16 PERSONALITY FACTOR MODEL BY CATTEL

Personality traits and scales used to measure traits are numerous and commonality amongst the traits and scales is often difficult to obtain. To curb the confusion, many personality psychologists have attempted to develop a common taxonomy. A notable attempt at developing a common taxonomy is Cattell's Sixteen Personality Factor Model based upon personality adjectives taken form the natural language. Although Cattell contributed much to the use of factor analysis in his pursuit of a common trait language his theory has not been successfully replicated. Science has always strived to develop a methodology through which questions are answered using a common set of principles; psychology is no different. In an effort to understand differing personalities in humans, Raymond Bernard Cattell maintained the belief that a common taxonomy could be developed to explain such differences. Cattell's scholarly training began at an early age when he was awarded admission to King's College at Cambridge University where he graduated with a Bachelor of Science in Chemistry in 1926 (Lamb, 1997). According to personal accounts, Cattell's socialist attitudes, paired with interests developed after attending a Cyril Burt lecture in the same year, turned his attention to the study of psychology, still regarded as a philosophy (Horn, 2001). Following the completion of his doctorate studies of psychology in 1929 Cattell lectured at the University at Exeter where, in 1930, he made his first contribution to the science of psychology with the Cattell Intelligence Tests (scales 1,2, and 3). During fellowship studies in 1932, he turned his attention to the measurement of personality focusing of the understanding of economic, social and moral problems and how objective psychological research on moral decision could aid such problems (Lamb, 1997). Cattell's most renowned contribution to the science of psychology also pertains to the study of personality. Cattell's 16 Personality Factor Model aims to construct a common taxonomy of traits using a lexical approach to narrow natural language to standard applicable personality adjectives. Though his theory has never been replicated, his contributions to factor analysis have been exceedingly valuable to the study of psychology. Origins of the 16 Personality Factor Model In developing a common taxonomy of traits for the 16 Personality Factor model, Cattell relied heavily on the previous work of scientists in the field. Previous development of a list of personality descriptors by Allport and Odbert in 1936, and Baumgartner’s similar work in German in 1933, focused on a lexical approach to the dimensions of personality. Since psychology, like most other sciences, requires a descriptive model to be effective, the construction of a common taxonomy is necessary to successful in explaining personality simplistically (John, 1990). Already focused on the understanding of personality as it pertains to psychology, Cattell set out to narrow the work already completed by his predecessors. The goal of the research is to achieve integration as it relates to language and personality, that is, to identify the personality relevant adjectives in the language relating to specific traits. The lexical approach to language is creates the foundation of a shared taxonomy of natural language of personality description (John, 1990). Historically, psychologists

relied on such natural language to aid in the identification of personality attributes for such taxonomy. The first step in such a process was to narrow all adjectives within a language to those relating to personality descriptions, as it provided the researchers with a base guiding such a lexical approach. When working with a limited set of variables or adjectives within a language progressed from spoken word as it evolved throughout its progression. Since there are finite sets of adjectives in a language, the narrowing of the variables into base personality categories becomes necessary as multiple adjectives can express similar meanings within the language (John, 1999). In the process of developing a taxonomy, a process that had taken predecessors sixty years up to this point, Allport and Odbert systematized thousands of personality attributes in 1936. They recognized four categories of adjectives in developing the taxonomy including personality traits, temporary states highly evaluative judgments of personally conduct and reputation, and physical characteristics. Personality traits are defined as "generalized and personalized determining tendencies--consistent and stable modes of an individuals adjustment to their environment" (John, 1999) as stated by Allport and Odbert in their research. Each adjective relative to personality falls within one of the previous categories to aid in the identification of major personality categories and creates a primitive taxonomy, which many psychologists and researchers would elaborate and build upon later. Norman (1967) divided the same limited set of adjectives into seven categories, which, like Allport and Odbert's categories, where all mutually exclusive (John, 1999). Despite this, work from both parties have been classified as containing ambiguous category boundaries, resulting in the general conviction that such boundaries should be abolished and the work has less significance than the earlier judgment. Factor Analysis Introduced and established by Pearson in 1901 and Spearman three years thereafter, factor analysis is a process by which large clusters and grouping of data are replaced and represented by factors in the equation. As variables are reduced to factors, relationships between the factors begin to define the relationships in the variables they represent (Goldberg & Digman, 1994). In the early stages of the process' development, there was little widespread use due largely in part to the immense amount of hand calculations required to determine accurate results, often spanning periods of several months. Later on a mathematical foundation would be developed aiding in the process and contributing to the later popularity of the methodology. In present day, the power of super computers makes the use of factor analysis a simplistic process compared to the 1900's when only the devoted researchers could use it to accurately attain results (Goldberg & Digman, 1994). In performing a factor analysis, the single most import factor to consider is the selection of variables as considerations such as domain, where a single domain results in the highest accuracy, and other representative variables related to a single domain would provide a more accurate outcome (Goldberg & Digman, 1994). Exploratory factor analysis governs a single domain while confirmatory factor analysis, often less accurate and more difficult to calculate, governs several domains. In terms of variables, it is unlikely to see a factor analysis with fewer than 50 variables. In those situations, another statistical equation may be a better, easier consideration to process the information. A

standard sample size for such a function would range between 500 to 1,000 participants (Goldberg & Digman, 1994). Cattell, another champion of the factor analysis methodology, believed that there are three major sources of data when it comes to research concerning personality traits (Hall & Lindzey, 1978). L-Data, also referred to as the life record, could include actual records of a person's behavior in society such as court records. Cattell, however, gathered the majority of L-Data from ratings given by peers. Self -rating questionnaires, also known as Q-Data, gathered data by allowing participants to assess their own behaviors .The third source of Cattell's data the objective test, also known as T-Data, created a unique situation in which the subject is unaware of the personality trait being measured (Pervin & John, 2001). With the intent of generality, Cattell's sample population was representative of several age groups including adolescents, adults and children as well as representing several countries including the U.S., Britain, Australia, New Zealand, France, Italy, Germany, Mexico, Brazil, Argentina, India, and Japan (Hall & Lindzey, 1978). Through factor analysis, Cattell identified what he referred to as surface and source traits. Surface traits represent clusters of correlated variables and source traits represent the underlying structure of the personality. Cattell considered source traits much more important in understanding personality than surface traits (Hall& Lindzey, 1978). The identified source traits became the primary basis for the 16 PF Model. The 16 Personality Factor Model aims to measure personality based upon sixteen source traits. Table 1 summarizes the surface traits as descriptors in relation to source traits within a high and low range. Critical Review Although Cattell contributed much to personality research through the use of factor analysis his theory is greatly criticized. The most apparent criticism of Cattell's 16 Personality Factor Model is the fact that despite many attempts his theory has never been entirely replicated. In 1971, Howarth and Brown's factor analysis of the 16 Personality Factor Model found 10 factors that failed to relate to items present in the model. Howarth and Brown concluded, “that the 16 PF does not measure the factors which it purports to measure at a primary level (Eysenck & Eysenck, 1987) Studies conducted by Sell et al. (1970) and by Eysenck and Eysenck (1969) also failed to verify the 16 Personality Factor Model's primary level (Noller, Law, Comrey, 1987). Also, the reliability of Cattell's selfreport data has also been questioned by researchers (Schuerger, Zarrella, & Hotz, 1989). Cattell and colleagues responded to the critics by maintaining the stance that the reason the studies were not successful at replicating the primary structure of the 16 Personality Factor model was because the studies were not conducted according to Cattell's methodology. However, using Cattell's exact methodology, Kline and Barrett (1983), only were able to verify four of sixteen primary factors (Noller, Law & Comrey, 1987). In response to Eysenck's criticism, Cattell, himself, published the results of his own factor analysis of the 16 Personality Factor Model, which also failed to verify the hypothesized primary factors (Eysenck, 1987).

