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EXECUTIVE PROFILE Michał Sztanga is a member of the leadership team and the Managing Director of Future Processing. He is responsible for the day-to-day operations of the company, with particular emphasis on cooperation with clients seeking to develop their business with the help of software. He completed MBA studies at the Kozminski Academy, post-graduate studies in project and business management at the Warsaw School of Economics and obtained a master’s degree in computer science at the Silesian University of Technology. but it is not always so simple in execution, especially that is about using technology to help us to realise when it is inconvenient to follow such rules. In my our full potential and have a positive impact on the opinion, being consistent in your actions and words world. This is the mission that we are aiming for. is an important ingredient in building trust. When and how we will get there remains unknown.   What message would you like to get across to What excites you most about the field of soft- all the industries when it comes to digital trans- formation? What are the important factors to ware development? What are your short- and consider in order to increase the success rate of this process? long-term goals for Future Processing in the Be realistic, start with your real pains, not coming years? buzzwords, and be aware that change requires your people to be on board. I am excited by the fact that software gives possi- bilities that we may use to our benefit. We may To end this interview,  we are interested to achieve objectives that were unachievable before. At know what the top things or activities are that the same time, I see that being in such a dynamic and a high-calibre business leader like you does to challenging industry as software development gives recharge during their day off from work?   people a chance to grow technically and personally – and also to unlock their potential. In the short I wouldn’t call myself a high-calibre business term, we are planning to strengthen our ability to leader; I am sure that there are many more-experi- be a trusted advisor to our clients, to improve our enced and talented business leaders out there, but ability to acquire new business, with a focus on thank you very much – it’s nice to hear something growth in DACH markets. We will aim to continue like that. Recently, on my day off, when the weather to be below market average when it comes to team allows, I ride my motorcycle. If not, I tinker with it voluntary turnover, and to keep on improving our in my garage. I also do kick-boxing and try to spend team motivation and efficiency. On the offer level, quality time with my family. we will grow competencies and services in the areas where there is the most demand, such as product Thank you very much Mr Michał Sztanga. It development, data solutions and cloud. With regard was a pleasure speaking with you to the long term, I prefer to plan in a perspective that is manageable and leave the long term to unveil itself, especially as FP has a clearly defined mission I prefer to plan in a perspective that is manageable and leave the long term to unveil itself, especially as Future Processing has a clearly defined mission that is about using technology to help us to realise our full potential and have a positive impact on the world. www.europeanbusinessreview.com 51

Coaching THE COACH ROUTE TO TRANSFORMATION: Interview with Ms Gina Lodge CEO OF THE ACADEMY OF EXECUTIVE COACHING (AOEC) Businesses across all industries have discov- I am lucky to work in been a part of The Academy of Executive ered that executive coaching is one of the an industry that inspires most versatile and powerful change manage- Coaching (AoEC) since 2008. What was ment tools available to organisations today. me every day and I Celebrating its 20th Anniversary this year, the am passionate about the journey like in becoming the CEO of Academy of Executive Coaching (AoEC) has continuing to make the been delivering just that. CEO Gina Lodge place of work better for a successful global executive coaching and speaks to us about their world-class accred- all by using coaching. ited coach training and coaching-based training consultancy? How does being solutions and sets out what makes them one of the world’s most trusted executive an AoEC graduate help you in driving the coaching company today. academy to further heights? Good day to you, Ms Lodge! Thank you very much for meeting with us today. To People talk all the time about the exams you start, can you share with us some of your need to pass, the skills you need, but time and favourite morning routines to kick-start and time again, I have seen how important the human ensure a productive day ahead? dimension is for everyone to succeed, feel happy and fulfilled, and know what to do when things I usually begin my day by walking in the forest go wrong between people and teams. with our dog, which is uplifting at any time of year, followed by breakfast and a quick catch-up I have worked my way up through organisa- on the latest world news over breakfast. tions and met many fantastic people on the way. I’ve been able to build important and valuable relationships, but I have also made time to listen first, learn, keep on learning and to look out for and take opportunities. At the AoEC, I am lucky to work in an industry that inspires me every day and I am passionate about continuing to make the place of work better for all by using coaching. You have a very impressive and extensive For 20 years, the AoEC has been providing background in management roles and have top-notch coach training across the globe 52 The European Business Review November - December 2019

The AoEC prides itself on offering programmes which expose participants to a broad mix of the best in theory and practice. We use experiential learning to allow our course participants to experience and practice coaching from day one and we do not restrict them to just one model. in four continents. Can you share with us how The AoEC prides itself on offering programmes The Academy which expose participants to a broad mix of the of Executive AoEC started and some significant milestones best in theory and practice. We use experiential Coaching (AoEC) learning to allow our course participants to expe- has been committed to of the academy so far? rience and practice coaching from day one and we maintaining the highest do not restrict them to just one model. professional standards. In 1999, executive coaching was having a big impact in the United States and it was a completely We use a coaching style to facilitate their work, Coaching new concept here. The AoEC came about then learning, development and thinking. Our faculty Largest pool of because our founder John Leary-Joyce realised that (who are all coaches in their own right) are highly accredited coaches executive coaching could be a good fit for the work trained to a set of criteria which is about their ability he was doing in the leadership and group facilita- to facilitate, rather than stand up and just teach. Consulting tion space, so he reduced his clinical practice to We must provide psychological safety and be able Sustainable work as a coach. to provide those people on our programmes with outcomes for your high-quality feedback. organisation John had also spotted a gap in the market where, although foundational courses were available, Generally, many of our graduates will tell you that Training nothing took coaches into the deeper psychological they were transformed through the programme. Not Trained over 11,000 area while applying it in a business context. Coaching only were they learning advanced coaching skills, but people worldwide was still very much in its embryonic stages then and they developed personally and professionally in a there wasn’t much understanding as to what it could whole range of ways – not least in their confidence. offer, but that observation led to the creation of our flagship Advanced Practitioner Diploma programme. With our training programmes, high quality is achieved because our courses are accredited by the As an organisation we have grown in line with industry’s main professional bodies and the expe- the coaching industry. As coaching has become riential nature means participants are practising universally accepted as a proven development tool, coaching right from the start. our training programmes have matured, too, and we now offer team coaching and specialist work- The efficacy of executive coaching has been shops for further professional development. in demand to meet the challenges of today's fiercely competitive business world successfully. Our market stretched beyond the UK quite early Can you share with us some of the best feedback on as we initially responded to a demand for coaching you have received from your clients? services in China. This has grown steadily over the last decade and we now have training programmes and faculties in Brazil, Africa, the Middle East and the wider European continent, such as Poland and Croatia. Our consulting arm has flourished, too, and we are working with client teams all around the world, because we are in a strong position to offer coaching expertise in most locations. AoEC is known not only for its combined expert consultancy, coaching, training of internal coaches, leadership and management develop- ment services but also for helping graduates develop their own model known as the ‘signature presence’. How does this unique approach set AoEC apart from its competitors? What are the other inimitable features of your training services www.europeanbusinessreview.com 53

Coaching The Academy of Executive Coaching transforms in shaping leaders and executives individuals, teams and organisations globally through who can facilitate this change? world-class, accredited executive and team coach training and coaching-based solutions for organisations. Coaching is no longer a remedial tool They have successfully trained and deployed coaches and is being used to support personal throughout the UK and Europe since 2000. development and make high-performing individuals or teams even more effective. Numerous clients have discovered engagement from their teams have been However, coaching still has a huge role to the benefits of partnering with us and clearly evidenced, building a strong play as we move into the new digital era. we have a diverse client base, working business case for ongoing investment. with a wide range of industries such Organisations are facing new chal- as financial services, manufacturing, We have a thriving community of lenges and must find ways of succeeding healthcare and entertainment. alumni and are humbled every time we in a time of super-fast change and speak with people who have completed complex stakeholder needs. The priority We’re very proud that a lot of these one of our diploma programmes. We is for senior leaders to prepare their are long-standing working relation- are genuinely amazed at the impact the employees to work and think in new ships because they are continually using training has on people and the bonds ways. Organisational coaching and resil- coaching throughout the business. Many that are formed between people on our ience coaching can make senior managers have crafted leadership and talent-devel- programmes. To see people’s transfor- better able to develop strategies to opment programmes that we support, mation is inspiring and we are honoured keep them ahead of the competition. and a lot are introducing new employees to play a small part in this. It’s imperative that workers should be to a working environment which has a equipped with the right capabilities and coaching culture at its heart. Transformational leadership plays skills to work through change-man- a crucial role in creating positive agement programmes and apply agile One particular example is the work we changes and sustained success in approaches to solve problems and create have done to support the Ambassador today’s fast-changing business world. value for stakeholders. Theatre Group (ATG). Their initial goals How important is executive coaching were related to succession planning, Coaching offers many positives using coaching as a means to support Coaching is no longer a for businesses and underpins every high-potential employees and creating remedial tool and is being touch point of a people-management a talent pipeline. This is still true, but used to support personal strategy. From leaders to young profes- the application of coaching has broad- development and make high- sionals starting their careers, a coaching ened considerably and the benefits of performing individuals or approach builds skills and resilience, while establishing a coaching culture across teams even more effective. putting humanity back into processes the organisation have gained traction and practices. It’s time to lose outdated because it has shown how it can play a management practices and really unlock pivotal role in supporting growth and the potential that your workforce offers. continual improvement. What are the common roadblocks The feedback from Paul Williamson, that usually affect the success of the head of talent development with ATG, coaching programmes? How do you has been that they have seen real busi- meet the different demands of your ness results from those leaders that have clients and ensure that the impact participated in their in-house develop- will be long-lasting? ment programmes. Improvements in the financial performance of their area The industry faces many of the same of the business, and higher levels of issues it has always faced. The main one is the need for professionally accred- ited coaches. That works on two levels, with some organisations mistakenly assuming that employees sent on short coach-training courses will automati- cally return as qualified coaches. The 54 The European Business Review November - December 2019

other is a need for self-employed coaches to invest We take an learning as a result. AI will influence coaching, too, in training with an accredited provider, so they can end-to-end so I would expect there to be more development in show best practice and accountability. and proactive applications like CoachBot as time progresses. approach, Other roadblocks include big external pressures, where we look AoEC is one of the few coach-training such as the threat of recession or political uncer- at the client’s providers to hold a triple accreditation with the tainty. Rather than investing in resources to help industry’s major professional bodies for its core future-proof the business, L&D budgets can be cut needs programmes. How would you position AoEC as a and staff made redundant, and it becomes more as a whole. global leader in the executive coaching industry? difficult to hire or retain key skills. What industries are most likely to benefit from The AoEC your coach training and consultancy services? Many industry sectors are faced with a skills Consultant Team shortage and we are seeing a lot of graduates entering are experienced I believe that every industry can benefit from the workforce without having key soft skills, like coaches with coaching. Coach training might be more obvious problem solving, creative thinking and teamwork. expertise helping in larger organisations, because they have more Well-being and resilience can be often overlooked, businesses employees, an HR team and several layers of too. Organisations need to be investing in their develop their management, but leaders in, or owners of, small employees’ potential, so they have the ability to cope people. businesses can profit from it, too. with change and come up with new ideas. Those trained in coaching skills will find that What do you think are the emerging trends their management approach improves towards and developments in the executive coaching their direct reports and fellow colleagues. industry, and how will digital transformation Employees who have received coach skills training redefine the industry’s future? How does AoEC also stand to gain, because they have more ability prepare for these developments and what are to work through problems, think laterally and your strategies to stay ahead of the curve? have better communication skills. Globalisation is an important factor, too, so when working with I think you will see coaching being offered to organisations that have cross-cultural teams, the more and more employees, including those starting key is to ensure that the training they receive is their working lives. We’ll also see the continued consistent across the board. demand for team coaching, because organisations are embracing collective leadership and working For the AoEC, we have built a strong reputation in teams. Technology will play a bigger part in in developing individuals, teams and organisa- how learning is delivered, and businesses are more tions, because we take an end-to-end and proactive likely to invest in in-house academies to scale their approach, where we look at the client’s needs as a whole. There might be an initial need for leadership coaching, but if clients are wanting to attain sustain- able and lasting change, it may be that team coaching or resilience coaching is more appropriate for board members or at other levels within the company. Bringing the system in can yield huge opportuni- ties for learning and growth. Organisations operate within much larger ecosystems and, by understanding the needs of suppliers, partners, employees, share- holders and customers, we can help coach those connections and develop strength and value where it really matters in the long term. As an accredited executive coach and a successful graduate of the AoEC, what are the key takeaways you have personally gained from the programme that you would want to share www.europeanbusinessreview.com 55

