiatives to mitigate biases and improve investment selections. By following the best practices outlined below prior to, during, and after selection, decision-makers can make more informed decisions about which projects to invest in:

Pre-selection

1. Conceal Names & Demographics
2. Homogenize Submissions (Heilmeier Catechism)

During Selection

3. Pursue Diversity
4. Apply Crowdsourcing
5. Adopt Workshop Approach
6. Entrust to Probability
7. Organize One-on-one Contests

Post-selection

8. Give Feedback
9. Gain from Failures

While these procedures will require some resources and effort, they are expected to be less expensive than the traditional method of selection, which heavily relies on the time and effort of senior managers and technical subject matter experts.

Let us consider some of the best practices in a little greater detail.

Conceal Names & Demographics

One way to eliminate bias is to conceal the names and demographic information of those submitting proposals for strategic initiatives. According to limited research, concealing women's names and demographic characteristics in science submissions increases their chances of receiving grants.
While masking name and demographic information in submissions is an important first step, organizations may need to take additional measures to detect bias.

Homogenize Submissions (Heilmeier Catechism)

Comparability is necessary for projects with similar themes. A standardized approach to proposal development simplifies evaluation of initiatives. Comparability can be facilitated through the use of a comprehensive, uniform template for proposals. This was demonstrated in the mid-1970s by George Heilmeier, director of a US research organization.
Heilmeier Catechism is also used as a screening technique to assist project proposers in determining the viability of their ideas.

Pursue Diversity

A more diverse selection panel helps to mitigate biases and also results in products that are more appealing to people with a range of requirements and interests.
Diversification has been demonstrated to be critical in a variety of ways—not just in terms of demographic characteristics, but also in terms of professional capability and background.

Interested in learning more about Project Investment Selection Best Practices?  You can download an editable PowerPoint on Project Investment Selection here on the Flevy documents marketplace.

Do You Find Value in This Framework?

You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library.  FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives.  Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market.  They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions.  I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power.  For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients.  In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over!  The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd

Recessions compel leaders of practically all organizations around the world to consider the consequences of a deeply disruptive crisis.

When confronted with a crisis, some leaders shine, causing their companies to grow stronger. Some appear to be stumbling. Others are merely bystanders while their organizations crumble.

Organizations that survive major disruptions are likely to emerge stronger and better prepared to predict and prepare for the next one.

Leaders of organizations are ultimately responsible for Managing Disruption, regardless of the cause. The most significant role is that of the organization's head.

Leaders of organizations who use the following 3-phase systematic strategy will be the most effective during times of disruption:

1. Anticipate & Prepare
2. Plan & Respond
3. Implement & Sustain

Top executive must recognize Disruption's dynamics, forecast its potential consequences, devise a plan to respond to it, govern that response, and maintain the necessary changes.

Let's delve a little more into each phase's specifics. 

Anticipate & Prepare

This entails determining the likelihood of a negative event as well as the potential consequences. The other element of this process is preparing for it, which necessitates keeping the level of preparation proportional to the risk's nature and probability.

While it is impossible to predict every disruption, anticipating the kind of disruptions that may be particularly harmful and preparing for them accordingly is a possibility.

Risk management and disruption anticipation should be distinguished between, clearly. Risks that businesses believe they are protected from due to their competencies and capabilities should be examined more closely.

Only the organization's top boss can get around these constraints by learning to ask better questions at many levels of the business and looking ahead rather than depending solely on historical data. 

Plan & Respond

This phase necessitates ensuring that there is a clearly stated target and a compelling purpose for it, devising a viable and reliable plan for achieving that objective, and persistently and realistically pursuing it.

The organization's leader is responsible for forming a response to the disruption; leading from the front is crucial for effectively handling a disruptive event. All stakeholders should be consulted without bias and with humility, and all viewpoints should be listened to with an open mind by the organization's leader.