Despite all the criticism of Cattell's hypothesis, his empirical findings lead the way for investigation and later discovery of the 'Big Five' dimensions of personality. Fiske (1949) and Tupes and Christal (1961) simplified Cattell's variables to five recurrent factors known as extraversion or surgency, agreeableness, consciousness, emotional stability and intellect or openness (Pervin & John, 1999). Cattell's Sixteen Personality Factor Model has been greatly criticized by many researchers, mainly because of the inability of replication. More than likely, during Cattell's factor analysis errors in computation occurred resulting in skewed data, thus the inability to replicate. Since, computer programs for factor analysis did not exist during Cattell's time and calculations were done by hand it is not surprising that some errors occurred. However, through investigation into to the validity of Cattell's model researchers did discover the Big Five Factors, which have been monumental in understanding personality, as we know it today. Descriptors of Low Range Primary Factor Descriptors of High Range Warm, outgoing, attentive to others, kindly, easy-going, participating, likes people (Affectothymia) Abstract-thinking, more intelligent, bright, higher general mental capacity, fast learner (Higher Scholastic Mental Capacity) Emotionally stable, adaptive, mature, faces reality calmly (Higher Ego Strength) Dominant, forceful, assertive, aggressive, competitive, stubborn, bossy (Dominance) Lively, animated, spontaneous, enthusiastic, happy go lucky, cheerful, expressive, impulsive (Surgency)

Impersonal, distant, cool, reserved, Warmth detached, formal, aloof (A) (Schizothymia) Concrete thinking, lower general mental capacity, less intelligent, Reasoning unable to handle abstract problems (B) (Lower Scholastic Mental Capacity) Reactive emotionally, changeable, Emotional affected by feelings, emotionally Stability less stable, easily upset (Lower Ego (C) Strength) Deferential, cooperative, avoids conflict, submissive, humble, obedient, easily led, docile, accommodating (Submissiveness) Serious, restrained, prudent, taciturn, introspective, silent (Desurgency) Expedient, nonconforming, disregards rules, self indulgent (Low Super Ego Strength) Shy, threat-sensitive, timid, hesitant, intimidated (Threctia) Dominance (E)

Liveliness (F)

Rule-conscious, dutiful, Ruleconscientious, conforming, Consciousness moralistic, staid, rule bound (High (G) Super Ego Strength) Social Boldness Socially bold, venturesome, thick (H) skinned, uninhibited (Parmia)

organized. self blaming (Guilt Proneness) Open to change. conventional (Praxernia) Forthright. skeptical. unpretentious. tough minded. solitary. individualistic. easy (Alaxia) Grounded. patient. absent Abstractedness minded. secure. artless. nondisclosing. frustrated. driven. free thinking. self doubting. self-sentimental (High Self-Concept Control) Tense. liberal. high energy. tranquil. flexible. torpid. oppositional (Protension) Abstract. control. self-disciplined. absorbed in (M) ideas (Autia) Privateness (N) Apprehension (O) Private. steady. practical. self. solution oriented. analytical. affiliative. prosaic. selfconflict. shrewd. ATTITUDE COMPETENCE . unsentimental. respecting traditional Change ideas (Conservatism) (Q1) Group-oriented. (High Ergic Tension) Traditional. objective. rough (I) (Harria) Trusting. guileless. involved (Artlessness) Self-Assured. Openness to conservative.Sensitivity reliant. naive. unsuspecting. exacting will power. over wrought. worldly. confident. free of guilt. genuine. impractical. compulsive. flexibility (Radicalism) Self-reliant. unexacting. insecure. discreet. experimental. guilt prone. worried. resourceful. a joiner Self-Reliance and follower dependent (Group (Q2) Adherence) Tolerates disorder. socially precise. polished. intuitive. imaginative. complacent. attached to familiar. composed low drive (Low Ergic Tension) Perfectionism (Q3) Tension (Q4) Primary Factors and Descriptors in Cattell's 16 Personality Factor Model (Adapted From Conn & Rieke. worrying. uncontrolled (Low Integration) Relaxed. lax. aesthetic. diplomatic (Shrewdness) Apprehensive. self sufficient (SelfSufficiency) Perfectionistic. open. astute. sentimental. time driven. undisciplined. tender minded.Utilitarian. 1994). unworried. accepting. distrustful. unconditional. placid. impatient. refined (Premsia) Vigilant. no-nonsense. careless of social rules. suspicious. self satisfied (Untroubled) Vigilance (L) Sensitive. critical. impulsive.

competencies and attitudes. refer to the ability to perform specific tasks. At least not only! I believe success. Examples of competencies: • ability to communicate effectively • ability to write clearly • ability to play an instrument • ability to solve problems • ability to dance The last one. involves how people react to certain situations and how they behave in general. Most of the people. attitude. pay an excessive attention to the knowledge component while neglecting the development of the other two.If you want to have success you should should try to absorb as much knowledge as possible right? Well. derives from three factors: knowledge. however. Examples of knowledge: • second degree equations • human anatomy • the rules of monopoly • how to change a wheel • the capital of Zimbabwe (Harare. Before discussing the argument further we need to define what we mean by each of these factors. experience or association. on the other hand. not quite. whether we talk at professional or personal level. Knowledge is practical information gained through learning. if nothing else you learned this reading this article…) Competencies. Examples of attitudes: • being proactive .

Now. Competencies come before knowledge because they are flexible and can be applied to many different situations. on the other hand. knowledge is essential. While this affirmation might be true. If you take a look at the five attitudes we used as example it is clear that one would desire to develop the first three. and there is nothing one can do to change it. Why then do we fail to dedicate enough energy to the development of valuable attitudes? First because we might think that attitude is affected by the genetic. Mark. This is far from the truth.being able to get along with other people being optimistic being critic towards other people being arrogant Now. you will see that attitudes are the base of the pyramid. After developing the attitudes (which is a life long process. if you take a look at the picture below. Should the financial services sector enter a downturn some day who do you think will have a harder time? Yeah. • • • • . The common sense states that the more knowledgeable someone is. his ability to solve problems. when I defend that prior to getting the knowledge one should develop attitudes and competencies I am not saying that knowledge is not important. financial reports. While most people are naturally inclined to behave in certain ways we can still radically change or develop specific attitudes at will. he studies balance sheets. meaning that some people are born optimistic while others are naturally pessimistic. to come up with innovative ideas and so on. Distinguishing between a desirable and a problematic attitude is actually an easy task. John uses his time gaining as much knowledge as possible. the more successful he will be. therefore. but that is exactly why it is also more valuable. The last part of the pyramid is formed by the knowledge. Both of them are eager to succeed so that they spend lots of time trying to grow professionally. Other than that he uses his time to improve his writing skills. I am sure you have guessed it. working for a financial services company. accounting practices and the like. gets the knowledge that is necessary to carry out his job. Far from it. it is only so if that person also has the right attitudes. by the way) one should focus on competencies. The second reason why people fail to focus on attitudes is because they are not aware of the benefits they would derive from that. Consider two different men. But if you consider the information and communication technologies revolution you can see that virtually . Developing or changing an attitude will require much more work than developing a competence or gaining some knowledge. focus on developing the right attitudes before passing to the competencies and to the knowledge. John and Mark. One should.

it allows an effective approach toward improving them. The data was collected from organizations that contracted with the U. who funded the research. therefore. success at personal or professional level will inevitably derive from three factors: attitudes. is that the knowledge alone will not be sufficient.S.anyone in the world has access to all the information ever produced. Like any model. . It does not represent a competitive advantage per se. Eventually it became clear that the model could be applied to other processes. Summing up. What I am saying. Department of Defense. Make sure you are focusing on all the three components. competencies and knowledge. but the process of transforming one into the other is not that complex. Most people pay an excessive attention to the knowledge component while neglecting the development of competencies and attitudes. This gave rise to a more general concept that is applied to business processes and to developing people. it is an abstraction of an existing system. it is the best strategy in the long run. I know that information and knowledge are two different things. CAPABILITY MATURITY MODEL The Capability Maturity Model (CMM) is a service mark owned by Carnegie Mellon University (CMU) and refers to a development model elicited from actual data. When it is applied to an existing organization's software development processes. and became the foundation from which CMU created the Software Engineering Institute (SEI).

Gerald Weinberg. for example insoftware engineering. Larry Constantine. and human capital management. if at all. risk management. the use of computers grew more widespread. In an effort to determine why this was occurring. who. with few standard or "best practice" approaches defined. Tom DeMarco. Version 1. . several US military projects involving software subcontractors ran overbudget and were completed far later than planned. Individuals such as Edward Yourdon.[1] The first application of a staged maturity model to IT was not by CMM/SEI. the United States Air Force funded a study at the SEI. services. project management. and the demand for software development grew significantly. As a result. the growth was accompanied by growing pains: project failure was common. In the 1980s. Precursor The Quality Management Maturity Grid was developed by Philip B.[2] Watts Humphrey began developing his process maturity concepts during the later stages of his 27 year career at IBM. The CMM is based on the process maturity framework first described in the 1989 book Managing the Software Process by Watts Humphrey.1) and as a book by the same authors in 1995. commerce. Organizations began to adopt computerized information systems. Though the CMM comes from the field of software development.The Capability Maturity Model (CMM) was originally developed as a tool for objectively assessing the ability of government contractors' processes to perform a contracted software project. but rather by Richard L. industry and software development organizations. Nolan. HISTORY Prior need for software processes In the 1970s. and the ambitions for project scale and complexity exceeded the market capability to deliver. software maintenance. (References needed) Development at SEI Active development of the model by the US Department of Defense Software Engineering Institute (SEI) began in 1986 when Humphrey joined the Software Engineering Institute located at Carnegie Mellon University in Pittsburgh. It was later published in a report in 1993 (Technical Report CMU/SEI-93-TR-024 ESC-TR-93-177 February 1993. and the field of computer science was still in its infancy. it is used as a general model to aid in improving organizational business processes in diverse areas. flexible and less costly. information technology (IT). in 1973 published the stages of growth model for IT organizations. The CMM has been used extensively worldwide in government offices. system engineering. business processes generally. Capability Maturity Model SM for Software. and David Parnas began to publish articles and books with research results in an attempt to professionalize the software development process. Crosby in his book "Quality is Free". system acquisition. The processes for software development were in their infancy.