Coaching For me, success comes from concentrating on delivering outstanding results, inspiring relationships and building a cast-iron reputation for trustworthiness. This way, success can be shared and sustainable. with our readers? How does this help you create value trust our employees and, above all, we appreciate and recog- for yourself and for the organisation as a whole? nise their contribution to the AoEC’s success. We genuinely couldn’t do what we do if we didn’t have such an excellent The biggest takeaway for me was the opportunity to team in place. reflect on ‘who I am’ and what it means about what I bring to coaching. Our courses are immersive, with a huge emphasis Maintaining a healthy work-life balance is just as on the practice element, so that really helped me gain confi- important as propelling your company to sustainable dence in my coaching skills and leadership style. success. Can you share with us how you spend your time off work? My philosophy is that leaders are there to set the direction and to guide and support their colleagues to be their very Spending time with family and friends is a priority, plus best, enjoy what they do, and have a sense of achievement I enjoy reading, watercolour painting, listening to classical in their working lives. I believe in treating people as people music, travel and long walks in the countryside. rather than employees, regardless of what they do and who they are. Curiosity, kindness and respect are three qualities of To end this interview, how do you define success? high importance to me. Most companies wish to grow, and there is nothing wrong with creating profit, but this can be a soulless endeavour. At the AoEC, we have a relatively flat management structure For me, success comes from concentrating on delivering and the purpose behind that is to ensure that our employees outstanding results, inspiring relationships and building a have full autonomy in the jobs they do. We encourage clients cast-iron reputation for trustworthiness. This way, success to have a coaching culture, rather than a command-and-control can be shared and sustainable. style, and this is how we do business ourselves. We say how it is, try to do the right thing, stick together and try out new things. Thank you very much Ms Lodge. It was a pleasure We want our employees and customers to do well and the envi- speaking with you. ronment we strive to create is about enabling them to do that. How do you create a happy workplace and foster a healthy and beneficial competitive environment for your employees? As the CEO, how do you ensure your employees’ well-being? We spend so much of our time at work that it is important that we enjoy it! We’re very purpose-driven, and I think all of our team live our core values. As CEO, I’m responsible for ensuring that everyone has the skills and resources that allow them to deliver. My fellow directors and I support everyone to achieve, and sometimes that is not an easy task when you all work remotely. We invest in developing our team members, so they can do their jobs to the best of their ability. I am committed to making sure that we are not judgemental and that we operate in an open environment where new ideas are welcomed and tried out. We offer the usual flexible working, but I think what sets us apart is that we actively celebrate our people’s successes, we 56 The European Business Review November - December 2019

Is coaching the solution to your organisation’s biggest challenges? As we enter an era of business where collaboration outperforms competition as a strategy for success, the use of coaching has never been more important. Progressive organisations are prioritising the customer and Speak to us today to discover how our tailored coaching- putting their people and purpose first. If you are seeking ways based solutions and in-house coach training programmes can of improving your performance, finessing your leadership support you at an individual, team and organisational level. development, engaging your workforce to their full potential If you want to realise positive change, we can help you to or want to be recognised as an employer of choice, then a build effective people management strategies, better serve coaching approach can enable your business to achieve your stakeholders and become more resilient to master the organisational excellence. headwinds the digital era brings. www.aoec.com

The Stakes are HIGHER, The Risks are GREATER, The Possibilities, LIMITLESS. Now’s your time for next-level success. comprehensive programs for senior executives: Be WHARTON READY. Advanced Management Program Reaching a certain level of success prompts the question, may 31–jul. 3, 2020 | sep. 27–oct. 30, 2020 “What’s next?” Prepare for bigger challenges with transformative learning experiences and top-tier executive Alumni status granted upon program completion coaching from Wharton’s programs for senior executives. Join an invaluable network of global leaders while building Executive Development Program a legacy that will resonate throughout your organization. mar. 15–27, 2020 | sep. 13–25, 2020 make your move › General Management Program a flexible six-program learning journey execed.wharton.upenn.edu/ebr Alumni status granted upon program completion NEW Advanced Finance Program six finance programs in two years Alumni status granted upon program completion

Executive Education Where Entrepreneurs Learn the Business of Business How Wharton Executive Education gave one European entrepreneur the business skills to launch his company A fter more than 20 years in R&D of most of the disciplines that comprise a busi- Wharton's General management positions – the last eight as ness (a clear advantage over those with more Management Program? chief technology officer and member of limited experience). But he decided he needed The General Management the board – Jürgen Götzenauer, PhD started his more. “My background is as a technician, so I Program (GMP) is a flexible own advisory company earlier this year. always saw the business from that perspective,” approach to obtaining an he says. “When I was CTO, I had to broaden advanced level of executive Such a move might be unremarkable in the my view. I needed to be competent discussing education. Intended for United States, where almost 14 percent of those finance, marketing, and strategy and I wanted to executives for whom who are working age are running their own busi- learn from the best sources available.” professional development is a nesses, according to the Global Entrepreneurship priority, GMP is structured to Monitor (GEM) study. But the average for the Götzenauer says in addition to gaining support career advancement European Union is just over 7 percent, and that broader view, what he learned while with a curriculum that is according to the European Commission, only 37 gaining his MBA needed an update because rigorous, comprehensive, and percent of Europeans would like to be self-em- the business world is changing so quickly. He highly experiential. ployed (as opposed to 51 percent of Americans). started researching his options and found the General Management Program (GMP)1 But the EU numbers are on their way up: Götzenauer has joined a growing number of at the Wharton School of the University of European entrepreneurs who have left the Pennsylvania in the United States. “I enrolled in corporate world to go solo. According to the the General Management Program because Wharton GEM report, societal attitudes about entrepre- is the best school to help move from a technical neurship in the EU are becoming more positive manager to someone with true general manage- and startup funding is increasing. ment expertise,” he says. With degrees in computer science and busi- Entrepreneurs’ need for this kind of exper- ness administration, Götzenauer had knowledge tise, research shows, is very real. In fact, a 1. https://executiveeducation.wharton.upenn.edu/for-individuals/all-programs/ www.europeanbusinessreview.com 59 general-management-program/?utm_source=ebr&utm_medium=print&utm_ content=oe&utm_campaign=ebrcont20print

Executive Education Wharton provides world-class executive education that is innovative, Expert Faculty evidence-based, practical, and results-focused to prepare individuals and organizations for greater success. Wharton’s programs provided what Götzenauer • Open enrollment for Individuals and Groups calls “a true Ivy League academic experience. You • Custom and Blended Programs for Organizations are taught by the top professors in their fields, • Online Learning for Executives and the amount of knowledge they share is really impressive. You are with them for a short period of number of studies of both successful and failed time but they are able to cover so much content.” startups show that “leadership with general and domain-specific business knowledge” was He says after a week attending a course at Wharton a requirement for success. It turns out a large called Finance and Accounting for the Non-Financial number of entrepreneurs take huge risks – both Manager, he flew back to Austria understanding to themselves and their investors – without solid all of the high-level finance topics needed for a grounding in what it takes to run a business. top management position. “It was the same for marketing, organizational behavior, and innovation,” That’s where Wharton’s General Management he adds. “Every program stands out because of the Program comes in. It requires participation in six faculty and the comprehensive content.” week-long courses: one each in finance, leadership, marketing, and strategy or innovation, plus two elec- A highlight of the experience was learning from tives, over two years. Götzenauer says the flexibility Wharton Management Professor Nicolaj Siggelkow, of the curriculum was important: “There are so a protégé of strategy guru Michael Porter. “In my many programs offered that it is easy – even with strategy and marketing classes in Austria, we studied a 14,000 kilometer commute – to create a schedule Michael Porter by reading. At Wharton, I learned to complete them all in two years.” from the source. The biggest takeaway from Nicolaj’s Strategy and Management for Competitive Advantage course But with the business world’s speed of change, is gaining a more holistic view. His way of looking at it as Götzenauer notes, the need to refresh knowledge as a set of integrated activities was very impressive and and skills is ongoing. Once the General Management completely changed my view about what strategy is.” Program has been completed, participants are awarded alumni status, making them part of a global Although Götzenauer wrote his dissertation Wharton network with more than 98,000 members. on innovation, he was eager to take the Mastering Hundreds of Lifelong Learning events for alumni Innovation class as part of the General Management are held around the globe each year. They include Program’s curriculum. Led by professors Christian Global Forums, webinars, and tech-based chats on Terwiesch and Karl Ulrich, who are also co-authors topics such as data analytics, alternative investments, of the book called Innovation Tournaments, the Mastering and the science of startups. Innovation course at Wharton shows participants how to apply a structured, process-driven approach to innovation – a radical departure from the standard “let’s hope for a spark of genius” method. In previous runnings of the course, executives visited startups and high-growth companies in California’s Silicon Valley, learning from their successes and challenges in fast-growing and highly competitive markets. Strategic Marketing for Competitive Advantage was another course at Wharton that Götzenauer found illuminating for its innovative approach. Non-marketers develop a solid grounding based on A number of studies of both successful and failed startups show that “leadership with general and domain-specific business knowledge” was a requirement for success. 60 The European Business Review November - December 2019

strategy rather than tactics. It differs greatly from enough he had made the same decision. We decided “I knew by the much of today’s marketing advice and hype that to stay in touch. Now when a company from the US end that I had the focus on topics such as enticing consumers with wants to extend its business to Germany or Austria, tools, knowledge, influencers and interacting with them through AI he reaches out to me. When I have a client looking experience, and chatbots and social media platforms. The course to move into the US market, or to cooperate with network I needed. is taught by the same professors who teach in US companies, he has the network I need. This has Over two years, Wharton’s MBA program: experts in customer been a huge benefit of the GMP1 for both of us.” Wharton gave me analytics, pricing, competitive strategy, communica- tion, contagion and viral marketing, and branding. Developing an Entrepreneur’s Mindset the confidence Leaving a senior role in an established firm ultimately to see risktaking Connections that Count takes more than classroom knowledge and skills. Götzenauer says a highlight of his Wharton Götzenauer says he had considered going out on differently. Executive Education experience was meeting and his own “for years,” but he wasn’t ready to take the I was ready.” working with successful leaders from around the risk. “When I was in Silicon Valley with the Mastering world. Because acceptance requires at least 10 years Innovation program, seeing all of the startup activity – Jürgen of managerial experience and leadership respon- there, I realized if I really wanted to be an entrepre- Götzenauer, PhD sibilities, plus significant career achievement, the neur, I was going to have to change my mindset.” program draws top talent from a broad range of industries, roles, and geographies. Today, Götzenauer is a management consultant, focusing on supporting high-tech companies in By attending six individual programs, the number product development and innovation, and working of connections and networking opportunities is with potential investors on tech ratings and software substantial. “Everyone I met was high level, and they due diligence. He credits attending Wharton with were very diverse in terms of geographies, indus- helping him make the change. “I knew by the end that tries, and functions. I would not have been able to I had the tools, knowledge, experience, and network I grow my international network to include people in needed. Over two years, Wharton gave me the confi- medicine and law, for example,” says Götzenauer. dence to see risk taking differently. I was ready.” That network is already paying dividends. “I am working with someone from Washington DC who I met in the Strategic Marketing program,” he says. “I told him I was starting my own business, and luckily www.europeanbusinessreview.com 61

People THE 3 MYTHS OF EMPLOYEE AUTONOMY BY CARSTEN LUND PEDERSEN Employee autonomy is becoming one of the turbulent times, many organisations fail in their latest trends in business management with efforts to foster employee autonomy. Many of these many industries failing to implement and failed efforts can arguably be blamed on the preva- benefit from the change successfully. The lence of 3 tenacious myths of employee autonomy. article debunks 3 myths of employee autonomy Therefore, fully understanding and rejecting these and provides solutions to utilise when it comes popular misconceptions comprise a first step in to addressing autonomy in the workplace. leveraging the true potential of your employees7. The 3 myths are illustrated in the figure below, and A s digitisation is accelerating the pace of the following will both explain the myths as well as business, assigning accountabilities to actively bust them. employees, rather than relying on organ- isational structure to direct them, is becoming an idealised pathway to organisational agility1. In other words, having responsible and self-directed employees on board comprises a promising asset for organisations in an uncertain and dynamic world. Business magazines have long written about ways to promote employee autonomy, as seen in the many articles about Google’s 20% time2, the HR policy of Netflix3 or Spotify’s unique approach to work4. But these companies are not alone in their quest to empower employees and obtain agility5. In a knowledge-based economy where organisa- tions must deal with constantly changing business conditions, employee autonomy and distributed leadership have often been hailed as the preferred managerial remedy6. Although employee autonomy is undoubtedly important for navigating in these 62 The European Business Review November - December 2019













• What are the RISKS involved when you or and help others to speak up: If you have been brilliant others speak up? 1. How do you respond when someone 9 times out of the last 10 times you were • Do you UNDERSTAND the politics of challenges you or tells you something you challenged, but once who says what to who… and why? don’t want to hear? you reacted quite badly, Firstly, if you are now struggling to remember then unfortunately it • Are you aware of the TITLES and labels the last time someone challenged you, then you is this one time you will others attach to you and you attach to are probably really scary! If you can remember be remembered for. others – and how that shapes what gets said some instances, think back over a few and try in your conversations? to remember what you said and what body language and facial expression you might have • Do you know HOW to choose the right used. Think about what you did next – how words at the right time in the right place… did you act on what was said? How would the or how, skilfully, to help others to speak up person who spoke up feel? We know from through what they say and do? our research that one in four junior employees expect to be punished if they speak up about We use this framework in our book, Speak a problem. Punished here could mean some- Up, to help readers figure out how they thing as obvious as being fired or missing out might be scary to others and how to reduce on promotion, or it could mean being ‘told unhelpful power dynamics. Reflecting on off ’ or being lightly teased or ignored. listening up specifically, how would you answer these questions? If you have been brilliant 9 times out of the • Trust: Whose opinion do you value and seek last 10 times you were challenged, but once you reacted quite badly, then unfortunately it most often? Whose don’t you? is this one time you will be remembered for. • Risk: Imagine being in the shoes of different That will be the story that will be told and you will need to work hard to turn that around. colleagues: what might they be afraid might happen if they challenge you or ‘mess up’ in Helping others to speak up means you front of you (even if you disagree with their have to make them feel that you welcome take on this)? their thoughts and if they aren’t acted upon, • Understanding: Why do you get told certain you will need to explain why. things? What is the politics of what you get to hear? What don’t you get to hear so easily 2. What signals do you send out to because of who you are? others at work? • Titles: What labels do others put on you that Ironically, you might not know how you might increase your status and authority in respond – because no-one has given you their eyes (even if you disagree)? straight feedback on it (because you’re scary!) • How-to: How do you respond when you In our work we come across many individ- get challenged? How do you invite people uals (like the quickly promoted man referred to speak up? Specifically – what do you say, to above) who don’t realise how others read where, when and how? their non-verbal signals. They assume that the intention behind their behaviour is the same How to be less scary as its impact on others. Here are three questions, taken from our book, which, if you address, can lesson your scariness Developing and training leaders and managers (and in fact all employees) to listen up is perhaps even more fruitful than the work on speaking up. But listening up remains very much a ‘deaf spot’, something that we don’t even notice isn’t there. www.europeanbusinessreview.com 69