After careful deliberation, the leader should issue a response that clearly states what actions are required, who is responsible for them, and when they must be completed. 

Implement & Sustain

One aspect of the process is quickly implementing changes by carefully matching senior executives' capabilities to tasks; the more laborious and crucial part is sustaining such changes so that they take root and become the norm.

When confronted with a business crisis, organizations often commence appropriate solutions, but are unable or unwilling to see them through. In such cases, the problems that hampered the response go unaddressed, and the organization becomes even more unprepared for the next crisis.

To implement change and sustain a company amid disruption, both the Organizational Design and the Organizational Culture must be carefully examined.

It is the job of the organization's leader to guarantee that the structure and culture are ready for the necessary changes and are set up to support the new strategies and each other. 

Interested in learning more about Managing Disruption?  You can download an editable PowerPoint on Managing Disruption here on the Flevy documents marketplace. 

Do You Find Value in This Framework?

You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library.  FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives.  Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market.  They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions.  I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power.  For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients.  In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over!  The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd

Disruptive change has put a tremendous strain on organizations and their IT departments.  The capabilities of the IT talent is declining due to inadequate technical education and aging workforce.  Legacy systems and diverse IT applications are frequent across most organizations.  Mergers and Acquisitions have become a norm, pushing vendors to form alliances.  Mobile devices, tablets, and social media have been quite common across employees of almost all organizations.  Cloud Computing and software-as-a-service (SAAS) have further complicated IT strategies, facilitation of Information Security, and keeping costs under control.

Systems to capture real-time data and using it to make informed decisions and provide personalized responses to customers (predictive analysis) will become a necessity in future.  Organizations that will not equip themselves with these systems quickly will simply end up outsourcing to companies able to provide such services inexpensively and efficiently.

Due to these factors, leadership of the IT units is under immense pressure to revamp their IT function, to deliver advanced functionalities, stay abreast of Innovation, curtail costs, provide superior customer experiences, and gain distinct Competitive Advantage.

IT Redesign does not work merely by following generic recommendations of pundits from leading IT companies.  It necessitates following a systematic process of clearly directing the unit’s focus on the value propositions of the company.  To accomplish this, IT leadership needs to first analyze their existing service or product offerings and evaluate the value they generate.

The IT function of an organization can generate value in 6 ways—the key Value Drivers—by using efficient deployment of technology.  These Value Drivers assist the technology leadership in their role to facilitate in providing capabilities the business needs most:

1. Cost-effectiveness
2. Quality
3. Responsiveness
4. Aggregation
5. Agility
6. Innovation

A dedicated commitment to the delivery of these 6 value drivers enhances the impact of the IT unit tremendously.  Let’s discuss these value drivers in a bit detail.

Cost-effectiveness

Managing IT related costs is the foremost driver of value for the IT function.  This value driver demands commitment from the leadership to:

• Keep IT related costs lower than those of rivals.
• Reliably enhance the cost indicators.
• Finance initiatives to build distinctive capabilities.
• Curtail spending in activities not adding value for the enterprise.

For example, a renowned retail supermarket has in place a sole straightforward yet reliable IT system to track and manage all functions.  The system monitors all expenditures and allows investing only in initiatives that positively impact its critical capabilities (e.g. superior customer service).

Quality

This driver of value for the IT function warrants maintaining high standards of quality of service / products.  The driver warrants commitment from the leaders to:

• Consistently achieve or exceed the agreed upon—or standard—service or product quality levels.
• Conform to security, confidentiality, and regulatory standards, risk management protocols, and operational guidelines.

For instance, a large global industrial corporation employs customized Robotics and Supply Chain Management applications to develop and manage outstanding Operational Excellence capabilities of their people.

Responsiveness

This value driver demands consistently high levels of engagement across the different departments of the company.  The driver warrants commitment from the leaders to:

• Maintain efficient service delivery, candid communication, and high-degree of engagement with internal stakeholders.
• Collaborate and partner with all other units of the organization to prepare realistic estimates and interpret changing internal demand patterns.
• Stay informed of the organizational-level requirements, objectives, and priorities.