rather than measuring the maturity of each separate development process independently.1 being completed in January 1993. Department of Defense in evaluating the capability of software contractors as part of awarding contracts. Though it comes from the area of software development. The Capability Maturity Model Integration (CMMI) project was formed to sort out the problem of using multiple CMMs. Humphrey based this framework on the earlier Quality Management Maturity Grid developed by Philip B.S. Weber. has been. Air Force he began formalizing his Process Maturity Framework to aid the U. it can be. and improvement activities. At the request of the U. Applying multiple models that are not integrated within and across an organization could be costly in training. with Version 1. For software development processes.. in Managing the Software Process.l Maturity model A maturity model can be viewed as a set of structured levels that describe how well the behaviours. Superseded by CMMI The CMM model proved useful to many organizations. Bill Curtis.[5] The CMM was published as a book[6] in 1995 by its primary authors. Mark C.[1] However. Watts Humphrey's Capability Maturity Model (CMM) was published in 1988[3] and as a book in 1989.g. Charles V.Pennsylvania after retiring from IBM.S. for example :  a place to start  the benefit of a community’s prior experiences . appraisals. The CMM has thus been used by different organizations as a general and powerful tool for understanding and then improving general business process performance. Paulk. but its application in software development has sometimes been problematic. Adapted to other processes The CMM was originally intended as a tool to evaluate the ability of government contractors to perform a contracted software project. A maturity model may provide. though the CMM continues to be a general theoretical process capability model used in the public domain. IT service management processes) in IS/IT (and other) organizations. practices and processes of an organisation can reliably and sustainably produce required outcomes. the CMM has been superseded by Capability Maturity Model Integration (CMMI). Crosby in his book "Quality is Free". and continues to be widely applied as a general model of the maturity of processes (e. The full representation of the Capability Maturity Model as a set of defined process areas and practices at each of the five maturity levels was initiated in 1991. The result of the Air Force study was a model for the military to use as an objective evaluation of software subcontractors' process capability maturity. Humphrey based his approach on the staged evolution of a system of software development practices within an organization. and Mary Beth Chrissis. Humphrey's approach differed because of his unique insight that organizations mature their processes in stages based on solving process problems in a specific order.[4] Organizations were originally assessed using a process maturity questionnaire and a Software Capability Evaluation method devised by Humphrey and his colleagues at the Software Engineering Institute (SEI).

the process is managed in accordance with agreed metrics. the basis for comparison would be the organizations' software development processes.  Goals: the goals of a key process area summarize the states that must exist for that key process area to have been implemented in an effective and lasting way. 2.the process is defined/confirmed as a standard business process.  Key Practices: The key practices describe the elements of infrastructure and practice that contribute most effectively to the implementation and institutionalization of the KPAs. individual heroics) . achieve a set of goals considered important.    Structure The Capability Maturity Model involves the following aspects:  Maturity Levels: a 5-level process maturity continuum . Measurement and Analysis. for example. While not rigorous. 3. Defined . and control of an organization's software processes are believed to improve as the organization moves up these five levels.  Key Process Areas: a Key Process Area (KPA) identifies a cluster of related activities that.for example. and for each KPA there are five definitions identified: .process management includes deliberate process optimization/improvement. The extent to which the goals have been accomplished is an indicator of how much capability the organization has established at that maturity level.the starting point for use of a new process. ad hoc. Levels There are five levels defined along the continuum of the CMM[7] and. a way to define what improvement means for your organization.  Common Features: common features include practices that implement and institutionalize a key process area. Within each of these maturity levels are Key Process Areas (KPAs) which characterise that level. and decomposed to levels 0. effectiveness.a common language and a shared vision a framework for prioritizing actions. when performed together. In the case of the CMM. for comparative assessment of different organizations where there is something in common that can be used as a basis for comparison. Optimizing . The goals signify the scope. 4. There are five types of common features: commitment to Perform. Managed ." 1. according to the SEI: "Predictability. and intent of each key process area. A maturity model can be used as a benchmark for comparison and as an aid to understanding .where the uppermost (5th) level is a notional ideal state where processes would be systematically managed by a combination of process optimization and continuous process improvement. Quantitatively managed 5. and Verifying Implementation. Initial (chaotic. 1 and 2 (the latter being Work Instructions). the empirical evidence to date supports this belief. boundaries. Activities Performed. Ability to Perform.

Level 3 . for software development ).frustrate the successful development of their software.Optimizing It is a characteristic of processes at this level that the focus is on continually improving process performance through both incremental and innovative technological changes/improvements. Measurement 5. Level 5 . they are the AS-IS processes) and used to establish consistency of process performance across the organization. uncontrolled and reactive manner by users or events. Skipping levels is not allowed/feasible.1. using process metrics. . for example. representing — as they do — the stages that organizations must go through on the way to becoming mature. tending to be driven in an ad hoc. Though these companies may have successfully developed their software. Goals 2. they would not necessarily have considered or defined or managed their processes as the CMM described as level 3 or above. Verification The KPAs are not necessarily unique to CMM. Level 4 .on the face of it . This provides a chaotic or unstable environment for the processes. Ability 4. Process discipline is unlikely to be rigorous. Symantec. These standard processes are in place (i. Level 1 . Level 2 .Defined It is characteristic of processes at this level that there are sets of defined and documented standard processes established and subject to some degree of improvement over time.Repeatable It is characteristic of processes at this level that some processes are repeatable.g. and these examples include many shrinkwrap companies (also called commercial-off-the-shelf or "COTS" firms orsoftware package firms). but critics pointed out that process maturity according to the CMM was not necessarily mandatory for successful software development.e. possibly with consistent results. and so would have fitted level 1 or 2 of the model. and Lotus. Claris.B. It has been used for and may be suited to that purpose. Apple.Initial (Chaotic) It is characteristic of processes at this level that they are (typically) undocumented and in a state of dynamic change... management can effectively control the AS-IS process (e. There were/are reallife examples where the CMM was arguably irrelevant to successful software development. but where it exists it may help to ensure that existing processes are maintained during times of stress.Managed It is characteristic of processes at this level that. The CMM provides a theoretical continuum along which process maturity can be developed incrementally from one level to the next. Such firms would have included.: The CMM was originally intended as a tool to evaluate the ability of government contractors to perform a contracted software project. This did not . Microsoft. In particular. N. Commitment 3. Process Capability is established from this level. management can identify ways to adjust and adapt the process to particular projects without measurable losses of quality or deviations from specifications.

Describes the process information content recommended by the CMM. to shift the mean of the process performance) to improve process performance. processes are concerned with addressing statistical common causes of process variation and changing the process (for example. Software process framework The software process framework documented is intended to guide those wishing to assess an organization/projects consistency with the CMM. The level overview checklists are further refined into checklists for:  KPA purposes (Key Process Areas)  KPA Goals  policies  standards  process descriptions  procedures  training  tools  reviews and audits  work products managed and controlled  measurements Process Procedure Level overview . The process checklists are further refined into checklists for:  roles  entry criteria  inputs  activities  outputs  exit criteria  reviews and audits  work products managed and controlled  measurements  documented procedures  training  tools Describes the recommended content of documented procedures described in the CMM.At maturity level 5. For each maturity level there are five checklist types: TypeSD Description Policy Standard Describes the policy contents and KPA goals recommended by the CMM. Describes the recommended content of select work products described in the CMM. Provides an overview of an entire maturity level. This would be done at the same time as maintaining the likelihood of achieving the established quantitative process-improvement objectives.