Communication Your colleagues are best placed meeting, it would really help me if you silence. You may well be lovely and to let you know what you may could look at the signals I am sending approachable; however, you may need not realise about yourself – but out and let me know at the end one to work harder than you think to enable of course you have to make thing that I could do that would help others to speak up freely to you. it safe and easy for them to others to speak up even more freely’ give you this feedback. may elicit more information. About the Authors Megan Reitz is Professor of We are all wired to watch others Your invitation is important and you Leadership and Dialogue at extremely carefully in order to judge have to make it easier for others to give Hult International Business whether it is safe to speak up. An you challenging news. Other strategies, School, where she speaks, errant eyebrow, or a ‘thinking face’ that we mention in the book, include researches and consults on that, because of its frown gets trans- the CEO who instigated a ‘devil’s advo- lated into ‘disagreement’, is enough cate’ card in her new and submissive the intersection of leadership, change, to silence others. team – the person with the card had dialogue and mindfulness. She is on the to offer the challenging voice to any Thinkers50 Radar of global business Your colleagues are best placed decisions being made. She used their thinkers and listed as one of HR to let you know what you may not habit of compliance to institution- Magazine’s most influential thinkers. She realise about yourself – but of course alise speaking-up! There was a leader is author of Dialogue in Organizations and you have to make it safe and easy for of a public sector department who, on Mind Time and her new book, written with them to give you this feedback announcing a restructure via Skype, John Higgins, is called Speak Up: Say what gave out the information in fifteen needs to be said and hear what needs to be heard 3. How do you invite people to... minutes and then shut down the call (Financial Times Publishing, 2019). speak up? for an hour. The department staff in Inviting others to speak well requires their local, small teams were given the John Higgins is Research you to think about why, who, what, chance to discuss the news and come Director at Gameshift and is when and where: up with questions collectively (and an expert in psychologically • Why do you need to hear therefore more safely) which were literate organisational working. certain voices? then responded to when the call was Drawing on his experiences • Whose voice don’t you hear that opened up again. as a researcher, coach, consultant and you need to? tutor, his work focuses on working with • What words and body language Managers and leaders need to hear patterns of power to shift organisational should you use to make it easy for from employees. Personally, organisa- cultures to become more transparent the other to speak up? tionally and socially we cannot afford and humane. • When is the best moment to ask for input from others (in a group, one-to-one, when they are in a good mood)? • Where should you ask (virtu- ally, face to face, in a meeting, at the café)? Saying to your colleagues, when they are in the middle of something, ‘please give me some feedback’ may not elicit the best response. Saying ‘I’m trying to help the team to say what they think and feel – it’s really important. In this 70 The European Business Review November - December 2019

Compensation PAY SECRECY BY ADRIAN FURNHAM Even with today’s rapidly progressing society, Pay communication pay structure) is communicated to employees and there still exists a certain stigma towards the refers to if, when, even the general public. Both of the extremes of topic of salary or compensation. Employees how, and which pay communication practices (pay secrecy and have taken on what is called “pay secrecy” that pay information pay openness) consist of two aspects: organ- breeds the issue of “pay communication”. In (pay ranges, raises, isational restriction and employee restriction. this article, the author highlights two aspects averages, ect.) is Organisational restriction refers to the amount that further elaborate this matter, namely organ- communicated to of pay information the employing organisation isational restriction and employee restriction. employees and even gives to employees. Employee restriction refers the general public. to the extent to which employees are permitted to A female worker believes, with all the discuss their pay. current press stories, that she is unfairly underpaid compared with her male Your Choice colleagues. She asks one what he is paid Does your organisation have transparency as a core and he “confesses honestly” his full package. She value? And what is your policy with regard to “pay becomes enraged and goes public. His employer communications”. Do people know how much takes disciplinary action against the man because he each other is paid? And what are the consequences has signed an employment contract which prohibits of openness or secretiveness with regard to sala- employees from discussing their pay terms with ries, comp & ben, or whatever you call the reward others. Shocked to the core, he decides to sue his package? Is there a line in their contract about pay employer. Time for lawyers to rub their hands! A disclosure and why? Are they discouraged or prohib- curious case of pay secrecy. ited about disclosure? And what is the legal position: what can companies do legally? The issue here is called pay communication. Pay communication refers to if, when, how, and Consider the following situation. You have which pay information (pay ranges, raises, aver- started your own company employing 100 people at ages, individual pay packages, and/or the entire various levels? Data protection and confidentiality www.europeanbusinessreview.com 71

Compensation Does pay secrecy lead to lower motivation and satisfaction or the other way around? There have been studies on this topic. They tend to show that secrecy is prevalent in most organisations and that workers actually want it, though it may even be illegal. aside, you have four options with regard to the openness of less than older, less skilled and productive people who salary (or full renumeration) disclosure: have been in the organisation. A. You are completely transparent: full details of the (total) remu- Does pay secrecy lead to lower motivation and satisfac- neration package are known to all within the company. tion or the other way around? There have been studies on B. People know salaries in narrow bands: You are able to deter- this topic. They tend to show that secrecy is prevalent in most organisations and that workers actually want it, though mine salaries in a specific range i.e. £30,000-£35,000 or it may even be illegal. £60,000 to £65,000. C. People know salaries in wide bands: Like the above but now Research the rage is wider (£30,000-£40,000), perhaps even wider Some years ago in the Academy of Management Review Paper (£60,000 to £80,000). (Vol 32, 55-71) four American business academics looked at D. Total secrecy: Nobody knows the salary of anybody else and the costs and benefits of pay secrecy. They argued that there are forbidden (on threat of sacking) to disclose their salaries.. were various costs to: • Employee judgements about fairness, equity and trust Which would you choose for the benefit of all involved? may be distorted. If people do not know the salaries Justice and Fairness of colleagues infer or guess it. Incomplete data or There is a celebrated historical case. Nearly 100 years ago secrets can generate anxiety and vigilance about fair- an American company suddenly notified their staff that they ness. People may believe that if information is withheld were not allowed to disclose salaries to each other. They it is for good, though probably sinister, reason. This objected and supposedly walked around their building with may affect three types of justice judgements: informa- large signs around their necks showing their exact salaries. tional (it being withheld); procedural (lack of employee voice and potential bias) and distribution (compressing The pay issue provokes the F word (fairness) and the pay range). behind it the J-word (justice). It goes to the very heart of • Judgements about pay fairness will be based on a general what people feel is fair and just. Researchers in the area impression of fairness in the organisation. People see may have distinguished between different, but often related, things like hiring, firing, perks, awards that are dramatic types of justice. and memorable as examples of “fairness”. Thus if they have a “fair but secret” pay policy it will be judged unfair Distributive Justice which is the fairness associated with deci- if other, perhaps unrelated, actions do not look fair. The sion outcomes and distribution of resources like pay. nature and context of the contract is everything. • Secrecy breeds distrust while openness signals integrity. Procedural Justice which is about fairness of the processes Secrecy can signal that the organisation does not trust its that lead to decisions. employees. Therefore secrecy can reduce motivation by breaking the pay for performance linkage. Interactional Justice refers to the treatment that an individual • People perform best when given goals/targets/KPIs receives as decisions are made Interpersonal justice refers to which are explicitly linked to rewards. Therefore if they perceptions of respect and treatment. do not know the relative worth of the rewards (i.e. in pay secrecy) they may well be less committed to their Informational Justice relates to the adequacy of the explanations goals and targets. given in terms of their timeliness, specificity, and truthfulness • Pay secrecy can also affect the labour market because it can prevent employees moving to better-fitting and All of these sources of justice can be involved in rewarding jobs. Pay secret organisations may not easily pay communication which makes the whole business lure or pull good employees from other organisations. so hot. The problem with determining salaries is mani- fold. Because output and productivity are often hard to measure, salary may be best determined by seniority rather than productivity; though this can now risk issues of age discrimination This may mean that hard-working, highly skilled and productive young people may be paid much 72 The European Business Review November - December 2019

But on the other hand pay secrecy can pay of others for not having their (number of calls made, number of deliver real advantages to the organisation: own package made open. widgets sold), the more difficult it is to • Secrecy can enhance organisational • Secrecy may increase loyalty, or put keep things secret. more negatively, to create labour control and reduce conflict. Pay market immobility. If people can’t Next appraisal systems strive to be differentials can and do cause jeal- compare their salaries they may be objective, equitable and fair. The more ousy, debate and disenchantment. less inclined to switch jobs to those they are, the less need for secrecy. Making pay open often encourages which are better paid. So you get Where objective criteria are used will managers to reduce differences: the what is called continuance commit- staff have less concerns for secrecy?. So range distribution is narrower than ment through lack of poaching. subjectivity and secrecy are comfortable the performance. So, paradoxically, bed-fellows. People don’t know under secrecy increases fairness in the Clearly the cost-benefit ratio of open- pay secrecy what their pay is based on: equity sense, because people can ness to secrecy depends on different secrecy means they can’t predict or more easily be rewarded for the full things. Much depends on the history believe that in any way they can control range of their outputs. of the organisation and equally on their pay usually by increasing it. • Secrecy can prevent or mitigate whether good, up-to-date, accurate, “political” behaviour. Openness is industry compensation norms really When their pay is secret people both economically inefficient and exist. What is – on average – a senior have to guess how they rank relative likely to cause conflict. partner in a law firm, a staff-nurse, to others at the same level. That, no • Pay secrecy allows organisations or a store manager paid? What about doubt, is why high performers want more easily to correct historical and an account, a security guard or an IT secrecy more than low performers; other pay equity anomalies. Thus specialist? The public industry norm they believe they are equitably being managers can both minimise unfair- information can, and does have a paid more and want to avoid jealousy ness and discrimination as well as powerful effect on organisations that and conflict. If you believe you are perceptions of those matters more opt for secrecy or privacy. well paid because of your hard work easily by secrecy. then all is well with secrecy. But what • Secrecy benefits team work, One issue is how the organisation if you don’t? particularly in competitive individ- does or claims to, determine criteria uals, organisations and cultures. It for pay allocation. Do they increase Changing the System encourages interdependence rather payment for years of service, for level/ When pay secrecy is abolished some than “superstardom”. rank, for performance on the job, or people not only feel angry, they • Secrecy favours organisational pater- for some combination of the above? feel humiliated by exposure to rela- nalism because employees themselves The more objective the criteria seen in tive deprivation. They feel unfairly (perhaps unexpectedly) want secrecy, sales, perhaps the easiest job to assess dealt with and their easiest means of and to reduce conflict, jealousy and retaliation is inevitably to work less distress at learning about others. It can even be suggested that workers might make irrational decisions if they know what their colleagues are (really) paid. So paternalistic secrecy increases control and the “feel good” factor. • Secrecy is another word for privacy, which is of increasing concern in a technologically sophisticated surveil- lance society. Perhaps this is why surveys show people are generally in favour of secrecy, because they do not want their own salaries discussed by their co-workers. People are willing to trade-off their curiosity about the www.europeanbusinessreview.com 73

Compensation If your major competitors hard. People can adopt a range of retaliatory strange situations like this can generate jobs, and have a policy of processes, particularly if they know the organ- sometimes unintended consequences. openness and you have isation well and “where the bodies are buried”. one of secrecy this might Conclusion undermine your system. Pay secrecy relates to an organisation’s One can be very clear about three issues: There are “industry vision and values as well as individual job moti- standards” which you vation. Secrecy can lead to more management One, once you have abolished or reduced need to be aware of. control, bigger differentials and less conflict. secrecy the path back is near impossible. It But can you enforce it? Paradoxically the more really is a Genie and Bottle issue. And it may enthusiastically an organisation tries to enforce becoming inevitable as legislation is “drifting” secrecy, the more employees might challenge toward full openness. the notion. Individuals and groups chose to talk or not, in details and in generalities. Perhaps Two, if your major competitors have a younger and less well paid people are the most policy of openness and you have one of likely to “spill the beans” secrecy this might undermine your system. There are “industry standards” which you Finally pay secrecy may not always be “in need to be aware of. the gift” of the organisation. There are rules which govern it. Perhaps the most interesting Three, for total or even partial openness to and unusual situation is that of Norway (and work you need to be pretty clear in explaining Sweden) There you have the right and the how pay is related to performance at all levels. ability to look up everybody’s full (and hopefully You need to be able to explain and to defend your honest) tax return. Thus you can know the exact system: why people are paid what they are paid. salary of everybody in your organisation and that of Otherwise you open the most evil can of worms! your competitors. There is no legal possibility of secrecy. This state of affairs results from many Where possible many firms opted for a things, not least of which is the national culture quiet life, where because of a taboo about and the fact that wages (and taxes) are high and money-talk, no one knew or enquired about differential are low. salary or remuneration difference. This allowed all sort of peculiarities and injustices Imagine the fun of looking up the guests after to occur for years. Now bright lights peer into a typical middle class dinner party. It is particu- this murky darkness and a lot of explaining larly interesting if the bravado about houses has to be done. in France and the Caribbean are justified. And it seems often the quiet diffident ones are the About the Author richest of all. Adrian Furnham is Principal, Behavioural Psychologist at Stamford On this topic of transparency, one amusing Associates in London. He is also change that has occurred in Norway is that you Professor of Psychology at BI, The can now look up who looks you up. This is Norwegian Business School. He is probably meant to discourage a prurient form of voyeurism which can’t be good for anyone. author of over 90 books including The New Though of course one can pay others to do Psychology of Money. this and so remain anonymous. Surprising how References When pay secrecy is abolished some people 1. Bamberger,P, & Belogolovsky, E. (2010). The impact not only feel angry, they feel humiliated by of pay secrecy on individual task performance. Personnel exposure to relative deprivation. They feel Psychology, 63, 965-996 unfairly dealt with and their easiest means of 2. Belogolovsky, E., & Bamberger, P. (2014). Signalling in secret: retaliation is inevitably to work less hard. Pay for performance and the incentive and sorting effects of pay secrecy. Academy of Management Journal, 57, 1706–1733. 3. Colella A, Paetzold R, Zardkoohi A, Wesson M. (2007). Exposing pay secrecy. Academy of Management Review, 32, 55–71. . 4. Marasi, S., & Bennett, R. (2016). Pay communication: where do we go from here? Human Resource Management Review, 26, 50-58. 5. Rosenfeld, J. (2017). Don’t ask or tell: Pay secrecy policies in US workplaces. Social Science Research, 65, 1-16, 74 The European Business Review November - December 2019