For example, in order for financial institutions to serve their consumers better and thrive in this age, it is imperative to transform their Strategy and operations.  This entails enabling rigorous cooperation and harmony between the business and IT departments to ensure that the back office operations fully facilitate front office functions.

Interested in learning more about Information Technology (IT) Redesign?  You can download an editable PowerPoint on Information Technology (IT) Redesign here on the Flevy documents marketplace.

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You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library.  FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives. Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market.  They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions.  I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power.  For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients.  In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over!  The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd

The role of corporate functions, traditionally, has been to conduct the various service-oriented specialized tasks necessary to run the business.  Corporate functions are of strategic significance in achieving organizational objectives yet their role at most enterprises is kind of contractual at best.  These units assist in routine operations, facilitate other business units, and manage conflicts and relevant pressing matters.  For instance, the Human Resources (HR) function is typically responsible for staffing people, administering their benefits, managing performance appraisals, and career advancement procedures.

Constant pressure on businesses to compete in this age of disruption has forced them to rethink the role of their Corporate Functions.  Lately, the expectations from corporate functions have evolved to the degree where the Leadership anticipates the support functions to be of more value for the company.  These corporate functions are now required to align more strategically and directly with the Corporate Functional Strategy.

To undergo Transformation, businesses should act quickly to tap value offered by these 4 key opportunities:

1. Change in Market Environments
2. Increased Focus on Discretionary Activities
3. Increased Pressure on Process Improvement
4. Development of Distinctive Capabilities

Let’s delve deeper into these key opportunities.

Change in Market Environments

Markets are becoming more and more volatile, uncertain, and rife with innovative rivals.  In addition, the constantly shifting customer demands are forcing organizations to put more pressure on strategic as well as support functions.  This demands from these functions to develop expertise in order to deliver on more complex tasks than in the past.  For instance, IT needs to be able to now design applications capable of unearthing vast data lakes to reveal valuable insights in real-time.

Increased Focus on Discretionary Activities

Traditional corporate functions were more occupied with routine operational activities—resolving financial errors, emailing, overseeing employee compensation, and managing IT assets.  However, now, thanks to Process Optimization and Outsourcing, Corporate Functions have become efficient to the point that they have slashed the requirement for resources to deal with routine activities significantly.  This has freed immense resources, leaders’ time and effort to be spent on discretionary strategic initiatives that have the potential to bring more value for the organization.

Increased Pressure on Process Improvement

Changing market dynamics and intensifying rivalry has strained the organizations to ensure seamless implementation of strategic initiatives, boost effectiveness, and bring on Operational Excellence.  This competitive landscape has forced the functional leadership to reduce expenditures, find new avenues of operational improvement, and enhance value.

Development of Distinctive Capabilities

The changing market dynamics have made the companies realize the significance of creating unique capabilities—differential edge acquired due to the ability to do things remarkably and inimitably. Organizations are now more focused on empowering their global corporate employees.  The Corporate Functions have now become more and more important for the organization’s Corporate Strategy.  Rather than just assessing fulfillment of requests from the team members, rewards and recognition of functional leaders is now being tied more with their efficiency, judgment, ability to create key differentiators for the organization, and finding efficient ways of doing business.

Organizations are now more focused on empowering their global corporate employees.  Rather than just assessing fulfillment of requests from the team members, rewards and recognition of functional leaders is now being tied more with their efficiency, judgment, ability to create key differentiators for the organization, and finding efficient ways of doing business.

Interested in learning more about Corporate Functional Strategy?  You can download an editable PowerPoint on Functional Strategy here on the Flevy documents marketplace.

Do You Find Value in This Framework?

You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library.  FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives. Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market.  They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions.  I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power.  For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients.  In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over!  The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd