New Theme Paper for Global Convention Questions Contemporary Approaches to Governance

London Global Convention 2013, incorporating the13th International Conference on Corporate Governance and Sustainability

Theme Paper

CORPORATE GOVERNANCE AND SUSTAINABILITY:
A TIME FOR REASSESSMENT?

Prof. Colin Coulson-Thomas*

Corporate governance and sustainability have been advocated for a generation. There are initiatives, policies, guidelines and codes of practice in many countries. Both governance and sustainability are topics of study at Universities. They have been much discussed, but how much of the rhetoric has impacted upon corporate and social reality? Have boards become more effective? Are they adding more value?

In the case of boardroom debates and decisions, have corporate policies been implemented? Have words resulted in deeds that have made a difference? Have aspirations led to beneficial outcomes? Have good intentions and well meaning pronouncements resulted in practical action and changes of behaviour? In relation to sustainability, are companies engaging with their employees, suppliers and customers and helping them to select and adopt more responsible and sustainable options?

Are the paths that we have chosen to confront particular governance and sustainability challenges the right ones? Are contemporary approaches delivering or are they just cosmetic? Are they fit for purpose? Have they been a distraction? Are directors and boards overlooking more practical steps that could lead more quickly to greater impacts? Is a reassessment and/or a change of balance, emphasis and focus required?

The 2013 London Global Convention which incorporates the13th International Conference on Corporate Governance and Sustainability represents an opportunity to address these and related questions. We need to rethink both governance and sustainability and adopt new approaches and practices as well as revisit the value of codes if we are to increase their beneficial impacts.

REASSESSING GOVERNANCE

Since the publication of a succession of reports on corporate governance there have been visible corporate collapses. Governments have had to step in to prevent a meltdown of financial institutions that observed governance codes and obtained a clean bill of health in relation to most principles of good corporate governance set out in such documents. Has faith in corporate governance been misplaced?

A key question which has already been raised is: Does good corporate governance matter? (Alucha, 2009). Does corporate governance as it is currently practised actually lead to sought after changes of behaviour? Has it been the latest in a succession of fashions? Will it go the way of other past management fads?

Is there a problem of implementation or with the approaches to governance that have been adopted? Can they be revised and improved? Do we need to look for and adopt complementary pieces of the jigsaw puzzle to build more effective boards and more sustainable companies? Some might argue that there has been greater impact in certain areas than others. Has a block been put in place that can be built upon?

The context in which some companies operate has significantly changed. Legal duties and responsibilities have been clarified and/or extended, according to jurisdiction. For many boards there is now greater insecurity and uncertainty. In addition to pressures from shareholders for profitability, has awareness of responsibilities to other stakeholders grown? Is there greater concern for sustainable operations and strategies?

Sustainability has become a strategic issue for many companies in a number of arenas ranging from sources of supply to corporate impacts. How boards – either individually or collectively – handle sustainability and environmental challenges and opportunities is an indicator of their effectiveness (Coulson-Thomas, 2012b & 2013a).

CHALLENGING ASSUMPTIONS

The distinction between direction and management is an important one (Coulson-Thomas, 1993). Boards need to consider their own and management’s roles and responsibilities, and determine the extent of delegation. A key question is the extent to which a board should help the executive team to implement strategy as well as formulate it (Bordean et al, 2011). Much will depend upon the nature of the strategy and context, and the calibre of the CEO and the executive team.

A board should focus upon providing strategic direction and not interfere in operational matters that ought to be the concern of the management team. However, concentrating upon the ‘big picture’ should include seeking assurance that board policies are being implemented and that a management team is taking appropriate steps to seize opportunities, address challenges and remain current and vital. A board should inspire action and monitor achievement.

Where there are concerns directors should probe and challenge. Far too many companies have initiated expensive, disruptive and multi-year change and transformation programmes and various single-issue corporate initiatives that have failed to deliver, while overlooking more cost-effective ways of delivering multiple corporate objectives (Coulson-Thomas, 2012e & 2013e). One should not necessarily follow the herd if a more affordable route to a high performance organisation exists.

A good example of groupthink (Janis, 1972) and preoccupation with grand initiatives is the championing of culture change. In a desire to address ‘root causes’ many boards are endeavouring to ‘change’ a corporate culture, despite this being a problematic activity (Pettigrew, 1990). It is also an unnecessary one when there are affordable ways of quickly changing behaviours as and when required with whatever people, cultures, systems and structures one has (Coulson-Thomas, 2012e & 2013e).

QUESTIONING CULTURE CHANGE

Calls for culture change have become so widespread that some boards may find these siren voices difficult to resist. Various problems have been ascribed to ‘culture’ from mis-selling and risky lending to a near collapse of the international financial system (Behrendt & Moxey, 2008). Take mis-selling, Richard Lloyd (2013) of Which has pointed out that the £18.4 billion which it is estimated that UK banks have had to put aside to cover compensation claims relating to the mis-selling of payment protection insurance is almost twice the cost of the 2012 Olympic Games.

Does one actually need to change a culture to prevent mis-selling, assuming that there were a practical and achievable way of doing this? A much more affordable alternative would be to make it very difficult for people in front-line roles to mis-sell. This could be quickly achieved by performance support with appropriate pointers and blockers across a global organisation encompassing a diversity of cultures (Coulson-Thomas, 2007c). Boards can and should champion speed, flexibility and affordability.

Board members should challenge generalisations and automatic assumptions. If a change of culture is mentioned, obvious questions are: Change of culture to what? How might this be achieved and are there other ways of encouraging compliance and supporting desired behaviours? Companies today have to establish relationships with customers and other stakeholders from a wide range of cultures, while a culture that may suit one department or activity might be inappropriate for another.

Why would anyone spend a second trying to change a person’s ‘culture’ as opposed to adopting practical ways of helping people – with whatever cultures and other attributes they might have – to change behaviours? Pioneers of performance support that make it very easy for people to emulate high achieving peers and do difficult jobs find that people quickly adopt better and desired ways of doing things that offer clear benefits to themselves and their employers. In both the private and the public sectors there are cost-effective ways of enabling and evidencing compliance independently of a corporate culture (Coulson-Thomas, 2012f & 2013e).

ENTREPRENEURSHIP AND THE BOARDROOM

Why is it that so many directors ‘go with the flow’? Why are they adopting costly, time-consuming and inflexible approaches when less expensive, quicker and adaptable options are available? Is it because directors seek security in large numbers and find the ‘soft option’ is to do what other large companies are doing, and where they have concerns become a ‘team player’ and ‘not rock the boat’? How can we re-energise corporate boards and what part if any could ‘governance’ play in this?

One senses that just because some organisations are large their boards may feel that solutions to corporate problems need to be complex and expensive, and that simpler solutions would be inappropriate. Simple, elegant and effective courses of action are often overlooked. How could boards be made more entrepreneurial?

Large company mindsets can be particularly inappropriate in the context of a smaller business. How many contemporary and ambitious young entrepreneurs identify governance as a critical success factor for the growth and development of their businesses? What have boards contributed to most of today’s star internet-based businesses and high growth companies?

Those who have been directors of large corporations sometimes find it difficult to relate to entrepreneurs or add value on the board of a public body. An investigation based survey for an ACCA discussion paper found that the contribution which directors and boards – and particularly NEDs – could make to the growth and development of a smaller business is not always appreciated or sought by owner directors (Coulson-Thomas, 2007b). How applicable are contemporary approaches to governance to SMEs and public sector contexts?

An undesirable consequence of contemporary approaches to governance and the prevailing conduct of many boards is how they endeavour to avoid risks. Prior to our contemporary concern with ‘governance’ one used to encounter boards that were positive and focused upon building companies and making things happen? Negative attitudes seem to prevail in many board rooms today. One finds caution where there is a requirement for courage. The emphasis is upon avoiding risks and ‘compliance’ rather than developing new income streams and business building.

Sometimes risk and return are related. An excess of caution and negativity can lead to lower returns and missed opportunities. A board should inspire innovation and creativity rather than act like a wet blanket and smother initiative. As mentioned above, there are practical and cost-effective steps that a board can take to ensure compliance while allowing people the freedom to explore new possibilities, and enable responsible decision making by those with the potential to do great good and significant harm (Coulson-Thomas, 2007, 2012e & f & 2013e).

CHANGING ATTENTION AND FOCUS

One could undertake an attention-based analysis of boards just as William Ocasio (1997) suggested an attention-based view of the firm. Are directors looking in the right places? Is governance a distraction? There are a number of areas in which a different balance needs to be struck in corporate boardrooms (Coulson-Thomas, 2012b & e, & 2013c-e). Hitherto, ‘governance’ has not resulted in the shift of attention, focus and emphasis that is required.

Before the term ‘governance’ achieved the currency it has today the author recalls writing books such as ‘creating excellence in the boardroom’ and ‘creating the global company’ that emphasised the vital role that boards can play in providing strategic direction, business development and building shareholder value (Coulson-Thomas, 1992 & 1993). Getting the right board was often the key to successful and sustained growth. NEDs were helping executive directors, not checking up on them like private investigators. They looked outwards for opportunities rather than inwards for abuses.

A desire to focus on ‘the big picture’ and retain a ‘helicopter view’ can enable a board to retain a sense of perspective. It can also lead to over-generalisation and a mind set that instinctively endeavours to establish some form of code, policy or guidance rather than ensure a management team is taking specific steps to address important issues. The outputs of far too many boards consist of words rather than a stimulus to action. Blather can often be countered by further words that may not result in deeds.

There is little point mouthing motherhood statements, issuing bland pronouncements or producing business plans that are not implemented. In an attempt to be ‘strategic’ board pronouncements are sometimes too general to stick or have an impact. For example, vision and value statements are often instantly forgettable when they could be crafted to be helpful and enable those faced with a decision to determine the course of action most in line with an organisation’s strategic direction.

FOCUSING UPON WHAT IS IMPORTANT

Many boards need to focus more upon the implementation of their policies and strategies. In particular, they should assess their own effectiveness in the area of strategy implementation (Brauer and Schmidt, 2008). They may also need to better engage with various groups of stakeholders if they are to build longer-term and mutually beneficial relationships with them (Coulson-Thomas, 2012d).

Traditionally many boards have been criticised for taking a short-term view rather than thinking longer-term. However, in competitive markets and at times of uncertainty and insecurity, and when windows of opportunity can quickly open and close, some focus on immediate and pressing issues might also be required. There may not be a longer-term if certain issues and customer concerns are not addressed. One can adopt affordable ways of staying current (Coulson-Thomas, 2012e & 2013e).

Some clever and senior directors appear instinctively attracted to generalisations, frameworks and concepts where entrepreneurs would look for practical and affordable ways of building their businesses. Many of them also have a penchant for launching ‘big projects’ which they hope will deliver some benefits in future years rather than discuss available options that could impact more quickly upon current issues.

One sees an instinctive preference for interesting ideas, concepts and generalisation in the areas of research interest registered by business school and other academics on a website such as www.academia.edu. Hundreds or thousands of follow ‘interesting’ topics, some of which seem remote from the practical concerns of businesses and their customers. Far fewer focus on important areas such as pricing or purchasing, while only a handful may register to follow a topic such as “economic recession” which in recent years has been of concern to millions of people in certain countries.

ASSESSING THE IMPACTS OF GOVERNANCE

Is governance just an ‘interesting’ area for debate? Have discussions of governance and sustainability contributed to a preoccupation with the general, fine words and codes of practice? Have they led to the right focus for building businesses, or resulted in people barking up the wrong trees? Are the documents that have been produced enough to address contemporary or residual concerns? Should boards be doing more to capitalise upon opportunities and influence behaviours? What are the next steps?

Has governance been oversold? Has the attention devoted to it created unrealistic expectations? Why should a particular governance structure have any impact on the behaviour of key work-groups and corporate performance? The author’s investigations have long suggested that it is the conduct of directors, how effective they are and whether or not they make the right calls when difficult decisions have to be taken, that determines their contribution (Coulson-Thomas, 1993 & 2007a).

An association between board observance of corporate governance codes and financial performance is not necessarily conclusive evidence of a cause and effect relationship between the two. It is more likely that success is the consequence of a leadership team endeavouring to ‘do the right thing’, and – particularly in the case of business growth – ensuring that a company produces offerings that customers wish to buy, prices them competitively, achieves high performance and operates profitably.

In relation to governance, a board endeavouring to ‘get things right’ might wish to observe widely advocated governance codes. It might also seek to ensure that those for whom it is responsible operate in a sustainable way and how performance is measured and reported will reflect sustainability issues and impacts. International Integrated Reporting can be helpful in this regard if appropriately implemented.

‘NEW LEADERSHIP’

The attention of board members upon what is important cannot be assumed (Tuggle et al 2010). ‘New leadership’ puts more emphasis upon the monitoring and achievement of results. It is less focussed upon planning and top-down approaches and more concerned with implementation and providing better support to key work-groups that deliver priority corporate objectives (Coulson-Thomas, 2012d & 2013c-e).

The 2013 annual survey of CEOs undertaken by The Conference Board reveals that human capital is now the number one challenge globally and in Asia and Europe (Mitchell et al, 2013). Does HR need to become more influential within the boardroom? What role should HR directors and senior HR professionals play in the leadership required at the top of organisations today?

The ‘new leadership’ needed to fully exploit the findings of a five-year investigation undertaken by the author recognises the importance of providing people with better support in order to implement policies and strategy and deliver corporate objectives. It shifts the emphasis from motivating and managing people to helping them and making much more effective use of corporate know-how, and particularly of how best to do important activities, jobs and tasks (Coulson-Thomas, 2012e & 2013b-e).

Corporate boards can have an important role to play – individually, collectively and in influencing Government – in ensuring that businesses behave in a responsible way and that their regulation is effective and proportionate – generating beneficial results without the imposition of excessive burdens (Coulson-Thomas, 2013a). In relation to both board operation and Government intervention, care needs to be taken to ensure that cosmetic responses, box ticking and gaming do not occur (Hood, 2009).

Inappropriate or inadequate action might lead to a questioning of the role that capitalism can and should play in addressing fundamental challenges facing mankind. We need to consider capitalism’s own sustainability and the qualities and actions that might contribute to this. Business entrepreneurs should view sustainability and environmental challenges as opportunities. Innovations that their creative spirits in free and competitive markets may produce might well be our best hope for the future.

There is much that business leaders can learn from each other at an event like the London Global Convention, whether from formal panel discussion sessions, informal networking, or from corporate governance and sustainability case studies delivered by winners of Golden Peacock Awards. Convention attendees are likely to have shared interests and to be potential collaborators rather than competitors, with a common interest in an affordable route to a profitable and sustainable future.

Further Information

Details of the London Global Convention can be found on www.iodonline.com

Author*

Prof. Colin Coulson-Thomas, author of Transforming Knowledge Management, Transforming Public Services, Talent Management 2, Winning Companies; Winning People and Developing Directors, and an experienced corporate director, audit chair and board chairman, has been the vision holder of successful transformation programmes and has held public sector board appointments at national and local level. He has helped over 100 boards to improve board and corporate performance and leads the OLJ International Governance Initiative. His academic roles are at the University of Greenwich and as an adjunct visiting professor at Manipal University. He can be contacted by email: colin@coulson-thomas.com and via www.coulson-thomas.com

References

Alucha, M. (2009), Does Good Corporate Governance Matter? Best Practice in Poland, Management Research News, Vol. 32 No. 2, pp 185-198

Behrendt, Adrian and Moxey, Paul (2008), Climbing Out of the Credit Crunch, London, ACCA, December

Bordean, Ovidia, Borza, Anca and Maier, Veronica (2011), The Involvement of Boards in Strategy Implementation, Review of Comparative Management, Vol. 12 Issue 5, December, pp 986-992

Brauer, M. and Schmidt, S. L. (2008), Defining the strategic role of boards and measuring boards effectiveness in strategy implementation, Corporate Governance, 8 (5), pp 649-660

Coulson-Thomas, Colin (1992) Creating the Global Company, successful internationalization, McGraw-Hill, London

Coulson-Thomas, Colin (1993), Creating Excellence in the Boardroom, A guide to shaping directorial competence and board effectiveness, London, McGraw-Hill

Coulson-Thomas, Colin (2007a), Developing Directors, A handbook for building an effective boardroom team, Peterborough, Policy Publications

Coulson-Thomas, Colin (2007b), The Contribution of Directors and Boards to the Growth and Development of SMEs, ACCA Working Paper, London, ACCA, October

Coulson-Thomas, Colin (2007c), Winning Companies; Winning People, Making it easy for average performers to adopt winning behaviours, Peterborough, Policy Publications

Coulson-Thomas, Colin (2012a), 23rd World Congress: Leadership & Quality of Governance, Theme Paper, www.iodonline.com/images/23wctq/theme.pdf, 13th December

Coulson-Thomas, Colin (2012b), Building and Leveraging a High Performance Board: The Importance of Balance in the Boardroom, http://www.gseresearch.com/content/paper/10-5848-iod-2012-00004, January

Coulson-Thomas, Colin (2012c), Building and Managing High Performance Boards, Effective Executive, Vol. XV No. 1, March, pp 44-51

Coulson-Thomas, Colin (2012d), Engagement, ‘New Leadership’ and High Performance Organisations, Effective Executive, Vol. XV No. 4, December pp 45-52

Coulson-Thomas, Colin (2012e), Talent Management 2, A quicker and more cost effective route to the high performance organization, Peterborough, Policy Publications

Coulson-Thomas, Colin (2012f), Transforming Public Services, A quicker and affordable route to high performance public organisations, Peterborough, Policy Publications

Coulson-Thomas, Colin (2013a), Addressing Environmental Challenges and Opportunities, in Lt Gen J S Ahluwalia (Editor), Driving Green Economy for Sustainable Development and Inclusive Growth, New Delhi, IOD Publishing, July, pp 96-103

Coulson-Thomas, Colin (2013b), Implementing strategies and policies, Strategic Direction, Vol. 29 Issue: 3, pp.33 – 35

Coulson-Thomas, Colin (2013c), “New Leadership” and creating the high performance organisation: part 1, Industrial and Commercial Training, Vol. 45 No. 1, pp 23-31

Coulson-Thomas, Colin (2013d) “New leadership” and creating the high performance organisation: part 2, Industrial and Commercial Training, Vol. 45 Iss: 2, pp.92 – 98

Coulson-Thomas, Colin (2013e), Transforming Knowledge Management, A quicker and affordable route to high performance organisations, Peterborough, Policy Publications

Hood, Christopher (2009), The Numbers Game, Ethos Journal, August (http://www.ethosjournal.com/topics/public-service-delivery/item/49-the-numbers-game)

Janis, Irving (1972), Victims of Groupthink, Boston, MA, Houghton-Mifflin

Lloyd, Richard (2013), quoted in Daily Mail, 2nd August (http://www.dailymail.co.uk/news/article-2383074/PPI-mis-selling-costs-soar-18-4billion–DOUBLE-price-Olympic-Games.html)

Mitchell, Charles; Ray, Rebecca and van Ark, Bart (2013), CEO Challenge 2013, Summary Report, New York, The Conference Board

Ocasio, William (1997), Towards an attention-based view of the firm, Strategic Management Journal, 18, pp 187-206

Pettigrew, Andrew (1990), ‘Is corporate culture manageable?’ in Wilson, D and Rosenfield, R (editors). Managing Organisations, London, McGraw Hill

Tuggle, C. S., Sirmon, D. G., Reutzel, C. R. and Bierman, L. (2010), Commanding board of directors attention: investigating how organisational performance and CEO duality affect board members attention to monitoring, Strategic Management Journal, 31 (9), pp 946-968

 

14 Aug 2013
Colin Coulson-Thomas

New Report Shows how to Boost Benefits from Learning and Knowledge Management

According to a new report by Adaptation chairman Professor Colin Coulson-Thomas organisations are capturing and sharing the wrong sort of knowledge. Based upon a five-year investigation, the report Transforming Knowledge Management sets out a more affordable route to high performance organisations.

“Knowledge management initiatives have been excessively general and overly complex, and they have not delivered hoped for results,” claims Coulson-Thomas. He continues “A more focused and flexible approach is required that can quickly impact upon performance, achieve multiple objectives and provide clear benefits to both people and organisations.”

According to Coulson-Thomas, “Many organisations just load material onto a corporate intranet. What is captured and shared is often ‘commodity knowledge’ that is available to others. It does not differentiate or represent a source of competitive advantage.”

Coulson-Thomas argues we need to distinguish between ‘knowledge about things’ and ‘knowledge of how best to do things’. He explains: “There are people who know a great deal about the theory of accounting who I would not ask to prepare a set of accounts.”

The new 223 page evidence-based and A4 sized report questions ‘traditional’ approaches to knowledge management and sets out a more affordable route to greater returns on investment and achieving multiple objectives.

The report contains mini-case studies that illustrate a successful response to a generic challenge facing organisations. Each mini-case study briefly presents the problem addressed, what was done, the results achieved and subsequent situation, what made difference and main learning points.

Coulson-Thomas captures and shares what high achievers do differently. He believes “We need to step up from information management to knowledge-based performance support that helps key work groups to excel. Personalised help relevant to a particular job, issue or situation should be accessible 24/7 wherever people are, including when on the move.”

He continues: “Knowledge management needs to re-focus upon helping key work groups to adopt the superior approaches of high performers. Re-focused it can enable us to create high performance organisations and teams that remain current, competitive and vital.”

Many corporate initiatives promise jam tomorrow rather than measurable impact today. Coulson-Thomas believes “We need to shift the emphasis from ‘knowing’ to ‘doing’. Performance support can have a quick and direct impact on performance by focusing on knowledge of how to do things and – in particular – how to excel at difficult jobs.”

The new report shows how the benefits of knowledge-based performance support can include higher productivity, bespoke responses, reduced stress and evidenced compliance. The Professor concludes “It may be possible to simultaneously improve quality, cut costs and save time. Crucially we can do all this with existing people, cultures and structures.”

‘Transforming Knowledge Management’ (ISBN: 978-1-872980-24-9), published by Policy Publications in association with Adaptation, is available from: http://www.policypublications.com

Prof. Colin Coulson-Thomas, vision holder of successful transformation programmes and chairman of award winning companies, was the world’s first professor of corporate transformation. He has helped over 100 boards and management teams in over 40 countries to improve performance. He is also the author of Talent Management 2 and Transforming Public Services based upon the same investigation and Winning Companies; Winning People on helping average people to excel at difficult jobs and Developing Directors on building an effective boardroom team. He can be contacted via www.coulson-thomas.com

 

22 Jul 2013
Colin Coulson-Thomas

Addressing Environmental Challenges: Theme Paper for World Congress

15th World Congress on Environment Management

Theme Paper

ADDRESSING ENVIRONMENTAL CHALLENGES AND OPPORTUNITIES

Prof. Colin Coulson-Thomas

Directors and boards have to weigh a variety of contending factors when formulating visions and values and discussing and deciding corporate goals, objective and policies, including those relating to environmental challenges and opportunities. Choices have to made and there may be difficult trade-offs to consider at times of competitive pressure, uncertainty and insecurity.

Boards do not exist in a vacuum. There are required to obey the law. In coming to decisions board members are expected to put the interests of the company before their own and in some jurisdictions company law requires that they take the interests of various stakeholders into account.

The allegiance of stakeholders cannot be taken for granted. If relationships with them are to last they must be mutually beneficial. Particular attention needs to be paid to the evolving interests of customers. In competitive markets there will also be the aspirations, strategies and activities of competitors to be taken into account.

Effective direction is all about achieving an appropriate and sustainable balance between contending interests. Sometimes this requires that one does enough to benefit particular stakeholders, but not at the cost of then having insufficient resources to address the interests of other groups.

While directors and policy makers should put the interests of others before their own when taking decisions, many of them may be personally affected by environmental problems. In the UK, for example, the City of London and Westminster are among the areas worst affected by life-shortening particulates from diesel engines (Leake, 2013).

CRITICAL QUESTIONS FOR POLICY MAKERS AND BOARDS

Deciding between short, medium and long-term interests and inter-generational issues are particularly problematic. How does one weigh and take account of the interests of future generations who cannot today ‘vote with their feet’ and take their business, talent, allegiance or investment elsewhere?

Political decision makers in democracies sometimes postpone decisions such as replacing costly infrastructures, reducing harmful emissions or repaying debt in order to reduce their impacts on current voters. This postponement increases the scale of adjustment that will need to be made by future generations and the financial burdens that this will impose upon them.

In relation to energy policy, delays in formulating a strategy and commissioning new power stations can also significantly increase the costs upon businesses. ‘Green energy’ can be expensive. The wrong decisions can put a country’s industries at a competitive disadvantage in world markets.

UK Cabinet Office minister Francis Maude (2013) has called for civil servants to be less risk averse and more willing to question and challenge, including having more robust debates in private with ministers on policy issues. Going with the flow and obsequiousness can prevent suggested policies from being thought through.

Will corporate decision makers display greater leadership? Journalists and activists may call for action now to address current, imminent and future challenges but this can pose dilemmas for directors and boards in competitive markets. If ‘doing the right thing’ involves higher costs compared with those of competitors from countries where there is less pressure to change will customers stay loyal and pay the extra amounts?

Will talented people accept pay differentials in order to fund higher costs for more energy from renewal sources? Will investors hold shares providing a lower rate of return from a company that has higher operating costs as a result of its ‘enlightened’ policy towards sustainability and the environment?

THE IMPORTANCE OF TIMING

Commentators and activists can easily say that challenges should be viewed as opportunities, but innovation, changing operating, procurement and sourcing policies, and introducing new offerings, practices and technologies can involve up-front investment, risk and uncertainty. Acting more responsibly and sustainably is neither cost nor risk free.

Timing can be critical. A proportion of new approaches and environmental initiatives will fail. Some innovations may result in cost penalties and unintended and harmful consequences. Early adopters may encounter teething problems that harm relationships with key customers.

The pace of technological change in many areas is relentless. Move too soon and one may become locked into a technology that turns out to be more costly than those adopted by later entrants at a time when further development has occurred. Ultimately stakeholders will only benefit if attempts by companies to turn environmental and other challenges into opportunities are themselves affordable and sustainable.

This brings us back to the role and work of the company director and questions of how best to handle these and other issues at an individual company and collaborative level, and nationally and internationally. In each of these arenas a board can have a view of what is in the best interests of a company and its stakeholders.

Ignoring what is happening in the marketplace and in the national and international context can be risky and irresponsible. A board should be alert to external proposals that might impact upon its operations and activities – including perhaps putting it at a competitive disadvantage – and seek to influence any action that is taken.

FOCUSING ON THE DISCRETE AND MANAGEABLE

A combination of challenges may seem so intimidating that corporate boards and public decision makers appear incapacitated by their magnitude, rather like a rabbit frozen in the glare of the headlights of an approaching car. Sometimes breaking what may at first sight seem insurmountable into a series of specific issues can make it easier to resolve them. A particular problem can invite a discrete solution, while general appeals for moderation and restraint go unheeded.

It was as recently as 1985 when an article in Nature by Joe Farman and his British Antarctic Survey colleagues first alerted many people to the emergence of a hole in the ozone layer (Farman, et al, 1985). Caused by man-made chlorofluorocarbons (CFCs) released from products found in many homes, the depletion of this protective barrier threatened to increase the risk of skin cancer and other damage caused by ultraviolet rays. A particular problem had an identifiable cause.

Following a period of denial and early industrial opposition collective action was forthcoming. Less than two and half years after the Nature article, 24 countries signed the Montreal protocol to phase out CFCs and other chemicals that posed a danger to the ozone layer. The agreement has subsequently been ratified by all UN member countries and the hope is that the ozone shield will be re-established.

Rather than fret about what is insuperable and what they cannot influence, corporate, public and voluntary body, and political decision makers, should focus upon what they can achieve individually and collectively. In order to make progress this may require breaking general problems down into discrete and manageable elements.

Lord Butler (1971) entitled his political memoirs “The Art of the Possible” and the term could be applied to what is needed to address environmental challenges and opportunities. Concrete action in particular areas can demonstrate progress, build confidence and help to establish an appetite for further initiatives.

DETERMINING CORPORATE STRATEGIES

It is for a board to determine what is possible and desirable for an individual company when formulating corporate and sustainability strategy. To do this its members will first need to identify and understand relevant and significant trends and developments in the external business, market, economic, social, technological and political environment. These should be prioritised in terms of their significance and likelihood of their impacts, which should then be considered along with corporate responses.

Impacts could be short or longer-term, mild or intense, at a local level or more widespread and mitigating action to confront challenges or steps to capitalise upon opportunities could vary from local to corporate and may or may not require wider collaboration. Examples of impacts could range from resource constraints and shortages as a result of unsustainable activities to the results of climate change.

There will be steps that individual managers and business units could take and other responses that would benefit from working with customers, suppliers, business partners or other organisations with compatible interests. Some responses could be operational such as a drive for efficiency and the more effective use of resources. Others could be more strategic, such as identifying specific business opportunities.

In some cases Government action might be sought. While a company could seek to reduce harmful emissions and comply with environmental standards, new laws and regulations – and more consistent and active enforcement – might help to create a level playing field vis-à-vis competitors. Enabling action could include steps to reduce obstacles and barriers to change, while the case for incentives could also be put.

The companies that are most successful at identifying business opportunities are those whose directors and staff do not just look at the impacts of external developments upon themselves. They also consider likely impacts upon their customers, and what they can do to help their customers to cope with environmental challenges and/or exploit any opportunities that might arise (Coulson-Thomas, 2007).

GOVERNMENT ACTION

In discussion of political action and inaction the roles and responsibilities of senior civil servants who advise and support them is sometimes overlooked. Public sector leadership can present particular challenges and, as with corporate leadership, Sir Leigh Lewis a former Permanent Secretary has identified courage as one of the qualities that is required (Lewis, 2013). One sometimes needs the courage to make a start and take the individual steps necessary for a demanding journey.

Government largesse and action can impact upon sustainability in a number of ways. One’s first through often turns to legislation and regulation, and measures in these areas should encourage and enable innovation and environmentally desirable activities as well as seeking to prevent harmful ones. Financial initiatives can similarly include incentives as well as penalties.

Enacting measures is one thing, enforcing them is another and this does not always happen due to a variety of factors, including on occasion favouritism. In some countries bribes are paid to avoid penalties and obtain favours. Such practices can be a barrier to innovation and growth. Where honesty and integrity is the norm wrongdoers may avoid sanction because a relevant Government department or agency lacks the resources to identify and pursue them. There has been the suggestion that this may have happened in respect of insolvency proceedings (Wild, 2013).

People sometimes underestimate the impact a Government can have as a customer. Public procurement can encourage more sustainable activities and practices by opting to buy from suppliers that are more economical in their use of resources. This may involve turning away from large incumbent suppliers to favour new entrants and more innovative businesses. There may be barriers to entry and participation in bidding for public contracts that could be reduced by conscious effort.

RISKS OF PUBLIC INTERVENTION

Care needs to be taken to ensure that Government action does not lead to distortion, unfair competition, whether nationally or internationally, or new barriers to entry. Inviting public action can sometimes feel like bringing an elephant into a china shop. Like a large beast public decision making can be slow and progress lumbering.

General laws and regulations can impose unwelcome burdens and may have an unequal impact upon different business sectors. Sometimes when forced to choose between competing interests and adopt a single approach a Government can be less flexible than markets. The operations of the latter can lead to multiple responses each addressing particular interests. Business reactions can often be simultaneously more entrepreneurial, innovative and tailored.

One needs to think carefully about the arenas and forms in which public and/or private action is appropriate and how responsibilities should be allocated between individuals and organisations. Where public action and intervention is thought appropriate, one needs to consider whether this would be best done at local, regional, state or central Government level, or by an agency, either locally, nationally, regionally or internationally.

DEVELOPING MUTUALLY BENEFICIAL RELATIONSHIPS

Directors of companies individually – and collectively through representative bodies – – can help Government bodies to achieve environmental and sustainability objectives by providing advice on implementation and looking out for barriers and distortions created by public measures. Just as established players act to protect their interests, ambitious business leaders can put the case for policy changes and new measures that would stimulate innovation and competitiveness.

Individually and collectively they could also call for a level playing field to ensure they are not put at a competitive disadvantage vis-à-vis international competitors by the actions of a national Government. If successful, they may find that international responses are at the speed of the countries that are most reluctant to act.

While public servants might be wary of those they perceive as lobbying in their own interests, they may welcome collaboration that is for the public good. Providers of public services should seek to work with those at whom these services are aimed and take steps to help them to make business, consumption and/or lifestyle decisions that are more responsible, beneficial and sustainable (Coulson-Thomas, 2012b).

MAKING IT HAPPEN

Once a strategy and a way forward have been agreed, outside of the boardroom little may happen until it is communicated and shared. People need to be engaged. They need to be told why change is needed and what they can do to help to bring it about. For good reason Sir John Harvey-Jones (1988) entitled his book on his experiences as a company chairman “Making it Happen”. Too many strategies are dead and historic documents rather than living motivators and guides.

Corporate leaders need to be effective communicators to reach, engage and motivate people. Ways need to be found of reaching people in a language that they can understand. Intellectual arguments such as those displayed at business school when tackling a case are not enough. A cause may need a voice. An effective and evocative argument that resonates, such as that presented by Rachel Carson (1962) in her classic book “Silent Spring”, may be required to secure attention and motivate action.

Companies can also help their customers to take more responsible decisions when acquiring and using their offerings by making them more aware of available options and their consequences (Coulson-Thomas, 2009, 2012a & 2013e). As a result of this greater understanding they may be able to make more beneficial and less damaging choices from the perspective of the environment and sustainability.

The ‘new leadership’ that is required in corporate boardrooms with its focus upon implementation and providing ‘bottom-up’ support is conducive of more engagement, greater understanding and more effective action (Coulson-Thomas, 2013a-e).

THE VALUE OF DISCUSSION

The 15th World Congress on Environment Management is an opportunity for directors to compare their own strategies and approaches for addressing environmental challenges and opportunities with those of their peers. They can discuss how boards might best handle the problems involved. They may discover governance arrangements that others have employed to achieve a better understanding of the inter-linkages between issues and how best to resolve them.

An issue for many boards is determining a course of action today that does not prevent other – and perhaps more lucrative options – in the future. Learning from the experiences of others and best practice case studies can lead to new insights into ways of conserving natural resources, using these effectively and achieving sustainable and profitable growth.

REFERENCES

Butler, R A (1971), The Art of the Possible, London, Hamish Hamilton

Carson, R (1962), Silent Spring, Boston, Mass., Houghton Mifflin

Coulson-Thomas, C (2007), Winning Companies; Winning People, Making it easy for average performers to adopt winning behaviours, Peterborough, Policy Publications

Coulson-Thomas, C (2009), Enabling informed environmental choices: helping customers assess purchasing impacts in Ahluwalia, J (Editor), Governance for Climate Security: Business, Innovation, Social Change and National Security, New Delhi, World Environment Foundation/MM Publishing, pp 318-325

Coulson-Thomas, C (2012a), Talent Management 2: A quicker and more cost effective route to the high performance organisation, Peterborough, Policy Publications

Coulson-Thomas, C (2012b), Transforming Public Services: A quicker and more affordable route to high performance public organisations, Peterborough, Policy Publications

Coulson-Thomas, C (2013a), Implementing strategies and policies, Strategic Direction, Vol. 29 Issue: 3, pp.33 – 35

Coulson-Thomas, C (2013b), “New Leadership” and creating the high performance organisation: part 1, Industrial and Commercial Training, Vol. 45 No. 1, pp 23-31

Coulson-Thomas, C (2013c), “New leadership” and creating the high performance organisation: part 2, Industrial and Commercial Training, Vol. 45 Issue: 2, pp.92 – 98

Coulson-Thomas, C (2013d), Talent Management 2 for Today’s Leaders, Business Leadership Review, 10: 2, Spring, pp 16-21

Coulson-Thomas, C (2013e), Transforming Knowledge Management, a quicker and affordable route to high performance organisations, Peterborough, Policy Publications

Farman, J C, Gardiner, B G and Shanklin, J D (1985), Large losses of total ozone in Antarctica reveal seasonal CIOx/NOx interaction, Nature, 315, 16th May, pp 207-210

Harvey-Jones, Sir J (1988), Making it Happen, London, Collins

Leake, Jonathan (2013), Richest areas suffer most pollution deaths, Sunday Times, 20th January and on-line version: Des res boroughs suffer worst pollution deaths: http://www.thesundaytimes.co.uk/sto/news/uk_news/Environment/article1197791.ece

Lewis, Sir Leigh (2013), Future Challenges for Public Service Leaders, Keynote address to New Approaches to Leadership in the Public Services: Insights from research and practice, Centre for Innovation, Imagination & Intuition, 23rd May

Maude, Francis (2013), Ministers and Mandarins: Speaking Truth unto Power, London, Policy Exchange, June

Wild, Jane (2013), Insolvency Service too poor to chase wrongdoers, Financial Times, 6th February, p 4

AUTHOR SHORT BIOGRAPHY

Prof Colin Coulson-Thomas, international adviser, experienced chairman of award winning companies and a Change Agent and Transformation Leader award winner is author of ‘Transforming Knowledge Management’ and over 40 other books and reports. He has helped over 100 boards to improve director, board and corporate performance and spoken at over 200 national and international events in over 40 countries. He is a member of the business school team at the University of Greenwich and an adjunct visiting professor at Manipal University. His reports are available from www.policypublications.com and he can be contacted via www.coulson-thomas.com.

 

10 Jul 2013
Colin Coulson-Thomas

New Critique of Knowledge Management Given in Keynote at Global Convention

Transforming Knowledge Management

Speech to Dubai Global Convention on Business Excellence
Burj Al Arab, Dubai, May 1st 2013

Prof. Colin Coulson-Thomas* – Keynote 2

How can we transform knowledge management to increase its impact on business performance?

Knowledge is increasing at an exponential rate. Some of it is trivial and mundane. Some of it is innovative and profound. Some of it is useful. Some of it is potentially harmful.

Much of the knowledge that is available can be accessed in seconds via a search engine. Should we be delighted or concerned?

How much of what is found is relevant to current challenges and opportunities? Does it increase our understanding?

People with issues used to discuss them and select what was felt to be the best course of action for resolving them. Now people stare into screens and go-online.

This may or may not be helpful depending upon what is found and its relevance and value. Are people just browsing and interacting rather than thinking and acting?

How could knowledge management contribute more to the delivery of key corporate objectives? What needs to change? Is a different approach required?

I explored these questions for a new report – Transforming Knowledge Management. It follows a five-year search for quicker, more affordable and less disruptive ways of creating high performance organisations.

I will briefly summarise some key findings of this and related reports.

Knowledge management needs to be transformed. The achievements of traditional approaches have fallen short of expectations. Many organisations have failed to derive anticipated benefits from knowledge management initiatives. Their focus, justification and returns on investment need to be addressed.

Is knowledge management just another fad put about by consultants to drum up new business? Its use has often been more limited than their rhetoric suggests.

Widespread references to knowledge management have given it a profile and standing that may not be justified in terms of the extent and value of its adoption.

Yet the sharing of useful and relevant knowledge can increase understanding and be a source of competitive advantage.

When relevant know-how is made available as and when and wherever required, it can increase performance and contribute to the delivery of multiple objectives. So what is going wrong and what needs to be done?

Many organisations just load information and knowledge onto a corporate intranet or other central repository. Assembly of knowledge sometimes takes priority over its utility and deployment.

More information per se does not necessarily increase understanding.

What is captured and shared is often ‘commodity knowledge’ that is available to others. It does not differentiate or represent a source of competitive advantage.

It is hard to stand out, innovate and become a market leader by copying everyone else.

Last week I addressed a corporate learning summit in Chicago. Corporate learning has much to answer for.

Investigations for my Developing a Corporate Learning Strategy report revealed that people are offered general programmes rather than the specific and personalised support they need to be effective in their jobs.

Training and development inputs are not giving rise to intellectual capital outputs. Many people draw from the wells of corporate knowledge. Far fewer add to them.

I also led the investigation for the Managing Intellectual Capital to Grow Shareholder Value report. We looked at 20 areas of intellectual capital and found that even the best companies were only effectively managing a few of them.

Categories of know-how managed are not always the ones offering the biggest potential for additional income.

Some companies could be many times their size if they fully exploited their corporate know-how.

Imagine what these companies could achieve if they also properly exploited what their best people knew.

We need to step up from information and knowledge management to knowledge entrepreneurship.

Thirty seven possible revenue generating services using readily available information are listed in my book The Knowledge Entrepreneur.

Many potentially useful categories of know-how are not fully exploited because they are thought to be in formats that cannot be easily managed. No company need have this problem.

There are knowledge frameworks that can handle a variety of formats from visual images and animations to audio and film recordings. They enable people to work with know-how and they can support applications on a range of mobile devices.

When people tell me how much they know, my immediate reaction is often “so what?”

Can you get hold of it when you need help? What does it enable you to do differently? How relevant is it? Is it up-to-date? Is it job-related?

Relevance is critical. People, work groups and organisations need access to knowledge that is relevant to what they are seeking to accomplish and relevant to particular challenges, decisions and opportunities they face.

We are drowning in information. Yet obtaining help as and when it is required is often a problem.

Ideally, people should be able to access personalised knowledge and support that is relevant to a particular job, case, issue or situation wherever they might be, including when on the move.

A crucial distinction is that between ‘knowledge about things’ and ‘knowledge of how best to do things’. There are people who know a great deal about the theory of accounting who I would not ask to prepare a set of accounts.

Many knowledge management teams focus on meeting the information support needs of people in central departments. ‘Walking overheads’ in corporate head offices use this information to justify their roles.

Reporting a problem is different from dealing with it. Action – whether winning more business or building better customer relationships – is often in the hands of certain key work groups in ‘front-line’ roles.

These are the people that knowledge management should be supporting.

What do high performers do differently in these important and often difficult jobs? It’s not a state secret. I’ve led investigations for over 20 reports that set out critical success factors for key corporate activities.

There is considerable upside potential. Superstars may be only very effective at less than half of the identified critical success factors. The performance of every organisation examined could be greatly improved.

Knowledge management needs to re-focus upon helping key work groups to excel by adopting the superior approaches of high performers.

This is the world of performance-focused knowledge support. This is where knowledge management can make a significant contribution to business excellence.

Re-focused and personalised it can help us to create high performance organisations that remain current, competitive and vital.

A related report Talent Management 2 also shows that multiple benefits for individuals, organisations and the environment can be quickly obtained by working with one’s existing people and without requiring a change of corporate culture or structure.

Even if culture change could be achieved, it might not be desirable. Why should an organisation with employees and customers from a variety of nationalities, religions and cultures want a common corporate culture? The creative culture of the advertising team may not be right for those preparing annual accounts.

The Transforming Public Services report shows advantages such as low barriers to entry and cost-effectiveness also apply to the public sector.

Performance support can enable people to cope with new requirements and changes of policy and priorities that occur at different stages of a transformation journey.

Talking of journeys – Many corporate initiatives promise jam tomorrow rather than a measurable contribution to key corporate objectives today.

Speed of impact can be vital. Competition is relentless. If today’s problems are not addressed, and new windows of opportunity are not quickly seized, a company may not have a tomorrow.

Business excellence – and other management approaches – sometimes lead to restructuring and the loss of knowledge.

They do not result in the provision of better support which can lead to a wide range of benefits, including greater flexibility, faster responses and lower operating costs.

A period of slack can be a good time to take stock and re-focus.

When the world economy is booming – and competitors are fully booked- almost any fool can make money.

During recessions and economic down-turns smart companies take steps to differentiate and secure competitive advantage.

Appropriate support can have a quick and direct impact on performance by focusing on knowledge of how to do things and – in particular – how to excel at difficult jobs.

It requires a shift of emphasis from ‘knowing’ to ‘doing’ and the provision of relevant help.

It can enable average operators to access and adopt relevant critical success factors and the superior approaches of high achievers as and when and wherever required.

The benefits of performance support also include higher productivity, bespoke responses, reduced stress and evidenced compliance.

It can also eliminate certain traditional trade offs. For example, it may be possible to simultaneously improve quality, cut costs and save time.

Adopters have also achieved returns on investment of over 20, 30 or 70 times within months rather than years.

Some users of business excellence models initiate too many projects. People end up confused and are pulled in different directions.

Performance-focused knowledge support works best when applied to key work groups – such as people who win bids or buy.

Boards need to break free from the embrace of C-suite executives and ensure that those in important front-line jobs are a priority and properly supported.

Boards should challenge initiatives rather than assume their desirability.

Knowledge management, talent management, change management and corporate learning can all be transformed.

Performance support can complement business excellence – in some cases rescuing it and in others increasing its impact.

For its benefits to be fully realised, director and board leadership may have to change.

‘New leadership’ shifts the emphasis from motivating and managing people to helping them.

It is less focused upon ‘command and control’, planning and top-down approaches and more concerned with implementation and ‘bottom-up’ support.

Rather than hope that something will turn up, ‘new leaders’ ensure key workgroups that deliver priority corporate objectives are better supported.

There is uncertainty and insecurity in many boardrooms. Personalised performance support can help people to cope. It can prepare vital workgroups for an unknown future.

Performance support can make things happen by helping people to do what is needed to succeed.

Smart boards ensure that people are equipped and enabled to do what is required in a winning way.

To compete and win one rarely needs to be excellent at everything. Many areas are neither visible to customers, nor sources of competitive advantage.

One should prioritise and focus. Success usually depends on certain critical success factors in particular areas and not the widespread adoption of general competences.

‘New leadership’ is characterised by focus. Assembling corporate knowledge can create a potential. Whether or not this is effectively used will depend upon the quality and relevance of the knowledge collected and how it is used and deployed.

In themselves management approaches, methodologies and tools also represent potential. They offer possibilities.

The extent to which they help us or harm us depends upon how we use them – what we apply them to and for what purpose.

Knowledge-based support could be applied to a fundamental problem or to a trivial issue.

It should be focused upon core activities and key jobs that deliver priority corporate objectives.

It can also be conducive of social networking across communities and within work groups. People should be encouraged to share insights, hints and tips – particularly about better ways of doing things.

Endeavouring to avoid all risks can lead to stagnation and missed opportunities. Building checks into performance support can allow business leaders to both liberate people and prevent unwanted actions. It can enable policy implementation and responsible innovation.

People can be set free to develop bespoke responses to individual customer requirements.

Support has to address the realities of busy people working in dynamic contexts. Automatic updating ensures they have the latest version and comply with changing policies, regulations and laws.

‘Top-down’ leadership may not deliver the advantages which a change of emphasis and focus could bring.

We need to transform knowledge management. We need ‘new leadership’. We need an alternative ‘bottom-up’ approach to creating high performance organisations.

With these in place we could simultaneously achieve progress on several fronts. Business excellence could become a reality.

*Prof Colin Coulson-Thomas, an experienced Process Vision Holder of successful transformation programmes, chairman of award winning companies and a Change Agent and Transformation Leader award winner is author of ‘Transforming Knowledge Management’, ‘The Knowledge Entrepreneur’ and over 40 other books and reports. He has helped over 100 boards to improve director, board and corporate performance and spoken at over 200 national and international events in over 40 countries. He was the world’s first professor of corporate transformation and now has a part-time role at the University of Greenwich. His latest reports including Transforming Knowledge Management are available from www.policypublications.com and he can be contacted via www.coulson-thomas.com.

 

10 Jul 2013
Colin Coulson-Thomas

Investigation reveals many costly corporate change programmes should be dropped

Professor’s findings suggest focused initiatives to provide direct support to customers and front-line staff can quickly deliver multiple objectives

General, costly and protracted improvement programmes in many companies need to be replaced by fewer but more focused and affordable initiatives that can simultaneously achieve multiple objectives according to Prof. Colin Coulson-Thomas speaking in Prague at a conference for those leading change, improvement and transformation programmes in the energy sector. “Less really can be more” argued the professor “fewer activities focused upon supporting key work groups in demanding front-line roles can result in large returns on investment within a few months.”

According to Coulson-Thomas “Policies and priorities can and do change while many expensive and costly programmes struggle to deliver tangible benefits. Life is too short to burn up precious time on corporate wide change initiatives that have a low probability of delivering. Customers usually have little or no interest in a supplier’s structure, systems, processes or culture. They usually just want to competent, quick, safe and effective response from the front-line staff they deal with.”

The professor believes “Too often corporate bureaucracies are getting in the way. There is little point trying to improve them or change the behaviour of middle managers when increasingly lower cost learning and performance support can help customers and the front-line staff who deal with them to increase their understanding and help themselves. Rather than try to change structures, systems, processes and cultures corporate leaders can simply by-pass them and reduce them.”

Coulson-Thomas has identified critical success factors for vital corporate activities. He believes the key to success is to help people undertake key tasks and important jobs as a top performer would: “Winning more business can be a matter of submitting winning bids rather than re-engineering a bid process and its supporting systems. You cannot re-engineer a process to submit a bid before it is prepared. Key tasks are getting an invitation to bid, preparing a winning response and negotiating a successful conclusion. Our Winning New Business and related reports set out how to do this.”

The professor gave examples of how success can be achieved and support delivered by simple and widely available technologies: “The mobile devices one’s people and customers have bought for themselves can often be a readily available means of providing 24/7 learning and performance support. Speed is important as windows of opportunity quickly open and close. The costly mega-projects advocated by so many external providers would be too late even if they delivered”.

The results of a five year investigation into more affordable routes to building high performance organisations undertaken by Prof. Coulson-Thomas are being set out in a series of reports. They suggest it is possible to simultaneously deliver multiple objectives and benefit people, organisations and the environment. Learning and performance support can enable average people to excel, ensure compliance, increase performance, cut costs, speed up responses and reduce risk and stress.

Dr Colin Coulson-Thomas, an international Change Agent and Transformation Leader Award winner, has the been Process Vision Holder of successful transformation programmes when energy markets have opened up in the UK and Austria and advised on the implementation of certain of the largest change programmes undertaken in the utilities. He was the world’s first Professor of Corporate Transformation and can be contacted via www.coulson-thomas.com.

Publications based upon investigations led by Prof. Coulson-Thomas to identify and develop more cost-effective approaches, including Winning New Business and other reports on how to win business, reports on talent, knowledge and key account management, pricing, purchasing, creating and exploiting know-how, and Winning Companies; Winning People which provides an overview of what high performers do differently in areas examined can be obtained from www.policypublications.com.

Prof. Coulson-Thomas was speaking on Simultaneously Achieving Multiple Objectives at a conference on Advanced Business Process Management and Operational Excellence for the Energy Market. The event was concerned with building sustainable and profitable operational capability and held at Le Palais Hotel, Prague in the Czech Republic.

 

25 May 2013
Colin Coulson-Thomas

Adaptation chairman calls for transformation of knowledge management at global convention

Transforming Knowledge Management

Speech to Dubai Global Convention on Business Excellence
Burj Al Arab, Dubai, May 1st 2013

Prof. Colin Coulson-Thomas* – Keynote 2
University of Greenwich

How can we transform knowledge management to increase its impact on business performance?

Knowledge is increasing at an exponential rate. Some of it is trivial and mundane. Some of it is innovative and profound. Some of it is useful. Some of it is potentially harmful.

Much of the knowledge that is available can be accessed in seconds via a search engine. Should we be delighted or concerned? How much of what is found is relevant to current challenges and opportunities? Does it increase our understanding?

People with issues used to discuss them and select what was felt to be the best course of action for resolving them. Now people stare into screens and go-online. This may or may not be helpful depending upon what is found and its relevance and value. Are people just browsing and interacting rather than thinking and acting?

How could knowledge management contribute more to the delivery of key corporate objectives? What needs to change? Is a different approach required?

I explored these questions for a new report – Transforming Knowledge Management. It follows a five-year search for quicker, more affordable and less disruptive ways of creating high performance organisations. I will briefly summarise some key findings of this and related reports.

Knowledge management needs to be transformed. The achievements of traditional approaches have fallen short of expectations. Many organisations have failed to derive anticipated benefits from knowledge management initiatives. Their focus, justification and returns on investment need to be addressed.

Is knowledge management just another fad put about by consultants to drum up new business? Its use has often been more limited than their rhetoric suggests. Widespread references to knowledge management have given it a profile and standing that may not be justified in terms of the extent and value of its adoption.

Yet the sharing of useful and relevant knowledge can increase understanding and be a source of competitive advantage. When relevant know-how is made available as and when and wherever required, it can increase performance and contribute to the delivery of multiple objectives. So what is going wrong and what needs to be done?

Many organisations just load information and knowledge onto a corporate intranet or other central repository. Assembly of knowledge sometimes takes priority over its utility and deployment. More information per se does not necessarily increase understanding.

What is captured and shared is often ‘commodity knowledge’ that is available to others. It does not differentiate or represent a source of competitive advantage. It is hard to stand out, innovate and become a market leader by copying everyone else.

Last week I addressed a corporate learning summit in Chicago. Corporate learning has much to answer for. Investigations for my Developing a Corporate Learning Strategy report revealed that people are offered general programmes rather than the specific and personalised support they need to be effective in their jobs.

Training and development inputs are not giving rise to intellectual capital outputs. Many people draw from the wells of corporate knowledge. Far fewer add to them.

I also led the investigation for the Managing Intellectual Capital to Grow Shareholder Value report. We looked at 20 areas of intellectual capital and found that even the best companies were only effectively managing a few of them. Categories of know-how managed are not always the ones offering the biggest potential for additional income.

Some companies could be many times their size if they fully exploited their corporate know-how. Imagine what these companies could achieve if they also properly exploited what their best people knew.

We need to step up from information and knowledge management to knowledge entrepreneurship. Thirty seven possible revenue generating services using readily available information are listed in my book The Knowledge Entrepreneur.

Many potentially useful categories of know-how are not fully exploited because they are thought to be in formats that cannot be easily managed. No company need have this problem. There are knowledge frameworks that can handle a variety of formats from visual images and animations to audio and film recordings. They enable people to work with know-how and they can support applications on a range of mobile devices.

When people tell me how much they know, my immediate reaction is often “so what?” Can you get hold of it when you need help? What does it enable you to do differently? How relevant is it? Is it up-to-date? Is it job-related?

Relevance is critical. People, work groups and organisations need access to knowledge that is relevant to what they are seeking to accomplish and relevant to particular challenges, decisions and opportunities they face.

We are drowning in information. Yet obtaining help as and when it is required is often a problem. Ideally, people should be able to access personalised knowledge and support that is relevant to a particular job, case, issue or situation wherever they might be, including when on the move.

A crucial distinction is that between ‘knowledge about things’ and ‘knowledge of how best to do things’. There are people who know a great deal about the theory of accounting who I would not ask to prepare a set of accounts.

Many knowledge management teams focus on meeting the information support needs of people in central departments. ‘Walking overheads’ in corporate head offices use this information to justify their roles.

Reporting a problem is different from dealing with it. Action – whether winning more business or building better customer relationships – is often in the hands of certain key work groups in ‘front-line’ roles. These are the people that knowledge management should be supporting.

What do high performers do differently in these important and often difficult jobs? It’s not a state secret. I’ve led investigations for over 20 reports that set out critical success factors for key corporate activities.

There is considerable upside potential. Superstars may be only very effective at less than half of the identified critical success factors. The performance of every organisation examined could be greatly improved.

Knowledge management needs to re-focus upon helping key work groups to excel by adopting the superior approaches of high performers. This is the world of performance-focused knowledge support. This is where knowledge management can make a significant contribution to business excellence. Re-focused and personalised it can help us to create high performance organisations that remain current, competitive and vital.

A related report Talent Management 2 also shows that multiple benefits for individuals, organisations and the environment can be quickly obtained by working with one’s existing people and without requiring a change of corporate culture or structure.

Even if culture change could be achieved, it might not be desirable. Why should an organisation with employees and customers from a variety of nationalities, religions and cultures want a common corporate culture? The creative culture of the advertising team may not be right for those preparing annual accounts.

The Transforming Public Services report shows advantages such as low barriers to entry and cost-effectiveness also apply to the public sector. Performance support can enable people to cope with new requirements and changes of policy and priorities that occur at different stages of a transformation journey.

Talking of journeys – Many corporate initiatives promise jam tomorrow rather than a measurable contribution to key corporate objectives today. Speed of impact can be vital. Competition is relentless. If today’s problems are not addressed, and new windows of opportunity are not quickly seized, a company may not have a tomorrow.

Business excellence and other management approaches sometimes lead to restructuring and the loss of knowledge. They do not result in the provision of better support which can lead to a wide range of benefits, including greater flexibility, faster responses and lower operating costs.

A period of slack can be a good time to take stock and re-focus. When the world economy is booming – and competitors are fully booked- almost any fool can make money. During recessions and economic down-turns smart companies take steps to differentiate and secure competitive advantage.

Appropriate support can have a quick and direct impact on performance by focusing on knowledge of how to do things and – in particular – how to excel at difficult jobs. It requires a shift of emphasis from ‘knowing’ to ‘doing’ and the provision of relevant help. It can enable average operators to access and adopt relevant critical success factors and the superior approaches of high achievers as and when and wherever required.

The benefits of performance support also include higher productivity, bespoke responses, reduced stress and evidenced compliance. It can also eliminate certain traditional trade offs. For example, it may be possible to simultaneously improve quality, cut costs and save time. Adopters have also achieved returns on investment of over 20, 30 or 70 times within months rather than years.

Some users of business excellence models initiate too many projects. People end up confused and are pulled in different directions. Performance-focused knowledge support works best when applied to key work groups – such as people who win bids or buy.

Boards need to break free from the embrace of C-suite executives and ensure that those in important front-line jobs are a priority and properly supported. Boards should challenge initiatives rather than assume their desirability.

Knowledge management, talent management, change management and corporate learning can all be transformed. Performance support can complement business excellence – in some cases rescuing it and in others increasing its impact. For its benefits to be fully realised, director and board leadership may have to change.

‘New leadership’ shifts the emphasis from motivating and managing people to helping them. It is less focused upon ‘command and control’, planning and top-down approaches and more concerned with implementation and ‘bottom-up’ support. Rather than hope that something will turn up, ‘new leaders’ ensure key workgroups that deliver priority corporate objectives are better supported.

There is uncertainty and insecurity in many boardrooms. Personalised performance support can help people to cope. It can prepare vital workgroups for an unknown future.

Performance support can make things happen by helping people to do what is needed to succeed. Smart boards ensure that people are equipped and enabled to do what is required in a winning way.

To compete and win one rarely needs to be excellent at everything. Many areas are neither visible to customers, nor sources of competitive advantage. One should prioritise and focus. Success usually depends on certain critical success factors in particular areas and not the widespread adoption of general competences.

‘New leadership’ is characterised by focus. Assembling corporate knowledge can create a potential. Whether or not this is effectively used will depend upon the quality and relevance of the knowledge collected and how it is used and deployed.

In themselves management approaches, methodologies and tools also represent potential. They offer possibilities. The extent to which they help us or harm us depends upon how we use them – what we apply them to and for what purpose.

Knowledge-based support could be applied to a fundamental problem or to a trivial issue. It should be focused upon core activities and key jobs that deliver priority corporate objectives.

Performance support can also be conducive of social networking across communities and within work groups. People should be encouraged to share insights, hints and tips – particularly about better ways of doing things.

Endeavouring to avoid all risks can lead to stagnation and missed opportunities. Building checks into performance support can allow business leaders to both liberate people and prevent unwanted actions. It can enable policy implementation and responsible innovation. People can be set free to develop bespoke responses to individual customer requirements.

Support has to address the realities of busy people working in dynamic contexts. Automatic updating ensures they have the latest version and comply with changing policies, regulations and laws.

‘Top-down’ leadership may not deliver the advantages which a change of emphasis and focus could bring. We need to transform knowledge management. We need ‘new leadership’. We need an alternative ‘bottom-up’ approach to creating high performance organisations. With these in place we could simultaneously achieve progress on several fronts. Business excellence could become a reality.

*Prof Colin Coulson-Thomas, an experienced Process Vision Holder of successful transformation programmes, chairman of award winning companies and a Change Agent and Transformation Leader award winner is author of ‘Transforming Knowledge Management’, ‘The Knowledge Entrepreneur’ and over 40 other books and reports. He has helped over 100 boards to improve director, board and corporate performance and spoken at over 200 national and international events in over 40 countries. He was the world’s first professor of corporate transformation and now has a part-time role at the University of Greenwich. His latest reports are available from www.policypublications.com and he can be contacted via www.coulson-thomas.com.

 

09 May 2013
Colin Coulson-Thomas

Investigation reveals quicker, more affordable and flexible approach to business process management

Advantages of focus upon helping key work groups outlined at Process Excellence 2013

Many approaches to business process management and process excellence are costly, time consuming and disruptive according to Prof. Colin Coulson-Thomas, speaking at Central Hall Westminster at the Process Excellence 2013 conference. The author of Winning Companies; Winning People believes “there needs to be a greater focus upon helping people to excel at key jobs within important processes.”

Coulson-Thomas believes: “The adoption and implementation of business process management (BPM) needs to reflect current issues, priorities and concerns. In a business environment characterised by innovation, uncertainty and insecurity speed of impact, flexibility and affordability are increasingly important.”

The professor’s report Talent Management 2 shows that providing job-focused performance support to key work groups can quickly deliver multiple benefits for individuals, organisations and the environment by working with one’s existing people and without requiring a change of corporate culture or structure.

His Transforming Public Services report shows advantages such as low barriers to entry and cost-effectiveness also apply to the public sector. Performance support can enable people to cope with new requirements and changes of policy and priorities that occur at different stages of a transformation journey.

Coulson-Thomas reported that: “Companies need to be more selective in their adoption of new BPM initiatives. Some adoptions of process excellence approaches result in the initiation of too many process improvement and/or re-engineering projects. These can be a source of confusion and pull people in different directions.”

The professor suggests: “Prioritisation and focus are increasingly important. Endeavouring to be the best at everything can be unaffordable when customers are only willing to pay for improvements that impact directly upon them. Priority should be given to process excellence projects that have a direct impact upon the customer and are a source of competitive advantage.”

Coulson-Thomas believes “The customer is the source of all value. BPM needs to be driven by customer as well as corporate interests and also reflect the requirements of other stakeholders. Too often they appear to be motivated mainly by corporate priorities. Front-line work groups in direct contact with customers and prospects should be the first to be better supported.”

He also finds: “Integrity and trust can be vital for building longer-term and mutually beneficial relationships with customers and other stakeholders. Process excellence initiatives should deliver clear benefits for customers and employees as well as an initiating organisation.”

Coulson-Thomas investigations have revealed that “some companies adopt a mechanistic rather than a thinking approach. They work through the various stages of BPM methodologies without considering their relevance and applicability to local issues and a particular context. Process excellence approaches should be adapted by an adopting organisation to suit its own requirements and circumstances.”

The professor argues that “BPM approaches should be regularly reviewed and modified in the light of experience and changing requirements and priorities to ensure that they are still affordable, current and vital. Continuous improvement itself needs to be continuously improved to ensure a focus upon affordable routes to high performance organisations.”

Prof Colin Coulson-Thomas, a Change Agent and Transformation Leader award winner, is author of Winning Companies; Winning People, Talent Management 2, Transforming Public Services and over 40 other books and reports. He has helped over 100 boards to improve director, board and corporate performance and spoken at over 200 national and international events in over 40 countries. He was the world’s first professor of corporate transformation and is a member of the business school team at the University of Greenwich. His latest reports are available from www.policypublications.com and he can be contacted via www.coulson-thomas.com.

Prof. Colin Coulson-Thomas was speaking at Process Excellence 2013 held in London at Central Hall Westminster. His presentation drew upon his recent reports Talent Management 2 and Transforming Public Services, and a forthcoming report on knowledge management which draw upon a five-year investigation of quicker and more affordable routes to high performance organisations.

 

06 May 2013
Colin Coulson-Thomas

Case for more productive and affordable learning put to Corporate Learning Summit

Five-year investigation reveals advantages of key job-focused performance support

Too many people are offered general learning programmes rather than the specific and personalised support they need to be effective in their jobs, according to Prof. Colin Coulson-Thomas speaking in Chicago at the 2013 Corporate Learning Summit. He believes “corporate learning needs to re-focus upon helping key work groups to excel by adopting the superior approaches of high performers.”

The professor was critical of many contemporary approaches: “What is being shared is often ‘commodity knowledge’ that is available to others. It does not differentiate or represent a source of competitive advantage. It is hard to stand out, innovate and become a market leader by copying everyone else.”

Investigations for Coulson-Thomas’ report Developing a Corporate Learning Strategy revealed that many organisations could obtain a higher return on their expenditures on corporate learning if a different approach were adopted. “There needs to be greater prioritisation and focus upon quickly delivering tangible improvements to performance and other corporate objectives.”

The professor’s report Talent Management 2 shows that integrating working and learning and providing job-focused performance support can deliver multiple benefits for individuals, organisations and the environment by working with one’s existing people and without requiring a change of corporate culture or structure.

His Transforming Public Services report shows advantages such as low barriers to entry and cost-effectiveness also apply to the public sector. Performance support can enable people to cope with new requirements and changes of policy and priorities that occur at different stages of a transformation journey.

Coulson-Thomas also led the investigation for the Managing Intellectual Capital to Grow Shareholder Value report. The investigating team looked at 20 areas of intellectual capital and found that even the best companies were only effectively managing a few of them. Categories of know-how managed are not always the ones offering the biggest potential for additional income.

He finds: “Training and development inputs are not giving rise to intellectual capital outputs. Many people draw from the wells of corporate knowledge. Far fewer add to them. Corporate learning should result in the creation of know-how and competitive advantage.”

The professor feels that “some companies could be many times their size if they fully exploited their corporate know-how. Imagine what these companies could achieve if they also properly exploited what their best people knew.”

In short Coulson-Thomas believes: “We need to step up from information and knowledge management to knowledge entrepreneurship.” Thirty seven possible revenue generating services using readily available information are listed in his book The Knowledge Entrepreneur.

The professor’s investigations reveal that: “Many corporate initiatives promise jam tomorrow rather than a measurable contribution to key corporate objectives today. Speed of impact can be vital. Competition is relentless. If today’s problems are not addressed, and new windows of opportunity are not quickly seized, a company may not have a tomorrow.”

Coulson-Thomas stresses that “corporate learning needs to reflect current issues, priorities and concerns. In a business environment characterised by innovation, uncertainty and insecurity speed of impact, flexibility and affordability are increasingly important. Performance support can satisfy all these requirements and simultaneously contribute to multiple objectives.”

Prof Colin Coulson-Thomas, a Change Agent and Transformation Leader award winner, is author of Developing a Corporate Learning Strategy, Developing Directors, Winning Companies; Winning People, Talent Management 2 and over 40 other books and reports. He has helped over 100 boards to improve director, board and corporate performance and spoken at over 200 national and international events in over 40 countries. He was the world’s first professor of corporate transformation and is a member of the business school team at the University of Greenwich. His latest reports are available from www.policypublications.com and he can be contacted via www.coulson-thomas.com.

Prof. Colin Coulson-Thomas was speaking at the 2013 Corporate Learning Summit held at the Hotel Sax Chicago in the USA. His presentation drew upon his recent reports Talent Management 2 and Transforming Public Services, and a forthcoming report on knowledge management which draw upon a five-year investigation of quicker and more affordable routes to high performance organisations.

 

06 May 2013
Colin Coulson-Thomas

World congress call for greater integrity in corporate boardrooms

Keynote address advocates action to deal with fraud, corruption, miss-selling, false labelling and abuses of power.

More integrity, heart and soul are required in corporate boardrooms according to Prof. Colin Coulson-Thomas in a keynote speech to the world congress on leadership and the quality of governance in Bangalore, India. With newspapers reporting a succession of scandals the author of Developing Directors, a handbook for building effective boardroom teams, called for individual, corporate and Government action.

Coulson-Thomas believes “integrity is necessary for establishing relationships of trust, within the boardroom and with stakeholders. A true heart and honest soul can engage and connect with people who want to work for, invest in, buy from or collaborate with companies they feel will be open with them and treat them fairly.”

However, the professor suggests that “despite its importance, integrity cannot be assumed. Misrepresentation, distortion, deception and dishonesty abound. People exaggerate their achievements on CVs. They miss-sell and falsely label offerings. They claim credit for other people’s efforts. They talk up stock they would like to sell. Athletes take drugs to enhance their performance. Fraudsters embezzle funds.”

Coulson-Thomas calls for realism: “Some people are invariably honest or dishonest. Others will do something they know to be wrong if it will benefit them and the risk of discovery and penalties are low in relation to what they might gain.”

“For organisations and societies the cost of monitoring, compliance and policing can be high. Instituting, managing and reviewing various controls and methods of prevention and detection can be time consuming. ‘Traditional’ controls considered essential can also constrain freedom, inhibit creativity and slow progress.”

“The costs and benefits of a lack of integrity are sometimes unequally shared. For some the payoffs from underhand behaviour can appear attractive, while its negative consequences can have a smaller impact upon a much larger number of people.
When illegality and corruption occurs a great many people can pay the price. False insurance claims by the few can mean higher premium payments for the many.”

Coulson-Thomas argues that “Pious statements are not enough. Directors can protect brands by supporting those who act with integrity. They can identify and mitigate risks, and deploy counter fraud strategies. They can adopt cost-effective ways of preventing abuse and ensuring compliance that do not restrain freedom, creativity and innovation. They can select people who instinctively ‘make the right call’.”

The professor called for a shift of emphasis from top-down management to helping people. “As well as boosting productivity, reducing cost, speeding up responses and ensuring compliance, performance support can enable people to act in desired ways and prevent actions that would contravene a law, regulation, policy or code. Miss-selling, a lack of trust and penalties imposed by regulators can be avoided. People quickly adopt support which makes it easier for them to do difficult jobs.”

When board appointments are made Coulson-Thomas believes that directorial competences such as strategic awareness are no longer enough: “In a complex and uncertain business environment ensuring that people with the right personal qualities serve on corporate boards has never been more important. Other candidates might be cleverer and more socially skilled. But when faced with difficult decisions and moral dilemmas will they assume responsibility, think for themselves, question and make fair, balanced and defensible decisions? ”

The professor suggested to world congress delegates: “It is in our long-term interest that we bring into corporate boardrooms people who act with integrity and instinctively do the ‘right thing’ – the ‘right thing’ by their individual consciences in particular circumstances, the ‘right thing’ for the reputations and prospects of their companies, and the ‘right thing’ for all our futures.”

Prof Colin Coulson-Thomas, author of Developing Directors, has helped over 100 companies to improve director, board and corporate performance, and spoken at over 200 national, international and corporate events in over 40 countries. An experienced board chair he is a member of the business school team at the University of Greenwich and has held professorial appointments in various countries and national and local public appointments. His latest publications can be obtained from www.policypublications.com and he can be contacted via www.coulson-thomas.com.

The keynote speech of Prof. Coulson-Thomas on the subject of Integrity: Regenerating Boards for Quality Leadership was delivered at the 23rd World Congress: Leadership & Quality of Governance held at the Hotel The Lalit Ashok, Bangalore, India. The world congress was organised by the Institute of Directors of India which is dedicated to building tomorrow’s boards. A news item on the event can be found on: http://www.timesnow.tv/The-23rd-World-Congress-on-leadership/videoshow/4420773.cms

 

17 Feb 2013
Colin Coulson-Thomas