Management “Managing by Values”(MBV): Innovative tools for successful micro behavioural conduct BY ANAT GARTI AND SIMON L. DOLAN Because the environment “Values values on the wall, just do the busi- & Richley, 2006; Dolan, 2011 and 2019; Dolan has changed so ness and forget them all” wrote Liran and 2020)2. Over the years, and as a result of Garti’s dramatically, managers Dolan (2016)1 as a title for one of many work as an organisational consultant and as a have found it necessary articles Dolan wrote with colleagues on couples and family therapist, several comple- to alter their practices in working with values in organisations. The mentary tools were developed and will be order to meet the needs message is clear. In many cases, organisa- described hereafter. In this paper four of these of the times. tions do not consider values seriously. They tools are described: (Tool # 1) Behaving Your adorn themselves with nice values and miss Values, (Tool #2) The value of the “Values’ Pie”, the core idea of values – managing the way (Tool #3) The value of the “Value Anchor”, and we think, feel and behave. The objective of (Tool #4) The value of the “Value Message”. All this short paper is to propose a series of these tools represent different components of the ideas on how to render the MBV concept full MBV model. A particular set of applications truly operational, so that the full potential of was recently described in a short book addressed this revolutionary concept can be rendered to parents and entitled “The parent as a value anchor” instrumental. The tools and methodology (Garti & Dolan, 2016)3 as well as Chapter 7 (in have been developed and experienced in Spanish) in Dolan’s most recent book entitled: different settings and they really do not fail Más Coaching por valores (Dolan 2019)4. – they deliver excellent results. It all began with Dolan and colleagues’ How do values become a daily reality rather description of the evolution of the school of than an empty declaration on the wall? thoughts in management due to the increasing To this end, Dolan developed over the complexity in the environments that organisations years several models that invite organisations operate. Figure 1 summarises this evolution that and individuals to examine what is important started with MBI (Managing by Instructions) to them and manage their life accordingly – to MBO (Managing by Objectives) and finally Management by Values (MBV) with its core to MBV (Managing by Values). The evolution model of the 3Es Tri-axial focus (Dolan, Garcia is driven by the need to manage environmental and intra-organisational complexities5. 76 The European Business Review November - December 2019

Because the environment has not that the goals were lofty or unreal- Values systems are the changed so dramatically, managers have istic; simply, many unforeseen changes motivators that drive the found it necessary to alter their practices occurred that were not and could not behaviour of individuals, in order to meet the needs of the times. have been predicted. As a result of this organisations and society, In the early 20th century, Management growing complexity, scholars began to leading today to the by Instruction (MBI) was considered to draw upon chaos and systems theories to emergence of Management be an appropriate and adequate way to better understand organisational behav- by values (MBV). run an organisation. Change happened iour. During this period, organisations at a slower pace and therefore the way came to be seen as complex and dynamic process we borrow the evolution from things were done in the past worked systems existing in a state of flux and management by instruction (MBI) to well enough to pass on to others. By interaction with their environment. Years management by objectives (MBO) the 1960s, change was accelerating to of research have confirmed that the and then to the present concept of the point where more flexibility of key to understanding the behaviour of managing by values (MBV) which truly action was required by managers. Thus, such systems is to understand the corre- helps to leap into the future, as it helps the introduction of Management by sponding values of these living systems. built an excellent compass in a VUCA Objectives (MBO) enabled managers to Values systems are the motivators that world (Dolan, 2016, Dolan, 2020)6. agree on a direction and to choose their drive the behaviour of individuals, When translating values into behaviour, own strategy. As changes in the envi- organisations and society, leading today we found it most useful to proceed in ronment began to intensify (e.g., global to the emergence of Management by the opposite direction, which means competition, impact of technology, values (MBV). from MBV to MBO and finally to MBI. global economic crisis, etc.), MBO It really works well at the micro level. proved to be an insufficient strategy for Tool #1: Behaving Your Values In translating values into behaviour, managing in an interconnected and fast- or Translating values into one should dismantle the abstract value paced VUCA world. everyday behaviour identified in the (MBV) phase, into Values are an abstract concept. For us, concrete objectives (MBO) and finally In fact, organisations still relying on at the micro level, to be able to conduct into one or several contingent context MBO often discover that their managers our everyday life according to our specific behaviours (MBI). A best way fail to meet their objectives. Frustration values, require a methodology enabling to support this argument is to show an also increases when, despite their best to translate these abstract concepts into example. Here comes one: efforts, they are unable to determine concrete behaviours. For this translation what went wrong. Many times, it is David a manager in a software company, wanted to live his life by Figure 1: Dolan and colleagues’ description of the evolution of the value of “respect” (MBV). He management philosophy at the macro level should ask himself: what does it mean to live by this value? What are Trends for managers to become leaders, facilitators and the objectives (MBO – Managing corporate social responsibility agents by Objectives)? In this case, David dismantled the value of respect into CBV two objectives: To live my life in a way that (1) makes sure that the other Trends COMPLEXITY - MBV Trends feels worthy, and (2) sees and takes towards CHAOS towards into account the needs of the other. product XXI team work Now, each one of these objectives quality and MBO Century and flat needs to be further dismantled into structure everyday behaviours, answering the client 1960 - 2000 question: “What should I do in order orientation to meet these objectives?” As a true MBI 1920 - 1960 Trends for allowing knowledge workers more autonomy & empowerment Modified from Garcia & Dolan 1997 (in Spanish); Dolan, Garcia and Auerbach 2003; and, Dolan, Garcia and Richley 2016. Used with the permission of the authors. www.europeanbusinessreview.com 77

Management example, let’s use the case where David, Managing by Values generous to your brother. Each one of these had to give feedback to a colleague; thus he (MBV) aims to help us objectives needs to be further divided into consciously makes the effort to give the feed- create a set of values everyday behaviours. If one of the brothers, back in a way that ensures that the colleague that direct us towards Dan, has an important test, the parent should feels worthy and respectful after hearing the being more productive, encourage his brother to display an interest feedback. Another example is when David more ethical and, all and tell him: “Dan had an important test had to take a decision that affects his family. in all, more satisfied today, he is your brother, and he would be In that case, he considered the needs of his human being. very pleased if you display interest in him and family before taking the decision. Table 1 ask him how did the test go”. Table 2 provides depicts this example. a synthesis for this example. It’s important to note that there are many behaviours/instruc- Another example, is taken from our book tions that can meet one objective. When we “The parent as a value anchor”. It is showing how to write the behaviours/instructions (MBI), we translate the value “being a good brother”. write only some of them to demonstrate the way that one can meet this objective. If one of the values that the parent wants his/her child is to conduct himself by being Tool #2: The Value of the “Values’ Pie” a good brother (or the value of “good broth- Managing by Values (MBV) aims to help us erhood”), he/she should translate the value create a set of values that direct us towards into its objectives, or, in other words, into the being more productive, more ethical and, meaning of good brotherhood for him/her. all in all, more satisfied human being. These He/she can say that the meaning of “good three goals are also the three groups from brotherhood” means (1) protecting your which the set of the values should be formed. brother when he is being bullied, (2) showing Dolan 3Es Tri-axial model of ValuesTM as an interest in your brother, and (3) be described in Dolan, Garcia and Richley (2006) or Dolan (2011, 2019 and 2020) argues that MBV Table 1: Translating values to behaviours a full, balanced and healthy life needs to MBO through MBV-MBO-MBI – example #1 include three groups of values: the economic- pragmatic group, the ethical-social group and MBI Respect the emotional- developmental group. 1. The economic-pragmatic group deals with (1) Ensure that the other feels worthy. (2) Consider the needs of the other. values that direct behaviour in an effective manner which is instrumental in achieving • Provide feedback in a way that ensures that the our goals in life or at work. This group colleague feels worthy and respected. includes values such as excellence, planning, diligence, flexibility, efficiency, etc. This • Assess and consider the needs of my family before group of values encourage us to be produc- making the decision that affects them. tive people. The economic-pragmatic group is labeled as the red axis. MBV Table 2: Translating values into behaviours 2. The ethical-social group deals with rela- MBO through MBV-MBO-MBI – example #2 tionships, values that direct behaviour of MBI thoughtfulness, influence, loyalty, tolerance, Being a good brother or good brotherhood etc. This group of values encourage us to be ethical and social. The ethical-social group is (1) Protecting your brother when he is being bullied. labeled as the blue axis. (2) Taking interest in your brother. 3. The third group is the emotional- (3) Being generous to your brother. developmental group. Because of our pursuit of life, people often do not take this • When friends are bullying Dan, his big brother goes there value group into consideration. This group with his friends to stop the bulling immediately. • When Dan had an important test, to go ask him how the test went. 78 The European Business Review November - December 2019

deals with the orientation for a life filled with Figure 2: The Values’ Pie – example #1 in Family context interest, with passion, and with finding the path of life that will be good for a certain person. Values Family from this group will enable us to grow up as a • Giving the family priority fulfilled person. The emotional-developmental • Initiate family experiences group is labeled as the green axis. Respect The Values’ Pie integrates the Dolan “3Es Tri-axial model” and the Garti “behave your values • Makes sure that the other model” as has been described above and thus feels worthy creates a clearer picture of the way one wants to manage his/her life. The Values’ Pie, as we describe • Takes into account the hereafter, has four ingredients: (1) The correct needs of the other portion of each axis in one’s life. According to the Tri-axial model, if the pie contains all three axes, one Excellence Vitality can divide the whole (the 100%) in any way that • Experience things in its suits him/her. (2) Each slice of the pie contains • Be competent in full maximum richness the values of that axis. Each slice contains up to what you do 3 values, so that the total values in the pie will be • Make sure that • Initiate meaningful between three to five values. (3) The size of the whatever you do is experiences font of each value expresses the importance of in high standard of the value for the Values’ Pie owner. A value that quality and accuracy is written in a small font represent a relative less important value compared to a value that is written Figure 3: The Values’ Pie – example #2 in in a bigger font. (4) Each value has its objectives an organisational context (MBO), up to 5 objectives to each value. Significance Figure 2 is an example of David’s Values’ Pie. In • The employee will feel significant this example, the economic-pragmatic axis is 25% of to the organisation the pie, meaning, the pragmatic portion he wants in his life is 25%. The 75% left is divided equally by the • An employee who raises an idea will ethical-social axis and the emotional-developmental receive full attention axis. The economic-pragmatic axis contains one value – ‘excellence’, which is operationalised in two Integrity Modesty objectives: (1) Be competent in what you do, and (2) to make sure that whatever you do is in “high • Transparency in • Questioning out conclusions standard of quality and accuracy”. The ethical-social presenting conclusions • Openness axial contains two values, ‘family’ and ‘respect’. •Presentation will be • Willingness to cooperate Through the font you can notice that ‘family’ value accurate and comprehensive is more important to David than the ‘excellence’ value and the ‘respect’ value, both are smaller than Creativity the font of the ‘family’ value. The ‘family’ value contains two objectives (MBO): (1) Giving the • Enter new creative projects in the yearly work plan family priority, (2) Initiating family experiences. • Displays several solutions to issues that arise The ‘respect’ component includes: (1) Making sure that the other feels worthy, and (2) Considering the Professionalism needs of the other. The emotional-developmental axis has one value, ‘vitality’ with two objectives: (1) • Expertise in your job areas Experience things in its full maximum richness, • Work according to procedures and (2) Initiate meaningful experiences. The • Self - learning • Self - criticism ‘vitality’ value is as important as the ‘family’ value, as can be seen by its font size. As can be seen in Figure 2, the Values’ Pie gives a holistic view of the set of values – the axes distribu- tion, the values that are in each axis, their importance and their objectives. The pie reflects the way one wants to manage his/her life. Worth noting is that one should take a great deal of time and attention in exploring and building his/her Values’ Pie. Figure 3 is another example of a Values’ Pie. This example is of an organisation Values’ Pie context. www.europeanbusinessreview.com 79

Management Tool#3: The Value of the “Value Anchor” Figure 4: Value Anchor – example #1 A value is not a dichotomous phenomenon (having MBV – Planning It is not up or not having), but rather a phenomenon that runs to date in the on a continuum characterised by behavioural space. MBO - working according to the working-plan Using the anchor as a metaphor, behaving by values work plan means behaving in boundaries that the rope of the Start a task and but never anchor enables – not too firm and not too flexible. make sure later mind, it will For example, an honest person is not a person who has never lied, but a person that in his essence is that it is be OK honest and the times he has been dishonest are coordinated It is not up to very incidental and rare. Each person decides for with the work himself/herself what is the correct “length” of date in the his/her rope. When one’s rope is too long and it plan work plan, but I means that the behavioural space is too wide; and Do not start a coordinated with when a person behaves most of his time in spaces task before it the other managers far away from his/her anchor, then we will say is coordinated of the project that this person is dishonest. The anchor is desig- nated to secure a sea craft to a certain place in the with the ocean, without the vessel being carried away by work plan the wind, the waves, and the flow of the ocean or any additional factors. Similarly, the value anchor Figure 5: Value Anchor – example # 2 is designated to confine the person to a correct behavioural space, without him/her being carried MBV – Assistance Avoid away by inner (psychological needs) or outer helping (social pressure) determinants. MBO - Helping with the house chores whenever In his book “The (Honest) Truth about Dishonesty” Helping I can Ariely (2013), describes opposing forces which when I am motivate our behaviour. On the one hand, a asked to Helping person wants to think of himself as an honest and only if I respectable person and wants to feel good about Helping don’t have himself. On the other hand, a person wants to when I to sacrifice benefit from some circomstances7. Ariely elabo- see I can rates the concept of the flexibility of thoughts that help enables a person to cheat a little and still feel good about himself. The purpose of the value anchor is is “planning” (which is a pragmatic-economic to enable a person to follow his value system, even value); the objective for which they designed the if sometimes he must round corners, if it is not his space is “working according the working-plan”. In main course of action. the value space, they put uncompromising plan- ning behaviours/instructions close to the anchor, The value anchor space contains behaviours/ things like: “Do not start a task before it is coor- instructions (MBIs), of an objective (MBO), dinated with the work plan”. This is the expected and of a value (MBV). Figure 4 is an example behaviours/instructions from the team members. of a value anchor for developing a team. In A behaviour/instruction that is a bit further away, this example, the value the team agreed upon but still near the anchor, is for example “Start a task and make sure later that it is coordinated with Having a values’ pie and a value anchor for each objective in the pie, gives a full map of how a group should behave if they want to manage their group by these values. Leaders have a challenging task of helping their followers assimilating this values’ map. 80 The European Business Review November - December 2019

A value is not a dichotomous phenomenon matching your private vacations to the project (having or not having), but rather a schedule”. In this case the message is built phenomenon that runs on a continuum from the following blocks: characterised by behavioural space. MBI : Not to take a vacation a week before delivering the project. the work plan”. Further out is “It is not up to MBO : Match your vacations to the date in the work plan, but I coordinated with project schedule. the other managers of the project”. This is at MBV : Dedication the edge of the space; the anchor rope cannot An example from the family context can be get further away. Team members should not when your child asks not to go to a piano lesson, behave this way. Completely out of the value and instead wants to go see a friend who invited space, they put the behaviours/instructions him over. As depicted in Figure 6, instead of “It is not up to date in the work plan but never saying “no”, which does not convey an educational mind, it will be O.K”. They agreed that they message, and does not allow the generalisation of will never behave this way. the situation to other situations, we recommend Figure 5 is another example of a value anchor, conveying a message that has an educational value. this time in a family context. The value in this You may say, “The piano teacher is waiting for you. example is “assistance”, with the objective of It is disrespectful to let her know at the last minute “helping with the house chores”. The value is that you are not coming. This does not respect her part of the ethical-social axis. time.” In this case the value is “respect”, the objec- Having a values’ pie and a value anchor tive is “to respect the other person’s time” and for each objective in the pie, gives a full the behaviour is “not to cancel on a person at the map of how a group should behave if they last minute”. You may also say, “When you asked want to manage their group by these values. to have piano lessons, you took responsibility to Leaders have a challenging task of helping attend the classes and to practice between classes. their followers assimilating this values’ map. It I think you should respect this.” In this case the can be a parent educating his/her children to value is “responsibility”, the objective is “standing behave according to a values’ map they think is up to your commitments” and the behaviour is “to the right way to behave, or it can be a manager go to the lesson that I committed myself to”. helping his/her followers assimilating a values’ As leaders, messages are transferred via map they have agreed upon. It is important to everyday conduct. All day long leaders suggest, note that the values’ map should be designed together with the followers and not be Figure 6: Value Message – example imposed on them, however this is beyond the scope of this paper.8 Tool #4: The Value of the “Value Message” The piano teacher is waiting for you. It is disrespectful to let her know at the last minute that you are not coming. After designing the values’ map the leader must This does not respect her time. help the followers assimilate this map in their daily conduct. One effective tool is the value 1. MBI - Not to cancel on a person at the last minute message. The value message has the structure 2. MBO - To respect the other person’s time of MBI-MBO-MBV. An example can be when 3. MBV - Respect a worker tells his manager he wants to take a vacation in the end of the month. A value message can be “You cannot go on vacation a week before delivering the project. You are a team leader and you should show your dedication by www.europeanbusinessreview.com 81

Management Values are people’s motivators. For most people they are unconscious motivators. However, in a highly successful organisations, or healthy families, each member is aware of their personal values and how these relate to the organisation/family value system. pay compliments, ask their followers for things. with it and communicate with us if you obtain If they succeed, to build their messages in a satisfactory results. MBI-MBO-MBV structure – to add to the behaviour, the objective and the value, these About the Authors things will be internalised, and the follower will Dr. Anat Garti is a social psycholo- be able to generalise and to understand how he gist, couple and family therapist, should behave in other situations. management consultant, and a coach. She is the chief psycholo- Conclusion gist of the Israel Values Center: Values are people’s motivators. For most people they are unconscious motivators. However, in a www. values-center.co.il. Contact her: anat- highly successful organisations, or healthy fami- [email protected] lies, each member is aware of their personal values and how these relate to the organisation/ Dr. Simon L. Dolan is a researcher, family value system. In this case, values are author, management consultant and conscious motivators because there is congruence executive coach. A prolific author between the individual and the organisation/ (over 74 books), the creator of the family. Managing by values provides an effective Leading, Managing and Coaching way for managers and for parents to tap into a by Values school of thought. Recently he has genuine source of motivation. created the Global Future of Work Foundation. He commutes between Barcelona (Spain) and The managing by values (MBV) model which Montreal (Canada). Visit his web site at www. renders operational the four complementary simondolan.com and contact him: info@ tools described in this paper invite every person simondolan.com and group to carefully explore what is important to them in life/organisation/family, how they References wish to manage their life/organisation/family 1. Liran, A., & Dolan, S. (2016). Values, Values on the wall, Just do busi- and to live and lead that way. It produces quasi ness and forget them all: Wells Fargo, Volkswagen and others in the Hall. miracles and outstanding results not only at the The European Business Review. October; and, Liran A., Dolan S.L., (2017) macro level (organisation), but also at the micro United Airlines, Artificial Intelligence, and Donald Trump: Reawakening individual level. We invite you to experiment Values in the Era of Fake Service, Fake Reality, and Fake News, The European Business Review June 2. Dolan S., Garcia S., and Richley (2006) B., Managing by values: A Guide to Living, Being Alive, and Making a Living in the XXI Century. Palgrave- MacMillan, London (U.K); and Dolan S.L., (2011). Coaching by Values: A Guide to Success in the Life of Business and the Business of Life. iUniverse. Bloomington, IND. Dolan, S.L., (2019) Más coaching por valores. Madrid, LID editorial. Dolan S.L., (2020) The secret of Coaching and Leading by Values: How to ensure allignment and proper realignment. Routledge. (Forthcoming) 3. Garti, A and Dolan S. L. (2016). The parent as a value anchor. Gestion M.D.S. Inc. 4. Dolan S.L. (2019) Más coaching por valores, Madrid, LID editorial 5. Garcia S., Dolan (1997) La dirección por valores. Madrid McGraw Hill; Dolan S.L. Garcia S., Auerbach A., (2003) “Understanding and Managing Chaos in Organizations”, Intrnational Journal of Management, Vol 20(1):23-35; Dolan, S.L. Garcia S., Richley B., (2006) Managing by Values: A corporate guide to living, being alive and making a living in the 21st century. Palgrave Macmillan 6. Dolan S.L. (2016) Reflections on Leadership, Coaching and values: A framework for understanding the consequences of value congruence and incongruence in organizations and a call to enhance value alignment, The Study of Organizations and Human Resource Management Quarterly, July, Vol 2(1):56-74; Dolan S.L. (2019) Más coaching por valores , Madrid LID editorial. The English version of the book will be available in the Fall of 2019. 7. Ariely D., (2013). The (Honest) Truth about Dishonesty. Harper Perennial; Reprint edition (June 18, 2013) 8. If you wish to read more about Leadership by values , we recommend www.leadershipbyvalues.com or read Dolan (2018) Liderazgo, direccion y coaching por valores, Punto Rojo (Amazon.com) or see the forthcoming book in English: Dolan S.L. (2020) The secret of Coaching and Leading by Values: How to ensure alignmenmt and proper realignment. Routledge (forthcoming). 82 The European Business Review November - December 2019

Leadership SOFT LEADERSHIP FOR MILLENNIALS The purpose of this article is to the other hand, the generation which interprets as Generation Y, Generation Me, explore soft leadership to meet the these writings will be an educated generation; Nexters, Baby Boom Echo Generation, rising expectations of the millennials they will understand me and say: ‘Not all were Echo Boomers, Digital Natives, and globally. It unfolds the attitudes and asleep in the nighttime of our grandparents’.” Generation Next. They are the demo- actions of millennials who are often graphic cohort following Generation misunderstood globally for their – Jose Rizal X. They are ambitious, smart, brilliant personality and behavior. It debunks Introduction and technologically savvy. They belong myths about millennials with truths. Globally the population of the millen- to a different school of thought, unlike It underscores their challenges and nials is growing rapidly. A study shows older generations. Their mindset is expectations, and compares and that by 2020, millennials will be approxi- unique, the toolset is rapid, and skill contrasts with other generations. It mately 50 percent of the U.S. workforce, set is advanced. Precisely, they are a offers tools and techniques to inspire and by 2030, 75 percent of the global different breed. They bring unique and engage millennials globally, workforce. It throws challenges and ideas and insights irrespective of the and explains the role of CEOs and opportunities for organisations globally. industry and area they enter into. They leaders to bridge the generational The opportunities outnumber the chal- are often criticised as impatient and are differences. It concludes to cele- lenges because millennials are responsible overambitious to make money. They are brate the generational differences and committed to advance their profes- also criticised for being indifferent with to achieve organisational excellence sional careers. They have an open mind the older generations in the workplace. and effectiveness. to learn and grow and add value to their organisations and society as a whole. Research Findings on Millennials “I do not write for this generation. I am writing Millennials1 matter because they are not for other ages. If this could read me, they would Who are Millennials? only different from those that have gone burn my books, the work of my whole life. On Millennials are the people born between before, they are also more numerous 1980 and 2000. They are also known www.europeanbusinessreview.com 83

Leadership than any since the soon-to-retire Baby Boomer generation – tures. They don’t hesitate to correct irregularities. That millennials already form 25% of the workforce in the US and doesn’t mean that they are rebellious. They are unconven- account for over half of the population in India. By 2020, tional with their unique ideas and insights. Hence, it might millennials will form 50% of the global workforce. appear that they are rebels for older generations. • Myth #5: Millennials are rights-oriented, not A study2 unfolds that millennials want a flexible approach to work, but very regular feedback and encouragement. They duty-oriented. want to feel their work is worthwhile and that their efforts are being recognised. And they value similar things in an Truth: Millennials’ attitudes and actions often demon- employer brand as they do in a consumer brand. strate that they are more rights-oriented. The truth is that they are committed and responsible. They don't want to With immigration adding more numbers to its group become a burden to their parents. They want to live inde- than any other, the Millennial population3 is projected to pendently with freedom and dignity. At the workplace, peak in 2036 at 81.1 million. Thereafter the oldest Millennial they like to be treated fairly and ethically. They are very will be at least 56 years of age and mortality is projected to much aware that they can claim their rights only when outweigh net immigration. By 2050 there will be a projected they deliver their duties sincerely. 79.2 million Millennials. • Myth #6: Millennials are immature with a Myths and Truths about Millennials wavering mind. “Millennials are often portrayed as apathetic, disinterested, tuned out and selfish. None of those adjectives describe the Millennials I've been Truth: Millennials are very much mature with a clear privileged to meet and work with.” – Chelsea Clinton focus on their goals and objectives. They focus only on a few areas and work on them smartly. They are more There are several myths associated with millennials glob- mature and much smarter than their previous generations. ally. Here are some myths and truths about them: • Myth #7: Millennials have low commitment levels. • Myth #1: Millennials are selfish. Truth: Millennials are highly committed to their causes. Truth: The truth is that millennials are engaged with their They focus on a few causes and work on them rather than professional advancement. But they are equally keen to spread their wings in all areas. They are narrowly focused serve others through nonprofits. but highly committed. • Myth #2: Millennials are after money and power. • Myth #8: Millennials are risk-averse. Truth: The older generation traded their happiness and passion for a big fat paycheck. However, the millennials Truth: Millennials are willing to take risks and experi- are willing to settle with smaller paychecks. They are after ment. They want to go by the road less traveled to stand career advancement and growth. They search for meaning out from others. than money. Hence, they emphasise work-life balance. • Myth #9: Millennials are disrespectful toward others. • Myth #3: Millennials are lazy. Truth: Millennials are misunderstood as lazy. They Truth: Millennials believe in the slogan of ‘give respect believe more in smart work than in hard work, unlike and take respect.’ They want more freedom and think other generations. independently. At times Gen X and Baby Boomers feel • Myth #4: Millennials have a rebellious attitude. that they are not respected by millennials. Truth: Millennials fight against wrong systems and struc- • Myth #10:Millennials are competitive by nature. Truth: The truth is that millennials are cooperative, and collaborate with others, unlike earlier generations who emphasised competition. • Myth #11: Millennials lack loyalty. Millennials want a flexible approach to work, but very regular feedback and encouragement. They want to feel their work is worthwhile and that their efforts are being recognised. And they value similar things in an employer brand as they do in a consumer brand. 84 The European Business Review November - December 2019 1. https://www.pwc.com/m1/en/services/consulting/documents/millennials-at-work.pdf

Truth: Millennials are loyal to their industries Millennials are individuals, average people talk about issues, and areas rather than to their organisations. willing to settle and above average people talk about ideas. They job hop. They strongly believe that there is Most millennials fall in the bracket of above no permanent employment but only permanent with smaller average people. employability in the world. paychecks. They • Myth #12: Millennials are difficult to manage. are after career Millennials are the most technologically savvy advancement and educated generation to enter the workforce. Truth: It is easy to manage and lead millen- and growth. They They are responsible and committed. They have nials provided the leaders and older generations search for meaning short-term goals and expect quick outcomes. They understand and appreciate their expectations want to have more privacy and freedom. They want and aspirations. The leaders must apply different than money. to take career breaks to go on sabbatical. They live strokes for millennials, as the conventional lead- for today, not tomorrow. They believe in the philos- ership styles may not work. ophy of YOLO – You Only Live Once. They are • Myth #13: Millennials want to become bosses. risk takers and experiment with new things. They are choosy about their careers and the nature of Truth: Millennials are keen to upgrade their work. They love to work with freedom, accept knowledge, skills, and abilities regularly. They challenging roles and responsibilities, and exper- want to become partners for progress than to iment with new tasks. They like to work with become bosses and leaders. leaders who are transparent, ethical and fair. • Myth #14: Millennials are part of the problem, They prefer working with leaders who are hard- working, competent, determined, and accountable not the solution for their actions. They want to work in flat and lean organisations. They accept the tasks that give Truth: Majority of the millennials are willing to them a sense of purpose and direction to provide resolve the issues. They are part of the solution, meaning to their professional lives. They want to not the problem. They explore ways and means learn, unlearn and relearn. They want to excel as to resolve vexing issues rather than brooding knowledge experts and leaders in their domains over them. They don’t blame the circumstances and industries. They are highly ambitious and and the people around them. They take respon- aspire to make a difference to society. They are sibility and are troubleshooters. It is rightly keen to build their leadership brand and share their said that the below average people talk about leadership philosophy. Expectations of Millennials “They (Millennials) are more free-spirited. They enjoy outdoor recreation, the environment and are health-oriented. It’s about being able to communicate what we have to resonate with them. Hopefully, speak to them in their language as opposed to the language of the past.” – Jan Rogers, former SIEDO director Millennials must be valued for their work and contribution. They enjoy working in a challenging work environment to widen their experience and increase their skills, abilities, and knowledge. They prefer non-financial incentives to financial incen- tives including job rotation, job enrichment and flexible working hours. They are keen to travel the globe on work assignments. They appreciate overseas assignments in their early careers. They 2. https://www.pwc.com/m1/en/services/consulting/documents/millennials-at-work.pdf www.europeanbusinessreview.com 85 3. http://www.pewresearch.org/fact-tank/2016/04/25/millennials-overtake-baby-boomers/

Leadership enjoy working in a good organisational early careers as most of them are find out ways and means to lead millen- environment with friendly colleagues. keen to travel globally. nials as their attitudes and expectations They prefer to work in teams and • Provide honest feedback. are different. They must foresee that collaborate with others. They want to • Encourage learning and develop- millennials will dominate the global work- work with mentors and coaches who ment to update their knowledge, force, and are on the prowl to take on can guide and groom them as leaders. skills, and abilities. other generations. At times older gener- They want quick career progression to • Build a corporate lattice, not a corpo- ations feel insecure about the ability, reach senior leadership positions. They rate ladder. Traditional corporate capability, and adaptability of millennials. must feel that their workplace is their ladder is to climb up step by step Of course, it is not a new phenomenon second home. whereas corporate lattice is to climb as there is always a divide between various the career in different networks that generations. However, the gap between Globally millennials are unbelievably need not to be vertical always. millennials and other generations is diverse in their opinions and actions. wide due to the rapid growth in tech- The research findings of their attitudes The Role of CEOs to Bridge the nology resulting in different value and and actions vary from nation to nation. Generational Differences core system. There are conflicts between Hence, it is ideal to gauge their aspira- Millennials emphasise more on ends, generations due to ego and value system. tions regionally and nationally to cater not means. They look for outcomes, not Hence, CEOs and senior leaders must to their needs. actions. How you achieve the success take a serious note of the prevailing chal- doesn’t matter to them. What matters lenges to bridge the generational gap. Tools and Techniques to Inspire and to them is achieving success at any Engage Millennials Effectively cost. This attitude and approach are not Soft Leadership for Millennials Here are some tools and techniques to appreciated by the older generations “We are taught to think that if something has inspire and engage millennials in the resulting in conflicts in values and ethics. been a certain way for very long, there’s a possi- workplace to achieve better produc- bility that it’s no longer good enough.” tivity and performance: The CEOs and senior leaders must • Understand their psychology, aspira- – Caleb Melby Millennials emphasise tions, and expectations. more on ends, not means. Currently, a few millennials manage • Give them the freedom to explore They look for outcomes, earlier generations in some global organ- not actions. How you isations. At times, there are conflicts and experiment. achieve the success between these generations. Hence, it is • Offer challenging assignments. doesn’t matter to them. essential to manage these generations • Avoid micromanagement. with empathy and communication. It • Provide flexible working hours. calls for a different leadership style that • Rotate them on the job. can bridge the generational differences. • Offer global assignments in their Leadership is the passion to teach others with experience and the ability to offer guidance to achieve organisa- tional goals and objectives. It is essential for the leaders to evolve new leadership style as the technology and culture are changing globally. According to Psychology Today, millennials are more genuine. They thrive on being judged by their perfor- mance, and they respect those with experience rather than power. They prefer “inclusive” leadership styles – bosses that appreciate them for their hard work (no brown-nosing needed). 86 The European Business Review November - December 2019

There are strengths and weaknesses associated and expertise of the older generations by bringing synergy in the workplace. with each generation. Just because of a few There are several millennials including Mark weaknesses, we cannot brand a specific generation Zuckerberg, Jennifer Lawrence, and Jenna Marbles succeeded in their lives. And their success rate is as bad; and just because of a few strengths, we growing globally because they go by the road less traveled. They also admire several leaders irrespec- cannot brand a specific generation as good. tive of generations – Mahatma Gandhi, Nelson Mandela, Barack Obama, Warren Buffett, Bill Gates, Hence, millennials are craving for a leadership Richard Branson, Steve Jobs, and Elon Musk. style that suits their attitudes and expectations. They want to add value to their CVs than to their To summarise, there are strengths and weaknesses organisations. They want to work for themselves associated with each generation. Just because of a than for others. They want to become employers few weaknesses, we cannot brand a specific gener- than employees. They appreciate ethical, open, ation as bad; and just because of a few strengths, transparent, transformational, and inclusive lead- we cannot brand a specific generation as good. To ership style. Since soft leadership shells out such conclude, let us celebrate the generational differ- aspects, it will suit their attitudes and actions. ences as these differences lead to innovation to beat We can explore soft leadership which believes the competition. It ultimately leads to organisational in partnership rather than in the leader-follower excellence and effectiveness. relationship. Additionally, millennials understand the importance of soft skills over hard skills “There is no envy, jealousy, or hatred between the different to grow as successful leaders. They appreciate colors of the rainbow. And no fear either. Because each one transformational and democratic leadership over exists to make the others’ love more beautiful.” autocratic leadership. They want to be part of the decision-making process. Hence, soft leadership – Aberjhani which is a relationship leadership suits their atti- tudes and expectations. Note: This article is an adapted excerpt from my book, “Soft Leadership: A New Direction to Leadership” Conclusion “Compared to other generations, millennials tend to be more About the Author collaborative, are accustomed to working in teams & have a Professor M.S. Rao, Ph.D. is the father passion for pressure.” of “Soft Leadership” and founder of MSR Leadership Consultants, India. He is – Joanie Connell, Flying Without a Helicopter: an International Leadership Guru with 38 How to Prepare Young People for Work and Life years of experience and the author of over It is a fact that people cannot be different alto- 45 books including the award-winning ‘21 Success Sutras gether just because they are born in specific years. for CEOs’.1 Most of his work is available free of charge When these people get older they may show more on his four blogs including http://professormsraovi- or less similar traits like the older generations. For sion2030.blogspot.com. He is also a dynamic, energetic, instance, millennials show some qualities which and inspirational leadership speaker. may have been shown by other generations when they were young. Only thing is that technology, References education, and environment have brought some • https://www.pwc.com/m1/en/services/consulting/documents/ changes resulting in different attitudes and actions in millennials. millennials-at-work.pdf • http://www.forbes.com/sites/jeannemeister/2012/10/05/ It is rightly remarked, “A new broom sweeps better. But an old broom knows all the corners.” millennialmindse/ Hence, millennials must respect the experience • http://www.pewresearch.org/fact-tank/2016/04/25/ millennials-overtake-baby-boomers/ • http://www.pz.harvard.edu/sites/default/files/gardner%20 mind,%20work,%20and%20life.pdf • https://www.psychologytoday.com/blog/wired- success/201403/ how - the - millennia l - generation - will - change - the - workplace • https://hbr.org/2004/01/what-makes-a-leader www.europeanbusinessreview.com 87

Diversity Changing the Face of Finance and Professional Services BY LUCY FRANKLIN Stereotyping is not inherently bad, but it is That said, it’s the associations that people make undoubtedly restricting. Most especially in the between finance and suits that I want to chal- industry of finance and professional service lenge, and the idea that you can summarise a where such limitations can be detrimental to whole industry in a simple trope. one’s career. In this article, the author highlights the importance of shifting from a perspective of The concept of ‘suits’ is often a negative one. general categorisation to embracing – as well as There are bars in London that don’t allow people protecting – diversity in the industry. wearing a suit in! There’s a popular connotation between suits and men of a certain age, certain Some sectors have a popular stereotype ethnicity, and certain class. This is obviously attached to them. We identify tech start-ups absurdly simplistic and far from the truth, given with bright young millennial things. We almost that plenty of men (and women) of different back- certainly all have the same image in our minds when grounds may wear suits for a range of reasons. But someone mentions a banker. And when it comes beyond that, those who wear suits and conform to finance and professional services – we probably to certain backgrounds and cultures offer a huge think of people in blue suits. amount to my sector. There are reams of talented, dedicated men of a certain age in the financial and Stereotypes are hard to shift. They are not neces- professional services industry, doing committed sarily negative – but often they don’t reflect the and excellent work. Sometimes, they might wear full picture, seizing instead only an aspect of the suits while they do it. reality. For example, there are lots of millennials in start-ups, but there are also lots of people with But as much as they contribute, they are only part decades of career experience. Similarly, there are of the story. There are also many women, people of a lot of people in blue suits in finance and profes- different nationalities, young people, people at the sional services – but that isn’t the whole story. ends of their careers, people in the middle, people just starting out. My 120-strong team at Accordance Firstly, I want to point out that there’s nothing speaks more than 30 different languages. We have wrong with a suit – I defend dressing appropriately people from right across Europe, our average age when required, and I know from personal experi- is 32 and though our outlook and culture is liberal, ence how differently (rightly or wrongly) people we’re happy to be home to people of a range of treat you when you’re dressed ‘professionally’. different political views. Stereotypes are hard to shift. They are We have to move away from this simple categorisa- not necessarily negative – but often tion, no matter how tempting it is to fall into. Although they don’t reflect the full picture, seizing Accordance bucks some industry trends, finance and instead only an aspect of the reality. professional services in a general is a broad, diverse church – and that’s cause for celebration. Being proud of diversity doesn’t mean denigrating what was previ- ously the norm – all those who made and continue 88 The European Business Review November - December 2019

to develop this sector are integral to it. But as times Diversity also place a series of measures to support staff, from change, as societies change and as life changes, we needs to be employment and immigration lawyers to provide must embrace – and encourage the outside world to protected. We are legal advice and guidance, to Brexit briefings to embrace – the full breadth of who we really are. living through decode the Westminster chaos in a way people can troubled political understand. I personally, have also marched on As the female head of a company in a sector still times. For non-UK two ‘people’s vote’ campaigns, and intend to do so dominated by men at the upper echelons, I feel this nationals in the again on the 19th in the interest of diversity! very keenly. Making the industry more diverse at UK workforce, senior levels depends on a multiplicity of factors, this is a period of But this still isn’t enough. Simply put, I believe we and raising our voices about who is operating in the great uncertainty. should stay in the EU, and I believe my workers and industry and making it succeed is a crucial part of the EU nationals living in the UK have a right to live, evening the scales in the long term. As well as this, work and reside here as long as they choose without diversity brings benefits and richness in terms of atti- uncertainty about their positions and xenophobia in tudes, management styles, and beliefs. It’s not about the discourse around them. Finance and professional surface changes either – greater diversity is better for services is just one of many sectors that couldn’t exist bottom lines, and adds value to the UK economy. without the work of our foreign national colleagues. That’s why over the last year I’ve put my head above Diversity also needs to be protected. We are the parapet and made my position on Brexit as an living through troubled political times. For non-UK individual and as Managing Director clear. It’s a way nationals in the UK workforce, this is a period of of advocating on behalf of my workers and it’s a way great uncertainty. National policy is extremely hostile of demonstrating my commitment to diversity. I want to those without passport rights. Barely a week goes our EU friends and colleagues to keep on contributing by without news of another person who has made to Accordance and other businesses in the sector – and the UK their home being told to leave arbitrarily. I want to show them how much they are valued. On top of this, Brexit is looming and has cast a great shadow of doubt over the future of European For me, working to change the face of the sector I nationals in the UK. At Accordance, more than 60% work in is about lifting the curtain on what it is really of our staff are European. The last three years has like, and showing its truth. It’s also about advocating left many feeling unsettled and undervalued. Some in favour of diversity. Fundamentally, we have to people have even decided to leave for reasons that keep diversity on the forefront of people’s minds are nothing do with Accordance, but simply because as an issue. In industries which lack diversity at the they want to feel ‘at home in Europe’ again. The top, we have to keep reminding who is driving things challenges that this poses to us as employers but first forward and why they must be more represented. and foremost as people, is immense. We’ve put in At Accordance we welcome people of all walks of life and persuasions. Our UK, EU and world- wide colleagues are what makes us – and whether they come to work in a suit or not they will be forever welcome. About the Author Lucy Franklin was appointed MD of Accordance at the beginning of 2019. She has a vision for Accordance which puts people at its heart – to harness its experts at every level of the business, enabling people to reach their potential, and facilitating busi- ness growth through their empowerment. With two decades of managerial experience, her strategic thinking and knowledge of the developing VAT landscape ensures that Accordance can drive greater trade, harmony and understanding across Europe. www.europeanbusinessreview.com 89

Innovation SIX LESSONS I LEARNED ABOUT INNOVATION BY TERRENCE HAHN In today’s society, it is hard to conceptualise In my 30-year career championing and deliv- innovation without the context of technology. ering growth in industrial companies around the It is imperative to understand the technological world, I have been fortunate to have led teams shift that can impact one’s managerial strategy that have successfully competed at the cutting greatly. In this article, the author highlights key edge of innovation. For me, consistently deliv- lessons regarding innovation that centre on time, ering double-digit income growth across eight risk taking, identification of innovators, value different industries in six different countries propositions, customer-centric approach, and and managing workforces as large as 40,000 and alignment of internal teams. annual budgets that topped $10 billion would not have been possible without generating organisa- Much of today’s conversation about innova- tional passion about innovation. While working tion is captivated by new technology – and for Air Products (APD), an international indus- with good reason: technology is respon- trial gases and chemicals company, and later sible for many of the step-change transformations Honeywell (HON), I oversaw teams that made that have taken place in business in recent years. remarkable achievements – like the development Across industries, it is necessary for leaders to stay of new-to-world molecules for improved environ- contemporary with emerging technologies and also mental performance, and clean fuel technologies to deploy them appropriately across their organisa- that help to make the world a safer, better place tions and end markets. to live, just to name a few. Yet, as important as it is for executives to stay Across industries, it is necessary for leaders to current with relevant technological advancements, stay contemporary with emerging technologies it is equally as important for us to remember that and also to deploy them appropriately across those advancements do not occur in a vacuum: in their organizations and end markets. any sector, the speed with which companies develop and deploy new technologies will be a key determi- nant in the success of their innovation efforts. 90 The European Business Review November - December 2019

Amidst all of this progress, I have areas has allowed me to create solid Honeywell’s AlliedSignal business in also seen companies struggle to main- foundations on which innovative 2007, after spending 19 years at Air tain their competitive edge because they new offerings could be built. That Products and Chemicals, Inc. The were unable to innovate more rapidly is, sticking to the rule of three can AlliedSignal division at Honeywell was than their peers. Though some leaders help leaders identify pre-existing focused on aerosols, solvent agents, talk about their commitment to innova- problems within their businesses and blowing agents, and refrigerants and, tion, executing on that vision requires a prevent other issues from cropping for many at the organisation, had distinctive set of skills that ultimately can up. Spending more than one-third seemingly little prospects for growth. be mastered by every business leader. of the time on the core business, for example, could indicate deficiencies At the time, external events like the Experience has taught me that in either strategy or the organisation’s Montreal and Kyoto Protocols were establishing a robust operating system operating system. bringing a number of products to an for how organisations work efficiently end, and the business’s single-digit ROI together allows leaders to build agile On the other hand, neglecting to was less than encouraging. Though the teams that are ready and motivated to make time for matters related to talent majority of the team was not convinced drive growth through innovation. In and culture could hinder leaders’ abil- that there was room to advance the particular, I have found that facilitating ities to find the right people to fill key business, I did, however, find a critical innovation in any industry depends positions or ensure that employees few who were willing to innovate. upon six critical inputs, centered around have the guidance they need to be time, risk, talent, value proposition, successful. Ideally, organisations will While digging in, I was deter- customer-centric thinking, and aligning attract and retain individuals who are mined to find a way for my team to internal teams around innovation. versatile enough to step out of their leverage their domain knowledge of regular roles to drive the process of our end markets to create new, even Time: give innovation an equal share innovation. Strength in these areas – more efficient and environmentally It’s no secret that dedicating time to core business and talent – underlies compliant offerings. Ultimately, these innovation work can yield tremen- opportunities for growth and allows new products were supported by dous results. During my tenure leading executives to devote an equal amount installing a more effective operating Honeywell’s AlliedSignal business, for of time to innovation itself. system and using the ensuing business instance, my team transformed our performance enhancements to fund single-digit margins to 20+ percent Adhering to the rule of three our innovation work. I spent time margins by re-inventing our portfolio helped me to recognise that my team’s on building an operating system that through innovation initiatives. cross-functional engagement could allowed my team to improve our base be optimised when I first arrived at business to generate to the resources As that experience shows, there required for growth. This created are great rewards to be reaped from I have found that executives’ significant investment opportunities making innovation a focal point. time is best allocated that were greater than 20 percent ROI. In practice, however, it can be chal- according to a rule of In parallel, we were able to support our lenging for executives to actually give research and development efforts by innovation the attention it deserves. three, giving one-third of driving engagement with customers, Though there can be myriad reasons working hours to each of regulators who needed to confirm the for this, the problem often boils the following: core business, legislative environment, and NGOs down to the question of how exec- talent and culture building, that provided social approval on the utives choose to divide their time. and growth and innovation. new offerings. I have found that executives’ time In the end, the efficiencies of the is best allocated according to a rule new operating system helped us invest of three, giving one-third of working time and resources into fruitful innova- hours to each of the following: tions: we developed three new-to-world core business, talent and culture molecules over the course of two-and- building, and growth and innovation. a-half years, and the business achieved 20+ percent margins and a 20+ percent In my career, carving out time to income growth rate. focus on the first two of these three www.europeanbusinessreview.com 91

Innovation Encourage risk taking, but focus on Different members of out innovators within the organisation and moving the needle a team have different creating an environment where those innova- When I was promoted to Managing Director of strengths, but the truth tors can flourish. Since the skills that innovation oneof APD’skeyjointventuresinthemid-1990s, is, innovators are a rare work requires are often not the same as those the business seemed to have a bright future: breed. Finding these used in the typical day-to-day activities of the the Malaysia-based industrial gases division business, it is important to encourage innova- had been benefitting from an economic boom individuals – those tion teams to share and develop their own ideas that was affecting the larger geographic region, who have an insatiable through active experimentation. and new orders were constantly pouring in. curiosity and drive to Part of embracing this type of risk taking also After six months on the job, however, that learn – is half of the means giving employees room to fail. In the long once-promising business environment quickly battle when it comes run, the results – however negative – from a trial turned bleak as the Southeast Asian financial that fails fast in the span of a few weeks are more crisis hit, ravaging the Malaysian market. to talent. valuable than one that never gets tested at all because managers spent months waffling over Though the economic situation in the region Cryogenic Freezing the concept. Even so, there’s an art to failure, created a climate of uncertainty, my team and Innovation and it lies in structuring the discovery and devel- I determined that maintaining our commitment opment process around evaluation and learning. to product development – in spite of all of the risks that process would entail – was the best At the outset, the team involved in testing a way for us to not just survive, but also thrive new offering should define their goals for the during the crisis. work. Then, I find, setting milestones and identi- fying “needle movers” – items that have financial At that moment, deciding to take the risks impact on the business – become crucial next that come with pursuing innovation was not steps. This type of planning allows innovators easy – and doing so rarely is. In business, and in to explore new territory while providing bench- society more broadly, it’s not difficult to fall into a marks that enable them to track their progress, pattern of risk-averse behavior. This is especially so that the risk taking does not get out of hand; true at large organisations, where proposals for it also requires collecting data, which can be saved new product developments may be submitted and mined for insights later on, even if the initial to bureaucratic approval processes that often do project doesn’t produce the desired results. little more than maintain the status quo. Deploying this approach in our innovation While there’s no doubt that the risks asso- work at APD helped us to continually learn ciated with research and development should from each new trial. As an additional tactic for be carefully considered, in the end, innovation reducing the risks associated with our devel- doesn’t happen without them. That’s why any opment initiatives, we directed efforts toward business – be it a huge multi-national corpora- expanding our understanding of how our tion or a small startup – can benefit from seeking customers used our products. Based on this knowledge, we dedicated time to helping our customers understand the value proposition of the products that we were creating, which drove demand for the new offerings. For instance, we developed local cryogenic freezing capabilities that food producers could use to ultimately sell their products at a higher price point. One such use case related to the process of producing spices; by cryogenically freezing the product, the spices would retain their oils – which contain the flavors – when ground, increasing the end product’s value. Another application of the cryogenic 92 The European Business Review November - December 2019

I always ask development teams to write the one-page letter our customer would send to their chairman to receive approval for the product. This has pushed my teams to think about the proposition in both technical and economic terms and to ask important questions, such as what is known, believed, and assumed about the proposed product. freezing capability we developed was the preservation of I learned the value of managing talent within the inno- shrimp. Shrimp farmers give oxygen to shrimp to make them vation process firsthand during my time as President & grow larger, which increases the price as sold by the pound; CEO of Honeywell Home and Building Technologies. we drove demand for our cryogenic freezing technology Before I started in that role, the business had acquired by explaining to customers that this method of preserva- thirteen companies that were run independently. In the tion locked in more moisture, resulting in higher value for past, this siloed system of operation had worked because both our customer and their end consumers. In the end, our software was developed to use in on-premise systems. customers were able to advance price increases based on the By the time I arrived, however, the industry was shifting value generated. toward an edge-cloud-mobility platform. By thinking creatively about communicating the value To develop and make the transition to this new platform, proposition of our product to customers, our team was able I led the integration of the thirteen acquired companies, to successfully take innovative products to market, justifying which served as a great boon to the development process: the risks of the research and development process. the companies that had historically been separate entities could now combine their talent to develop a platform that Identify innovators and be their champion would be broadly applicable and customisable. We worked Returning for a moment to that idea of the time-consuming, to identify individuals who could step out of their existing bureaucratic processes that can thwart new developments roles to lead our innovation initiatives and funded them brings me to another one of innovation’s most vital inputs: to their next milestones. This allowed us to evaluate the people. Different members of a team have different strengths, process of innovation as it continued on. but the truth is, innovators are a rare breed. Finding these individuals – those who have an insatiable curiosity and Another key learning from this experience was the drive to learn – is half of the battle when it comes to talent. importance of knowing how to respect the legacy of a busi- The rest lies in making sure that those would-be innovators ness while guiding it through major organisational shifts. receive the support they need to do their best work, which in Though it no longer made sense for each of the previ- turn will help the organisation on its journey toward growth. ously acquired companies to operate separately, we never lost sight of the fact that the people who worked in those To be positioned for success, innovators should be businesses possessed deep expertise and domain knowl- celebrated and sponsored. Supporting these individuals’ edge that would be valuable to us throughout the change inquiries from the top will signal that efforts toward inno- management process. vation are valued, and that failure – which innovators need in order to learn – is not the end of the world. Setting this By pooling our talent, we drove the innovation process tone will help to align the organisation around supporting to create new technology that could give our customers innovation and will help managers feel more at ease with greater intelligence about the buildings and spaces they own the inevitable ups and downs of the development process. and occupy. Instead of just including lighting, heating, and other utlities, our newly developed systems could collect data What’s more, it’s important to place innovators in mana- around operations like building occupancy and space manage- gerial roles with authority. I believe that it is most effective to ment to yield enhanced insights about the ways people used put leadership over development teams in the hands of the and interacted with spaces and structures. innovators themselves, and that these leaders should report directly to executives on those “needle moving” milestones. Define value propositions from the beginning Offering innovators empowerment and ownership over the In my experience, obtaining buy-in from internal teams and process cultivates a culture that is conducive to advancement external stakeholders can present a significant hurdle to on all fronts. This may mean that you, as the executive, have getting innovation efforts underway. During my tenure as more to do, but the results from the team are worth it. CEO of Honeywell Transportation Systems, for instance, I www.europeanbusinessreview.com 93

Innovation found that my proposals for increasing This exercise may sound simple, innovations will prove valuable to our innovation work were initially met but if that draft letter does not customers at the end of the process. with some resistance. hold water, neither will the develop- That’s why I have long been a propo- ment project – and no amount of nent of bringing customers into When I arrived, Honeywell was the PowerPoint slides can fix that. research and development efforts early leading supplier of turbochargers to on. Living with the customer – by the diesel auto industry, which was a Once the value proposition was set, embedding your team in their oper- very profitable business at the time we took note of what details needed to ations and studying their approach (between 2013 and 2016). Many at the shift from the “believed” or “assumed” – can reveal unmet and undefined organisation feared that developing categories to the “known” category. needs in the sector. Working on-site new products would dilute the high These help to point out what I like to with customers as innovation partners, margins that had been achieved until call “needle movers” for the project I find, is faster and yields more insights then, in spite of that fact that signifi- – items that have financial impact on than does bringing customers into your cant growth was available in gasoline, the business. Selecting these “needle company’s “development island” – not electric, hybrid, and software. movers” will catalyse the early stages of least because it gives teams the oppor- rapid experimentation and risk elimina- tunity to speak with multiple people How, then, did my team overcome this tion or value confirmation. from the customer’s organisation and obstacle? We turned our focus to articu- receive instant feedback. lating a clear value proposition from the In the end, by allowing research start of each new project – a strong prac- and thinking about value proposition Such was the case when I was working tice for initiating any development work. to guide our innovation agenda, my in the electronic specialty materials divi- team at Honeywell executed on a plan sion at APD in the early 2000s. There, To find the opportunities for innova- to develop innovative offerings for we produced components that leading tion, my team at Honeywell mapped our new gas technology. The new tech- chipmakers used in products such as markets and the competitive landscape nology yielded positive results, as our smartphones and flat panel televisions. in which we were operating. We thought team took Honeywell Transportation about what our team could learn from Systems from a 12 percent to a 20 At that time, the semiconductor deals that had been lost and set those as percent operating income margin – industry was experiencing waves targets for our business to hit. and a win rate of nearly 50 percent in of change, with Asia-based firms a market with six major competitors. becoming more significant and wafer We also forced ourselves to consider sizes expanding while line dimensions the impact that our innovation work Adopt a customer-centric were dramatically being reduced. would have from our customers’ point of approach to innovation view. To do this, we began as if we were When developing ideas for new offer- To adapt to these changes, we doubled- actually further along in the process and ings, it is easy to lose sight of how down on innovation, and made sure to were already pitching the new offering to involve our customers in the process. a customer – a strategy that I have used to help determine value propositions at many different points in my career. In fact, I always ask development teams to write the one-page letter our customer would send to their chairman to receive approval for the product. This has pushed my teams to think about the prop- osition in both technical and economic terms and to ask important questions, such as what is known, believed, and assumed about the proposed product. In the beginning, it is fine if the team only has a hypothesis for each of these considerations, but ultimately, they should arrive at a sense of how the customer will benefit from the product overall. 94 The European Business Review November - December 2019

We accomplished this by performing customer become successful. Forging When innovative success is achieved, analytical work on-site in our customers’ relationships with customers as global there are many accolades to be shared. development labs, offering this as a paid champions of new offerings, in my Until then, a company must be ego-free service. Here, identifying innovators – as experience, reinforced my organisa- in the development phase – and that discussed in one of our previous lessons tion’s market position. can mean catching and correcting atti- – became key: we searched for people tudes to the contrary while a project is in our organisation who not only had Aligning internal teams still in its nascent stages. the technical expertise and confidence around innovation to build new products but also had the Sometimes, resistance to innova- Conclusion listening skills and curiosity to act as tion can stem from individuals’ own Today, technology is becoming an sounding boards for our customers, in egos; in corporations, many leaders increasingly important source of differ- order to best understand their needs. can become too heavily invested in entiation and the ability to generate new focusing on the base business. As a profit streams. As a leader, it is vital to Conducting development efforts at result, they may feel that deviating from understand and engage with the tech- our customers’ facilities engaged them running the established business could nologically-rooted shifts that are taking in our work and allowed us to bring jeopardise their personal advance- place. Still, there are other elements of value to the customers by providing ment at the organisation. Thus, these managerial strategy that should come capabilities that they needed. Thanks individuals fail to see opportunities to into play in order to facilitate innova- to this strategy, our business doubled explore new ideas and are reluctant to tion in the technological age. its margins and grew sevenfold in a re-develop portfolios to respond to five-year period. Additionally, we were customers’ changing needs. The six concepts that I have explored able to expand our business in Korea, in this series are inputs that will help exec- Taiwan, Japan, and China and move I experienced the challenges of elim- utives adopt a leadership style conducive the business’s global headquarters from inating this barrier to progress when to fostering a culture of innovation. In North America to Asia. I was working in a division of APD turn, creating an organisational culture that produced hydrogen products used that places innovation at its core will It’s also useful to keep customers to create clean fuels and low-sulfur, encourage teams to capitalize upon the on board even after the development low-particulate transportation fuels. enhanced capabilities offered by new process is complete. Customers can Initially, many at the organisation technology and will enable them to do serve as strong partners in publicising believed in the widely accepted notion so at a competitive pace. and communicating about the new that the refining industry would not offering when it is ready to be brought allow third parties to operate processing About the Author to market. Customers can endorse the plants on their sites. My team, however, Over the past three decades, product by publishing joint papers held fast to our business model’s Terrence Hahn has worked or presenting jointly at conferences innovation agenda and put together a across eight different indus- with R&D leaders and other company business case that supported APD’s tries in six countries, with a executives; this establishes a two-way plans to increase the scale and relia- dozen years spent at exchange that in turn helps the bility of its hydrogen plants, in part by connecting the plants in clusters. Honeywell, including as CEO of its Technology is becoming Home and Buildings Technologies busi- We also made sure to identify the ness and CEO of Transportation an increasingly important right people at our customers’ organi- Systems, along with nearly twenty years at sations in order to move the innovation Air Products & Chemicals driving growth source of differentiation and projects forward. Sometimes, this meant across multiple end markets. reaching out to a VP of strategy the ability to generate new or members of the sales team and Terrence is an innovator of software, explaining the project to them so that services, new materials and operating profit streams. As a leader, they could act as our advocates. In the systems that drive business success. He end, our efforts took the business from has recently started a new role as the CEO it is vital to understand several hundred millions of dollars to of API Technologies, a Massachusetts- several billions of dollars in revenue. based technology company that also has and engage with the European operations. technologically-rooted shifts that are taking place. www.europeanbusinessreview.com 95

Intellectual Property 3-STEPS to Commercialising Intellectual Property in the Creative Industries BY GENE SHILL The value of intangible goods is making an to, ephemeral art. Typically, ephemeral (temporary) unprecedented contribution to the global art transcends the physical and malleable charac- economy as the world becomes progressively teristics of tangible goods and are more often digitised, with many products and services than not measured by attitudes and perceptions shifting from the marketplace to the market- which can be directly related to social and cultural space. This article discusses and outlines the capital. Furthermore, advancements in technology formative steps to commercialising intellec- also enhance the capabilities of knowledge-based tual property in the creative industries and the industries such as creative, education and innova- impact the creative economy is making globally. tion to now emerge as some of the most dynamic sectors of the global economy. Although commer- T he value of intangible goods is making an cialising intellectual property and placing value on unprecedented contribution to the global intangible goods is not a new concept, leveraging economy as the world becomes progressively its ‘invisible advantage’ and combining it with the digitised, with many products and services shifting likes of technology is what’s creating an additional from the marketplace to the marketspace. While value add within the Global Creative Economy. the price of intangible goods such as patents, intel- lectual property, and brand equity carry a mystique Products of the Creative Industries’ (advertising, and value challenging to calculate, its presence in architecture, art, crafts, design, fashion, film, music, the global economy is unapologetic. Further, add performing arts, publishing, R&D, software, toys and the importance of social and cultural capital into games, TV, radio and video games) drive the global the fold, and the future of intangible asset trade Creative Economy which is forecast to generate becomes an exciting prospect. upwards of €580 billion euros annually at the close of the 2020 European fiscal year.1 In short, the Creative With consumers placing greater emphasis on Economy is leveraging creativity, technology, culture experience, quality and performance, products and innovation to foster inclusive and sustained of the Creative Industries that sit within Global economic growth and development, which provides Creative Economy offer additional value add bothcommercialandculturalvalue.Acknowledgement through intangible creations such as, but not limited of its dual worth has led governments worldwide With consumers placing greater emphasis on experience, quality and performance, products of the Creative Industries that sit within Global Creative Economy offer additional value add through intangible creations such as, but not limited to, ephemeral art. 96 The European Business Review November - December 2019

to expand and develop their creative economies Calculating the value of intellectual as part of economic diversification strategies and property varies depending on a broad range efforts to stimulate economic growth, prosperity of factors – primarily the time, context, and well-being.2 purpose and application of the valuation. Calculating the value of intellectual property through new or pre-existing IP. varies depending on a broad range of factors It is safe to say we generally associate orches- – primarily the time, context, purpose and appli- tras with set classical repertoire, but their cation of the valuation. The music streaming musicianship can be commercialised and used in platform Spotify demonstrates how their busi- ways that far exceed the traditional ephemeral live ness model successfully operates in response and recorded form. to these key factors by using intangible prod- Much of today’s music is recorded using sampled ucts of Creative Industries to engage with their music, which is not necessarily illegally obtained subscribers. It allows subscribers to access a and appropriated into a new context. It comes global catalogue of music and podcasts via a from sample packs or ‘user interfaces’, where a ‘freemium’ or ‘premium’ subscription service. producer or production team use instrumentalists to create a small bespoke library of sounds sold This service exists entirely on streaming intan- digitally and royalty-free as a profit share agree- gible goods, but also provides the company with a ment. These samples are typically accessed using secondary source of income via intangible assets. a subscription service and make their way into It permits Spotify to collect and collate big data commercial recordings used in advertising, video which can be ‘sold on’ to varies parties interested games, animation, film, television, or into the song in researching user habits. This data then forms of a new artist. the basis of new initiatives to access and capture By utilising an orchestra’s ability to perform at new audiences through digital applications. a very high level, they are applying creative intel- ligence to launch into a new market far outside Premised by the commercialisation of intel- the scope of its traditional application. The most lectual property, this business model signifies the successful sample packs demonstrate not only high- uncapped potential of Creative Industries products quality recording and production skills but more can provide when adequately valued and modelled. importantly, performance skills. It allows the musi- Further, it proves duel worth not only exists in cians to gain an ROI against their developed skillset ‘tangible’ commercial and cultural goods but also but also in a broader context, develop a form of found in the invisible advantage of intangibility, brand extension. which in this case is worth roughly USD 409 million to Spotify annually. Here are the first ‘3 Steps to Commercialising Intellectual Property in the Creative Industries’ which initiate and inform strategy. 1. CREATIVE INTELLIGENCE 2 VALUE PROPOSITION DESIGN 1. Ensuring creatives’ are intrinsically invested 1. UCE (Unique Customer Experience). It’s all in their craft/discipline enough to leverage about the experience. Is it tangible or intan- their skills to create novel and interesting gible? Alternatively, both? ideas; and 2. Create value through narrative cohesion. Build 2. Placing direct value on the ability to think a consistent relationship between the product laterally and create new revenue streams and the audience. The narrative shouldn’t shift

Intellectual Property A business model is a system of elements and connections; some features and relationships are more important than others. too far left or right and if it does, guide the and Development’s Creative Economy audience with context and information. Programme, is leading global discussions and 3. Shift focus to place value on both tangible panels in this field. The Creative Economy and intangible assets. Does this double Programme is at the forefront of research the value when combined? Extract and and developmental initiatives to support the define the intangible elements and how it growth and future of the global Creative relates to the overall experience. Economy, focussing on commercial and 4. Why buy and why use? What’s the magnet? cultural goods trade. In the case of the orchestra, the magnet is giving artists’ and producers’ the means to About the Author access content they a) can’t make themselves Dr Gene Shill is Assistant or b) unable to afford to make themselves. Professor in Creative They’re also looking for ROI. Entrepreneurship and Practice at Hong Kong Baptist University. 3 INNOVATIVE BUSINESS MODELS With a background in entrepre- A business model is a system of elements and connections; some features and relationships neurship and intellectual property law in the are more important than others. Therefore, global creative industries, he is also an estab- how do these essential aspects function to your lished contemporary saxophonist and record advantage? There are no one-stop bullets for producer of the alias ST. AMANT. creating, evaluating, adapting or implementing business models, brilliant or otherwise.3 References Therefore creating or modifying a business 1. UNCTAD. (2018). Creative Economy Outlook: Trends in International model to suit your purpose is paramount. Trade in Creative Industries. P.1 Retrieved from Geneva: https://unctad. 1. What business models exist and align with org/en/PublicationsLibrary/ditcted2018d3_en.pdf 2. UNCTAD. (2018). Creative Economy Outlook: Trends in International a technologically savvy world? Do pre-ex- Trade in Creative Industries. Retrieved from Geneva: https://unctad. isting models from other industries work or org/en/PublicationsLibrary/ditcted2018d3_en.pdf is a hybrid model required? 3. Bock, Adam J. & George, Gerrard. The Business Model Book: Design, 2. History has told us that not all business Build and Adapt Business Ideas that Thrive. P.28. Pearson models are effective, but a flexible organ- isational structure can be. How does this relate to your current organisational structure? Moving quickly and efficiently is advantageous. 3. Verify the most intimate details of the concept/product, evaluate market size and profitability, evaluate possible sustaina- bility and of course, the ability to define a target audience. As technology and digital platforms develop, so will the demand and growth of intangible goods. Marisa Henderson, Chief of the United Nations Conference on Trade 98 The European Business Review November - December 2019



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