Software Project Planning.Project Management . Capability Maturity Model . and provide a point of reference for appraising current processes. Australia.focii .Heroes . Originally applied to software development (SE-CMM). management. provide guidance for quality processes. Software Project Tracking and Oversight. Requirements Management. or an entire organization. • Your visibility into the organization's activities is increased to help you ensure that your product or service meets the customer's expectations. A formal comparison of a CMMI model to your processes is called an appraisal. • You learn from new areas of best practice (e. Software Subcontract Management. This kind of response has substantiated the SEI's commitment to CMMI. The Standard CMMI Appraisal Method for Process Improvement (SCAMPI) incorporates the best ideas of several process improvement appraisal methods. and Africa. Peer Reviews. measurement. Software Quality Assurance. Level 3 Defined . Training Program. including North America. The levels . South America. CMM offers a framework for evolutionary process improvement. The benefits you can expect from using CMMI include the following: • Your organization's activities are explicitly linked to your business objectives.Overview CMMI is a process improvement approach that provides organizations with the essential elements of effective processes that ultimately improve their performance.None. set process improvement goals and priorities. Asia. CMMI can be used to guide process improvement across a project.(CMM) The Software Engineering Institute's model of software engineering that specifies five levels of maturity of the processes of a software organisation.and key process areas are: Level 1 Initial . Europe. a division.g.. Inter-group Coordination. Level 2 Repeatable . You can use CMMI in three different areas of interest: • Product and service acquisition (CMMI for Acquisition model) • Product and service development (CMMI for Development model) • Service establishment.Organisation Process Focus.Engineering Process . Software Configuration Management. Organisation Process Definition. it has been expanded to cover other areas including Human Resources and Software Acquitition. risk) CMMI is being adopted worldwide. Software . It helps integrate traditionally separate organizational functions. and delivery (CMMI for Services model) CMMI models are collections of best practices that you can compare to your organization's best practices and guide improvement to your processes.

all based on a set of eight fundamental concepts.Process Change Management. the business excellence criteria within the models broadly channel and encourage the use of best practices into areas where their effect will be most beneficial to performance. and public responsibility. project management. . These critical links between business excellence models. partnership development. people development and involvement." In general. do so for the following purposes: self-assessment. stakeholder value. innovation and improvement. When used simply for self-assessment. BUSINESS EXCELLENCE MODEL Business excellence is the systematic use of quality management principles and tools in business management. refers to "outstanding practices in managing the organization and achieving results. Users of the EFQM Excellence Model. preventative management and management by facts. business excellence models have been developed by national bodies as a basis for award programs. leadership and constancy of purpose. and benchmarking are fundamental to the success of the models as tools of continuous improvement. Technology Change Management. The most popular and influential model in the western world is the Malcolm Baldrige National Quality Award Model (also known as the Baldrige model. process management. the awards themselves are secondary in importance to the widespread adoption of the concepts of business excellence. continuous learning. customer focus. the criteria can clearly identify strong and weak areas of management practice so that tools such as benchmarking can be used to identify best-practice to enable the gaps to be closed.Software Quality Management. Level 4 Managed . Integrated Software Management. strategy formulation.Product Engineering. areas of strength. the Six Sigma statistical tools. with the goal of improving performance based on the principles of customer focus. management by processes and facts. By far the majority of organizations that use these models do so for self-assessment. launched by the US government. More than 60 national and state/regional awards base their frameworks upon the Baldrige criteria. Defect Prevention. which ultimately leads to improved national economic performance. best practice. When used as a basis for an organization's improvement culture. or the Criteria for Performance Excellence). andproject management. Lean. Some of the tools used are the balanced scorecard. Level 5 Optimising . For most of these bodies. for instance. the Baldrige Criteria. Business excellence. and process management. as described by the European Foundation for Quality Management (EFQM). Key practices in business excellence applied across functional areas in an enterprise include continuous and breakthrough improvement. Quantitative Process Management." These concepts are "results orientation.Continuous Improvement .Product and Process Quality . and ideas for future organizational development. through which they may identify improvement opportunities. visioning. and mergers. supplier management.

driving constant monitoring. Financial. The Model.The essence of the Methodology is to concentrate in a perfect blend of Focus between Processes. The 'Results' criteria cover what an organisation achieves. Measure/Analyze. which recognises there are many approaches to achieving sustainable excellence in all aspects of performance. Monitor/Control.) The main idea is that neither of those elements can be improved by itself and it needs to be balanced and improved in a blend with the other two. non-prescriptive framework based on nine criteria. The 'Enabler' criteria cover what an organisation does. . 'Results' are caused by 'Enablers'. Those phases evolve continuously within the ever-growing organization. Technologies and Resources (Human. optimization and re-evaluation.Because of the blend of different methodologies that have specific phases within their processes Business Excellence drives results through four well defined phases: Discover/Define. Create/Optimize. that is delivered through People Partnerships and Resources. is based on the premise that: Excellent results with respect to Performance. Process Phases . etc. Customers. and Processes. People and Society are achieved through Leadership driving Policy and Strategy. Five of these are 'Enablers' and four are 'Results'. Overview of the Excellence Model The Model is an over-arching.

represent the criteria against which to assess an organisation's progress towards excellence. Below each sub-criterion are lists of possible areas to address. Each of the nine criteria has a definition. They show innovation and learning helping to improve enablers that in turn lead to improved results. Within this non-prescriptive approach there are some Fundamental Concepts which underpin the EFQM Model. Enablers Leadership Policy & Strategy People Partnerships & Resources Processes Results Customer Results People Results Society Results Key Performance Results The Fundamental Concepts of Excellence The EFOM Model is a non-prescriptive framework that recognises there are many approaches to achieving sustainable excellence. Model structure The Model's nine boxes. which explains the high level meaning of that criterion. To develop the high level meaning further each criterion is supported by a number of sub-criteria. Sub-criteria pose a number of questions that should be considered in the course of an assessment.The arrows emphasise the dynamic nature of the model. shown above. These are . The areas to address are not mandatory nor are they exhaustive lists but are intended to further exemplify the meaning of the sub-criterion.

Innovation & Improvement Excellence is challenging the status quo and effecting change by using learning to create innovation and improvement opportunities. Assessment and Review. Customer Focus Excellence is creating sustainable customer value. . Corporate Social Responsibility Excellence is exceeding the minimum regulatory framework in which the organisation operates and to strive to understand and respond to the expectations of their stakeholders in society. Partnership Development Excellence is developing and maintaining value-adding partnerships. There is no significance intended in the order of the concepts. RADAR At the heart of the self assessment process lies the logic known as RADAR which has the following elements: Results. coupled with constancy of purpose. Management by Processes & Facts Excellence is managing the organisation through a set of interdependent and interrelated systems. processes and facts. Approach. People Development & Involvement Excellence is maximising the contribution of employees through their development and involvement.expressed below. Results Orientation Excellence is achieving results that delight all the organisation's stakeholders. Leadership & Constancy of Purpose Excellence is visionary and inspirational leadership. The list is not meant to be exhaustive and they will change as excellent organisations develop and improve. Continuous Learning. Deployment.

The business excellence model is a tool. organizations are looking for every opportunity to improve their business results. .The logic of RADAR® states that an organisation should: • Determine the Results it is aiming for. which has a set of criteria using which the organization can improve performance on the critical factors that can drive their business to success. 1) Hoshin Kanri (policy deployment) 2) TQM 3) Deming award model 4) MNBQA model 5) Six Sigma 6) Lean 7) TPM CII . and financial.Exim or EFQM 9) Balanced scorecard 10)SEI-CMMI/PCMMI With rapid change in marketplace and ever-increasing competition in today's business environment. product and service. The criteria provides a framework for performance excellence and helps the organization to assess and measure performance on a wide range of key business indicators like customer. the organization lays firm approach to drive performance and attain higher levels of efficiency. operational. Why organizations should have a Business Excellence model ? 1) Highly competitive environment 2) To achieve Companies Mission & Vision 3) To achieve excellent Business results & Customer delight 4) To improve brand image 5) CEO's Passion for excellence 6) To bulid a great organization 7) To achieve break-through improvements Buisness excellence model is the means of achieving all the above. • Assess and Review the effectiveness of the approaches. Organisations can develop a customized business excellence model and/or adopt one or more of the below mentioned concepts. • Deploy the approaches systematically. To be competitive to sustain growth. • Implement an integrated set of sound Approaches to deliver the required results.

knowledge sharing. suppliers. there are many excellence models available. • Framework for excellence through values. • Understanding the business and analyzing in areas like . and the public. This is the chosen model by the TATA group to help in building globally competitive organizations across TATA Group companies. Business excellence model is: • A comprehensive coverage of strategy-driven performance • Focuses on the needs. Tata Business excellence model is based on this. Although.S. • Delivering ever-improving value to customers. • It asks questions. which enables to translate the organizations vision & strategy in to coherent set of performance and measures. you can refer to “Malcolm Baldrige National Quality Award” model. Organizations also uses “Balanced score card” as performance measurement system. expectations and satisfaction of all stakeholders • Examines all processes that are essential in achieving business excellence • Is a framework to assess and enhance business excellence • Continuous improvement of organizational overall performance and capabilities. productivity. TBEM is based on the Malcolm Balridge National Quality Award Model of the U. In short. The Criteria have three important roles in strengthening competitiveness: • To help improve organizational performance practices. contributing to organizational sustainability • Improvement of overall organisational effectiveness and capabilities . and the results. capabilities. TATA Business Excellence Model Tata Business Excellence Model is a framework which helps companies to achieve excellence in their business performance.leadership. strategy. effectiveness. but does not provide solutions. production processes. The criteria also helps the organization to align its resources. • To help in guiding organizational planning and opportunities for learning TBEM Criteria is designed to help organizations use an integrated approach to organisational performance management that results in • Delivery of ever-improving value to customers and stakeholders. market. and results • To facilitate communication and sharing of best practices information among all organisations within TATA Group. processes. In the model. employees. they call it as “Approach”. and outcome. and achieve the goals. owners. resulting in marketplace success. customer.This allows the organization to carry out a self assessment on the business performance and allows to identify strengths and to target areas for “opportunities for improvement” on processes and results affecting all key stakeholders – including customers. This is again a framework. “deployment” and “results” • It is not a prescriptive model. information & data. HR.

keeping Operational excellence and Business results in focus. • BUSINESS FUNDING MODEL Importance of Sustainability Planning Many existing campus-based publishing collaborations pay less direct attention to sustainability planning and financial structures than to the design and technical implementation of the collaborative projects themselves. and Knowledge Management • Work force Focus • Process Management • Business Results The TBEM criteria are the operational details of the Core Values. as libraries and presses move beyond narrowly defined. Such a focus is understandable. low-risk projects to undertake more ambitious .Organisational and personal learning The Criteria are built on the following set of 11 Interrelated Core Values and Concepts: • Visionary Leadership • Customer-driven Excellence • Organisational and Personal Learning • Valuing Employees and Partners • Agility • Focus on the Future • Managing for Innovation • Management by Fact • Social Responsibility • Focus on Results and Creating Value • Systems Perspective The Core Values and Concepts are embodied in seven Categories. applied to the different facets of a Business organisation. The 7 Criteria Categories are divided into 18 items and 32 Areas to Address The TBEM framework has the following characteristics • Focus on Business results • Non-prescriptive and Adaptable • Maintains System Perspective • Supports Goal based diagnosis TBEM instills a process centric approach in an organisation as a means to achieve the chosen Business Goals Tata Teleservices Limited as a part of the TATA Group has adopted the TATA Business Excellence model as an intricate part of its operation structure and uses it to grow from strength to strength. as working through these sustainability issues requires that a collaboration’s partners reconcile significant operational and cultural differences. However. Analysis. as follows: • Leadership • Strategic Planning • Customer and Market Focus • Measurement.

long-term collaborative programs. such an ad hoc approach will often be ill-suited for sustaining more ambitious. and why they must be reconciled to support significant.[45] Indeed. This section describes the organizational context in which most collaborations will operate. and cost-recovery expectations under which presses must typically operate. a temporary diversion of staff time and/or a limited capital outlay may provide sufficient resources for its projects.2 Reconciling Financial Models Many current publishing partnerships are of limited scope and duration.long-term publishing programs. and • the utility of business principles—irrespective of funding model—for managing a collaboration. in which relatively little of the press’s activity directly benefits the host institution—then it might operate under the same funding model as the library. cost recovery. Libraries and university presses share much in common: both operate on a nonprofit model and each seeks. or net surplus seeking). Section 5 discusses practical issues relevant to structuring and managing a library-press publishing collaboration. digital publishing environment. and duration of collaborative projects would be limited. in its own way. scope. collaborative activity would lack the full commitment of both partners. the scale. the library may not consider its mission objectives to be adequately served and the press may not be able to commit significant resources to a long-term collaborative publishing program. and as a result. 4. long-term collaboration. Unless such an improbable transformation takes place. this conservatism is scarcely surprising. some university presses may view the range of potential business models narrowly. If a university press were to be fully subsidized by its host institution—a remote contingency under the prevailing model. including: • the disparate funding models of the library and the press. For a collaboration with relatively modest goals. If these differences are not explicitly recognized and accommodated. • the potential benefits of earned revenue for fulfilling a collaboration’s mission. considering the limited resources. including: • setting financial performance expectations (whether subsidized deficit. there are real differences in the operating structures and strategies of libraries and presses. However. practical reality . University presses are sometimes characterized as resistant to change or unsupportive of new models that might support scholarly communication in a networked. In such cases. and • choosing between multiple projects. resolving these differences becomes increasingly critical to success. slim margins. However. to fulfill a mission that serves the needs of its host institution. focusing on established market models. even when those models are beginning to fail. • tracking costs and allocating resources. However. Together these sections provide an overview of the financial and business issues many libraries and presses face in collaborating and offer practical insight on how a collaboration might be structured and managed. and these must be reconciled to allow a library-press partnership to realize its full potential.

a market approach might compromise the collaboration’s mission and objectives by limiting its target audiences’ access to the products or services it offers. there may be instances where partners want to pursue activities for which a) adequate subsidies are not available and/or b) an earned revenue model provides a viable source of income. If the partnership emphasizes open-access models. they must manage their publishing activities overall to balance mission fulfillment and revenue generation. However. supplemented by title subsidies and endowment income (5%). A typical breakdown of an institutional library’s funding sources would include about 75-85% from university appropriations and about 5-15% from designated funds. with the balance coming from sponsored programs and endowments. approximately 45% of a university library’s budget will typically cover staff costs and 40% will go towards materials acquisitions. 4. then participation in the collaboration would require the press to divert resources from other subsidized mission-critical publishing activities. If a collaboration fails to accommodate the requirements imposed by the press’s financial model. or provides products or services that cannot capture sufficient value on the open market. Some press projects will balance both the press’s mission and revenue objectives. Libraries and academic computing centers are funded by institutional standing budgets. If a partnership were to secure a subsidy sufficient to fund all of the activities necessary to achieve its mission. A partnership’s strategic objectives. while university presses generate most or all of their operating budgets through earned revenue from market activities. university presses operate on a combination of earned income (80-90%) and institutional subsidies (5-15%). Even where its activities are capable of generating earned revenue. while other projects may cross-subsidize mission-worthy publications that are incapable of covering their own costs. will affect whether subsidies. irrespective of the source of a partnership’s income. then there would be no need for it to use revenue-generating models.2.[48] As presses depend on earned revenue for 80-90% of their operating budgets. then the potential for generating selfsustaining revenue from those activities may be limited.dictates that a partnership establish a financial structure that reconciles the disparate funding models under which each partner operates.2. Recognizing the requirements of the press’s funding model will allow a collaboration to channel subsidies and/or create hybrid revenue-subsidy models that permit the press to participate fully in a collaboration. the press must manage its publishing portfolio to cover both direct and indirect costs to remain operationally self-sustaining. which may be highly valued by the host institution and its faculty. 4.[47] On average.1 Partnership Funding Models The need for a shared financial understanding remains. or a combination of the two provides a viable business model for its projects. with other operating expenses representing 15% of the budget.[46] In terms of expense categories. and the types of projects that it intends to undertake as a result. overall. earned revenue.2 The Role of Earned Revenue . Whatever the mix. For presses and libraries to collaborate successfully requires a funding model and financial structure that allows the press to participate without diverting resources from other mission-critical publishing programs.

[52] Here the distinction between competition and profit as motivators for campus-based market activities is instructive. such excesses will sometimes provide the impetus for library participation in online publishing collaborations. If all the partnership’s projects were to generate positive financial contributions. By exploiting market opportunities to generate income. In such cases. as opposed to cultural stereotyping. publishing as much high-quality content as their resources allow. a partnership may be able to pursue more activities that fulfill its mission with a combination of subsidy and earned revenue than by subsidy alone.[51] 4. a campus-based publishing venture would receive subsidies from its host institution commensurate with the full mission value it delivers. Competition for scarce institutional resources. indeed.3 The Utility of Business Principles The aggressive market practices of some commercial publishers have tainted the perception of market-based publishing models for many in the academy. In this way.[50] A publishing project with a positive financial contribution—the difference between what the project generates and the direct costs it incurs—provides funds available for cross-subsidizing publishing activities that support the program’s mission. business processes and market models do have relevance and utility for campus-based publishing partnerships. Campus-based publishing collaborations need to couple . However. As long as the income-generating activities are well aligned with the partnership’s mission—and revenue generation serves as a means to an end. it does provide a financial framework in which the projected returns can be assessed. mission maximization is subject to financial constraints. may leave a partnership inadequately subsidized to fully achieve its objectives. the surplus generated can be applied to support publishing programs that do not generate revenue.Ideally. coupled with the problems inherent in demonstrating and quantifying the mission value delivered by its activities. rather than an end in itself—the market activity may contribute positively to achieving the mission. university presses seek to maximize mission attainment. some projects will require cross-subsidies from projects with positive contributions. this will seldom be the case. a collaboration can benefit from the market orientation that a press brings to the partnership. Regardless of whether it uses a subsidy or earned revenue model. they operate differently than commercial entities. but that are not financially self-sustaining. and that might otherwise not be possible. there would be no need for cross-subsidies. the marginal cost of increasing the publishing program should equal the marginal mission attainment per dollar spent plus the marginal revenue generated. It will be important for library partners in collaborations to examine where resistance to market forces and business principles represent a genuine value conflict.[49] A partnership can subsidize financially unprofitable projects from the revenue contributed by projects that generate a surplus and/or from income from institutional subsidies and other sources. While commercial publishers maximize profits. Although university presses work under a market model. for many partnerships. In terms of program investment decisions. However. However. In practice. a publishing partnership can relax the financial constraint and thus fuel greater levels of mission attainment. Although this approach does not avoid the problems inherent in assigning a financial value to mission attainment. In such situations. a collaboration may elect to generate earned revenue by imposing fees for some or all of its products and services.

ignoring the market sacrifices the discipline that market participation requires. including gains in efficiency that the collaboration would not have undertaken had it been insulated from competition. RISK MANAGEMENT . [53] Markets provide incentives to respond to demand and to improve operating efficiency and productivity.the feedback mechanisms and performance stimulants of market participation with the value-driven goal of mission attainment. All things being equal. the collaboration operates as efficiently and cost effectively as possible given the resources available. As Bok and others have observed. while complete reliance on the market and earned revenue would expose a collaboration to forces that may not align well with its mission and values. Rather. insulation from market forces can reduce the mission relevance and financial value of a partnership’s output. This will allow the partnership to better serve the needs of its constituencies by funding activities with high mission value. and result in the suboptimal use of resources. The issue in applying business principles and practices is not that a partnership should alter its mission—in terms of what it publishes or the constituencies it serves—in order to generate a surplus. market forces compel nonprofit entities to assess both what they do and how well they do it. The pressures of market competition on revenue contribution—which funds mission attainment—should prompt productivity improvements. that in serving its mission. lower its operating efficiency. but low market value. cost savings from increased efficiency fund cross-subsidies for non-revenue generating projects with high mission value and allow an initiative to charge less for its services than profit-maximizing ventures. Thus. Stated negatively.

and earnings quality. and control the probability and/or impact of unfortunate events[1] or to maximize the realization of opportunities. The vocabulary of risk management is defined in ISO Guide 73. Risks can come from uncertainty in financial markets. decrease cost effectiveness. credit risk. profitability. reducing the negative effect of the risk. Several risk management standards have been developed including the Project Management Institute. Certain aspects of many of the risk management standards have come under criticism for having no measurable improvement on risk even though the confidence in estimates and decisions increase This section provides an introduction to the principles of risk management. a knowledge risk materializes. definitions and goals vary widely according to whether the risk management method is in the context of project management. "Risk management. security. the National Institute of Science and Technology. engineering. monitor. avoiding the risk. financial portfolios. Vocabulary. service."[2] In ideal risk management. actuarial assessments. actuarial societies. Resources spent on risk management could have been spent on more profitable activities. project failures. Intangible risk management identifies a new type of a risk that has a 100% probability of occurring but is ignored by the organization due to a lack of identification ability.[2][3] Methods. Intangible risk management allows risk management to create immediate value from the identification and reduction of risks that reduce productivity. assessment. quality. Again. legal liabilities. reputation. and accepting some or all of the consequences of a particular risk. and risks with lower probability of occurrence and lower loss are handled in descending order. The strategies to manage risk include transferring the risk to another party. industrial processes. and prioritization of risks (defined in ISO 31000 as the effect of uncertainty on objectives. or public health and safety. Relationship risk appears when ineffective collaboration occurs. These risks directly reduce the productivity of knowledge workers. Processengagement risk may be an issue when ineffective operational procedures are applied. Risk management also faces difficulties in allocating resources. In practice the process can be very difficult. when deficient knowledge is applied to a situation.Risk management is the identification. a prioritization process is followed whereby the risks with the greatest loss and the greatest probability of occurring are handled first. whether positive or negative) followed by coordinated and economical application of resources to minimize. brand value. For example. accidents. . ideal risk management minimizes spending and minimizes the negative effects of risks. natural causes and disasters as well as deliberate attacks from an adversary. and balancing between risks with a high probability of occurrence but lower loss versus a risk with high loss but lower probability of occurrence can often be mishandled. This is the idea of opportunity cost. and ISO standards.

characterize. in the following order.e. the expected consequences of specific types of attacks on specific assets) 4. assess the vulnerability of critical assets to specific threats 3. performed. prioritize risk reduction measures based on a strategy Principles of risk management The International Organization for Standardization (ISO) identifies the following principles of risk management:[4] Risk management should:  create value  be an integral part of organizational processes  be part of decision making  explicitly address uncertainty  be systematic and structured  be based on the best available information  be tailored  take into account human factors  be transparent and inclusive  be dynamic.Method For the most part. 1. identify. identify ways to reduce those risks 5. and assess threats 2. more or less. iterative and responsive to change  be capable of continual improvement and enhancement . determine the risk (i. these methods consist of the following elements.

Mapping out the following: the social scope of risk management the identity and objectives of stakeholders the basis upon which risks will be evaluated. The chosen method of identifying risks may depend on culture. customers and legislative bodies such as the government.  Problem analysis[citation needed] Risks are related to identified threats. cause problems. lightning striking an aircraft during takeoff may make all people onboard immediate casualties. Risks are about events that. Hence. Mitigation or Solution of risks using available technological. 3.According to the standard ISO 31000 "Risk management -. Any event that may endanger achieving an objective partly or completely is identified as risk. 2."[3] the process of risk management consists of several steps as follows: Establishing the context Establishing the context involves: 1. 6. 5. The threats may exist with various entities. . For example: the threat of losing money.    Identification of risk in a selected domain of interest Planning the remainder of the process. human and 4. when triggered. For example: stakeholders withdrawing during a project may endanger funding of the project. Examples of risk sources are: stakeholders of a project. Developing an analysis of risks involved in the process. privacy information may be stolen by employees even within a closed network. or with the problem itself. organizational resources. Common risk identification methods are:  Objectives-based risk identification[citation needed] Organizations and project teams have objectives. constraints.  Source analysis[citation needed] Risk sources may be internal or external to the system that is the target of risk management. problem or event. The identification methods are formed by templates or the development of templates for identifying source. risk identification can start with the source of problems. industry practice and compliance.Principles and guidelines on implementation. the threat of abuse of privacy information or the threat of accidents and casualties. most important with shareholders. employees of a company or the weather over an airport. Identification After establishing the context. the events that a source may trigger or the events that can lead to a problem can be investigated. the next step in the process of managing risk is to identify potential risks. When either source or problem is known. Defining a framework for the activity and an agenda for identification.

Scenario-based risk identification In scenario analysis different scenarios are created. The scenarios may be the alternative ways to achieve an objective, or an analysis of the interaction of forces in, for example, a market or battle. Any event that triggers an undesired scenario alternative is identified as risk - see Futures Studies for methodology used byFuturists. Taxonomy-based risk identification The taxonomy in taxonomy-based risk identification is a breakdown of possible risk sources. Based on the taxonomy and knowledge of best practices, a questionnaire is compiled. The answers to the questions reveal risks.[5] Common-risk checking In several industries, lists with known risks are available. Each risk in the list can be checked for application to a particular situation.[6] Risk charting[7] This method combines the above approaches by listing resources at risk, Threats to those resources Modifying Factors which may increase or decrease the risk and Consequences it is wished to avoid. Creating a matrix under these headings enables a variety of approaches. One can begin with resources and consider the threats they are exposed to and the consequences of each. Alternatively one can start with the threats and examine which resources they would affect, or one can begin with the consequences and determine which combination of threats and resources would be involved to bring them about.

Assessment Once risks have been identified, they must then be assessed as to their potential severity of loss and to the probability of occurrence. These quantities can be either simple to measure, in the case of the value of a lost building, or impossible to know for sure in the case of the probability of an unlikely event occurring. Therefore, in the assessment process it is critical to make the best educated guesses possible in order to properly prioritize the implementation of the risk management plan. The fundamental difficulty in risk assessment is determining the rate of occurrence since statistical information is not available on all kinds of past incidents. Furthermore, evaluating the severity of the consequences (impact) is often quite difficult for immaterial assets. Asset valuation is another question that needs to be addressed. Thus, best educated opinions and available statistics are the primary sources of information. Nevertheless, risk assessment should produce such information for the management of the organization that the primary risks are easy to understand and that the risk management decisions may be prioritized. Thus, there have been several theories and attempts to quantify risks. Numerous different risk formulae exist, but perhaps the most widely accepted formula for risk quantification is: Rate of occurrence multiplied by the impact of the event equals risk Composite Risk Index The above formula can also be re-written in terms of a Composite Risk Index, as follows: Composite Risk Index = Impact of Risk event x Probability of Occurrence The impact of the risk event is assessed on a scale of 0 to 5, where 0 and 5 represent the minimum and maximum possible impact of an occurrence of a risk (usually in terms of financial losses).

The probability of occurrence is likewise assessed on a scale from 0 to 5, where 0 represents a zero probability of the risk event actually occurring while 5 represents a 100% probability of occurrence. The Composite Index thus can take values ranging from 0 through 25, and this range is usually arbitrarily divided into three sub-ranges. The overall risk assessment is then Low, Medium or High, depending on the sub-range containing the calculated value of the Composite Index. For instance, the three sub-ranges could be defined as 0 to 8, 9 to 16 and 17 to 25. Note that the probability of risk occurrence is difficult to estimate since the past data on frequencies are not readily available, as mentioned above. Likewise, the impact of the risk is not easy to estimate since it is often difficult to estimate the potential financial loss in the event of risk occurrence. Further, both the above factors can change in magnitude depending on the adequacy of risk avoidance and prevention measures taken and due to changes in the external business environment. Hence it is absolutely necessary to periodically re-assess risks and intensify/relax mitigation measures as necessary. Risk mitigation measures are usually formulated according to one or more of the following major risk options, which are: 1. Design a new business process with adequate built-in risk control and containment measures from the start. 2. Periodically re-assess risks that are accepted in ongoing processes as a normal feature of business operations and modify mitigation measures. 3. Transfer risks to an external agency (e.g. an insurance company) 4. Avoid risks altogether (e.g. by closing down a particular high-risk business area) Later research[citation needed] has shown that the financial benefits of risk management are less dependent on the formula used but are more dependent on the frequency and how risk assessment is performed. In business it is imperative to be able to present the findings of risk assessments in financial terms. Robert Courtney Jr. (IBM, 1970) proposed a formula for presenting risks in financial terms.[8] The Courtney formula was accepted as the official risk analysis method for the US governmental agencies. The formula proposes calculation of ALE (annualised loss expectancy) and compares the expected loss value to the security control implementation costs (cost-benefit analysis). Potential risk treatments Once risks have been identified and assessed, all techniques to manage the risk fall into one or more of these four major categories:[9]  Avoidance (eliminate, withdraw from or not become involved)  Reduction (optimize - mitigate)  Sharing (transfer - outsource or insure)  Retention (accept and budget) Ideal use of these strategies may not be possible. Some of them may involve trade-offs that are not acceptable to the organization or person making the risk management decisions. Another source, from the US Department of Defense, Defense Acquisition University, calls these categories ACAT, for Avoid, Control, Accept, or Transfer. This

use of the ACAT acronym is reminiscent of another ACAT (for Acquisition Category) used in US Defense industry procurements, in which Risk Management figures prominently in decision making and planning. Risk avoidance This includes not performing an activity that could carry risk. An example would be not buying a property or business in order to not take on the legal liability that comes with it. Another would be not flying in order not to take the risk that the airplane were to be hijacked. Avoidance may seem the answer to all risks, but avoiding risks also means losing out on the potential gain that accepting (retaining) the risk may have allowed. Not entering a business to avoid the risk of loss also avoids the possibility of earning profits. Hazard Prevention Main article: Hazard prevention Hazard prevention refers to the prevention of risks in an emergency. The first and most effective stage of hazard prevention is the elimination of hazards. If this takes too long, is too costly, or is otherwise impractical, the second stage is mitigation. Risk reduction Risk reduction or "optimisation" involves reducing the severity of the loss or the likelihood of the loss from occurring. For example, sprinklers are designed to put out a fire to reduce the risk of loss by fire. This method may cause a greater loss by water damage and therefore may not be suitable. Halon fire suppression systems may mitigate that risk, but the cost may be prohibitive as a strategy. Acknowledging that risks can be positive or negative, optimising risks means finding a balance between negative risk and the benefit of the operation or activity; and between risk reduction and effort applied. By an offshore drilling contractor effectively applying HSE Management in its organisation, it can optimise risk to achieve levels of residual risk that are tolerable.[10] Modern software development methodologies reduce risk by developing and delivering software incrementally. Early methodologies suffered from the fact that they only delivered software in the final phase of development; any problems encountered in earlier phases meant costly rework and often jeopardized the whole project. By developing in iterations, software projects can limit effort wasted to a single iteration. Outsourcing could be an example of risk reduction if the outsourcer can demonstrate higher capability at managing or reducing risks.[11] For example, a company may outsource only its software development, the manufacturing of hard goods, or customer support needs to another company, while handling the business management itself. This way, the company can concentrate more on business development without having to worry as much about the manufacturing process, managing the development team, or finding a physical location for a call center. Risk sharing Briefly defined as "sharing with another party the burden of loss or the benefit of gain, from a risk, and the measures to reduce a risk."

The term of 'risk transfer' is often used in place of risk sharing in the mistaken belief that you can transfer a risk to a third party through insurance or outsourcing. In practice if the insurance company or contractor go bankrupt or end up in court, the original risk is likely to still revert to the first party. As such in the terminology of practitioners and scholars alike, the purchase of an insurance contract is often described as a "transfer of risk." However, technically speaking, the buyer of the contract generally retains legal responsibility for the losses "transferred", meaning that insurance may be described more accurately as a post-event compensatory mechanism. For example, a personal injuries insurance policy does not transfer the risk of a car accident to the insurance company. The risk still lies with the policy holder namely the person who has been in the accident. The insurance policy simply provides that if an accident (the event) occurs involving the policy holder then some compensation may be payable to the policy holder that is commensurate to the suffering/damage. Some ways of managing risk fall into multiple categories. Risk retention pools are technically retaining the risk for the group, but spreading it over the whole group involves transfer among individual members of the group. This is different from traditional insurance, in that no premium is exchanged between members of the group up front, but instead losses are assessed to all members of the group. Risk retention Involves accepting the loss, or benefit of gain, from a risk when it occurs. True self insurance falls in this category. Risk retention is a viable strategy for small risks where the cost of insuring against the risk would be greater over time than the total losses sustained. All risks that are not avoided or transferred are retained by default. This includes risks that are so large or catastrophic that they either cannot be insured against or the premiums would be infeasible. War is an example since most property and risks are not insured against war, so the loss attributed by war is retained by the insured. Also any amounts of potential loss (risk) over the amount insured is retained risk. This may also be acceptable if the chance of a very large loss is small or if the cost to insure for greater coverage amounts is so great it would hinder the goals of the organization too much. Create a risk management plan Select appropriate controls or countermeasures to measure each risk. Risk mitigation needs to be approved by the appropriate level of management. For instance, a risk concerning the image of the organization should have top management decision behind it whereas IT management would have the authority to decide on computer virus risks. The risk management plan should propose applicable and effective security controls for managing the risks. For example, an observed high risk of computer viruses could be mitigated by acquiring and implementing antivirus software. A good risk management plan should contain a schedule for control implementation and responsible persons for those actions. According to ISO/IEC 27001, the stage immediately after completion of the risk assessment phase consists of preparing a Risk Treatment Plan, which should document the decisions about how each of the identified risks should be handled. Mitigation of risks often means selection of security controls, which should be documented in a Statement of

Risk can be measured by impacts x probability. Spending too much time assessing and managing unlikely risks can divert resources that could be used more profitably. credit risk and operational risk and also specifies methods for calculating capital requirements for each of these components. which identifies which particular control objectives and controls from the standard have been selected. Unlikely events do occur but if the risk is unlikely enough to occur it may be better to simply retain the risk and deal with the result if the loss does in fact occur. to evaluate the possible risk level changes in the business environment. time can be wasted in dealing with risk of losses that are not likely to occur. Practice. to evaluate whether the previously selected security controls are still applicable and effective. avoid all risks that can be avoided without sacrificing the entity's goals. The Basel II framework breaks risks into market risk (price risk). Purchase insurance policies for the risks that have been decided to be transferred to an insurer. and 2. Enterprise risk management Main article: Enterprise Risk Management . reduce others. experience. There are two primary reasons for this: 1. information risks are a good example of rapidly changing business environment. Prioritizing the risk management processes too highly could keep an organization from ever completing a project or even getting started.Applicability. Limitations If risks are improperly assessed and prioritized. monitoring and controlling the financial or operational risk on a firm's balance sheet. Qualitative risk assessment is subjective and lacks consistency. and why. Review and evaluation of the plan Initial risk management plans will never be perfect. and actual loss results will necessitate changes in the plan and contribute information to allow possible different decisions to be made in dealing with the risks being faced. It is also important to keep in mind the distinction between risk and uncertainty. risk management is the technique for measuring. This is especially true if other work is suspended until the risk management process is considered complete. Risk analysis results and management plans should be updated periodically. Implementation Implementation follows all of the planned methods for mitigating the effect of the risks. See value at risk. and retain the rest. Areas of risk management As applied to corporate finance. For example. The primary justification for a formal risk assessment process is legal and bureaucratic.

as well as external impacts on society.In enterprise risk management.  Maintaining live project risk database. every probable risk can have a pre-formulated plan to deal with its possible consequences (to ensure contingency if the risk becomes a liability). Risk in a project or process can be due either to Special Cause Variation or Common Cause Variation and requires appropriate treatment. as illustrated in the equation above. That is to re-iterate the concern about extremal cases not being equivalent in the list immediately above. or the customers of the enterprise. activities and budget. the resources (human and capital).  Preparing mitigation plans for risks that are chosen to be mitigated. Typical characteristic of risk officer is a healthy skepticism.  the probable increase in cost associated with a risk (cost variance due to risk. C where C = cost accrual ratio * S). In a financial institution. the passengers' meals being served at slightly the wrong time). a project manager can estimate:  the cost associated with the risk if it arises. responsibilities. In the more general case. Each risk should have the following attributes: opening date. Each team member should have possibility to report risk that he/she foresees in the project.  Assigning a risk officer . market risk. a risk is defined as a possible event or circumstance that can have negative influences on the enterprise in question.a team member other than a project manager who is responsible for foreseeing potential project problems. interest rate risk or asset liability management. This is intended to cause the greatest risks to the project to be attempted first so that risk is minimized as quickly as possible. Risk management activities as applied to project management In project management.  This is slightly misleading as schedule variances with a large P and small S and vice versa are not equivalent. enterprise risk management is normally thought of as the combination of credit risk. the products and services. risk management includes the following activities:  Planning how risk will be managed in the particular project. Plan should include risk management tasks.  Creating anonymous risk reporting channel. or cost accrual ratio.  see concerns about schedule variance as this is a function of it. Rc where Rc = P*C = P*CAR*S = P*S*CAR)  sorting on this value puts the highest risks to the budget first. title. probability and importance.  the probable increase in time associated with a risk (schedule variance due to risk. (The risk of the RMS Titanic sinking vs. Its impact can be on the very existence. estimated by multiplying employee costs per unit time by the estimated time lost (cost impact. Rs where Rs = P * S):  Sorting on this value puts the highest risks to the schedule first. The purpose of the mitigation plan is to describe how this particular risk will be handled – . or the environment. From the information above and the average cost per employee over time. and operational risk. Optionally a risk may have an assigned person responsible for its resolution and a date by which the risk must be resolved. markets. short description.

what, when, by who and how will it be done to avoid it or minimize consequences if it becomes a liability. Summarizing planned and faced risks, effectiveness of mitigation activities, and effort spent for the risk management.

Risk management for megaprojects Megaprojects (sometimes also called "major programs") are extremely large-scale investment projects, typically costing more than US$1 billion per project. Megaprojects include bridges, tunnels, highways, railways, airports, seaports, power plants, dams, wastewater projects, coastal flood protection schemes, oil and natural gas extraction projects, public buildings, information technology systems, aerospace projects, and defence systems. Megaprojects have been shown to be particularly risky in terms of finance, safety, and social and environmental impacts. Risk management is therefore particularly pertinent for megaprojects and special methods and special education have been developed for such risk management.[12] [13] Risk management of Information Technology Main article: IT risk management Information technology is increasing pervasive in modern life in every sector.[14] [15] [16] IT risk is a risk related to information technology. This relatively new term due to an increasing awareness that information security is simply one facet of a multitude of risks that are relevant to IT and the real world processes it supports. A number of methodologies have been developed to deal with this kind of risk. ISACA's Risk IT framework ties IT risk to Enterprise risk management. Risk management techniques in petroleum and natural gas For the offshore oil and gas industry, operational risk management is regulated by the safety case regime in many countries. Hazard identification and risk assessment tools and techniques are described in the international standard ISO 17776:2000, and organisations such as the IADC (International Association of Drilling Contractors) publish guidelines for HSE Case development which are based on the ISO standard. Further, diagrammatic representations of hazardous events are often expected by governmental regulators as part of risk management in safety case submissions; these are known as bow-tie diagrams. The technique is also used by organisations and regulators in mining, aviation, health, defence, industrial and finance.[17] [edit]Risk management and business continuity Risk management is simply a practice of systematically selecting cost effective approaches for minimising the effect of threat realization to the organization. All risks can never be fully avoided or mitigated simply because of financial and practical limitations. Therefore all organizations have to accept some level of residual risks. Whereas risk management tends to be preemptive, business continuity planning (BCP) was invented to deal with the consequences of realised residual risks. The necessity to have BCP in place arises because even very unlikely events will occur if given enough time. Risk management and BCP are often mistakenly seen as rivals or overlapping practices. In fact these processes are so tightly tied together that such separation seems artificial. For example, the risk management process creates important inputs for the BCP

(assets, impact assessments, cost estimates etc.). Risk management also proposes applicable controls for the observed risks. Therefore, risk management covers several areas that are vital for the BCP process. However, the BCP process goes beyond risk management's preemptive approach and assumes that the disaster will happen at some point. Risk communication Risk communication is a complex cross-disciplinary academic field. Problems for risk communicators involve how to reach the intended audience, to make the risk comprehensible and relatable to other risks, how to pay appropriate respect to the audience's values related to the risk, how to predict the audience's response to the communication, etc. A main goal of risk communication is to improve collective and individual decision making. Risk communication is somewhat related to crisis communication. Bow tie diagrams A popular solution to the quest to communicate risks and their treatments effectively is to use bow tie diagrams. These have been effective, for example, in a public forum to model perceived risks and communicate precautions, during the planning stage of offshore oil and gas facilities in Scotland. Equally, the technique is used for HAZID (Hazard Identification) workshops of all types, and results in a high level of engagement. For this reason (amongst others) an increasing number of government regulators for major hazard facilities (MHFs), offshore oil & gas, aviation, etc. welcome safety case submissions which use diagrammatic representation of risks at their core. Communication advantages of bow tie diagrams: [17]  Visual illustration of the hazard, its causes, consequences, controls, and how controls fail.  The bow tie diagram can be readily understood at all personnel levels.  "A picture paints a thousand words." Seven cardinal rules for the practice of risk communication (as first expressed by the U.S. Environmental Protection Agency and several of the field's founders)  Accept and involve the public/other consumers as legitimate partners.  Plan carefully and evaluate your efforts with a focus on your strengths, weaknesses, opportunities, and threats.  Listen to the public's specific concerns.  Be honest, frank, and open.  Coordinate and collaborate with other credible sources.  Meet the needs of the media.  Speak clearly and with compassion.

ORGANIZATIONAL MATURITY STAGES

The organizational life cycle (OLC) is a model which proposes that over the course of time, business firms move through a fairly predictable sequence of developmental stages. This model, which has been a subject of considerable study over the years, is linked to the study of organizational growth and development. It is based on a biological metaphor —that business firms resemble living organisms because they demonstrate a regular pattern of developmental process. Organizations that are said to pass through a recognizable life cycle, wrote Gibson, Ivancevich, and Donnelly in Organizations: Behavior, Structure, Processes, are fundamentally impacted by external environmental circumstances as well as internal factors: "We're all aware of the rise and fall of organizations and entire industries…. Marketing experts acknowledge the existence of product-market life cycles. It seems reasonable to conclude that organizations also have life cycles." In a summary of OLC models, Quinn and Cameron wrote in Management Science that the models typically propose that "changes that occur in organizations follow a predictable pattern that can be characterized by developmental stages. These stages are sequential in nature; occur as a hierarchical progression that is not easily reversed; and involve a broad range of organizational activities and structures." The number of life cycle stages proposed in various works studying the phenomenon have varied considerably over the years. Some analysts have delineated as many as ten different stages of an organizational life cycle, while others have flattened it down to as few as three stages. Most models, however, tout the organizational life cycle as a period comprised of four or five stages that can be encapsulated as start-up, growth, maturity, decline, and death (or revival).

Trends in Olc Study While a number of business and management theorists alluded to developmental stages in the early to mid-1900s, Mason Haire's 1959 work Modern Organization Theory is generally recognized as one of the first studies that used a biological model for organizational growth and argued that organizational growth and development followed a regular sequence. The study of organizational life cycles intensified, and by the 1970s and 1980s it was well-established as a key component of overall organizational growth. Organizational life cycle is an important model because of its premise and its prescription. The model's premise is that requirements, opportunities, and threats both inside and outside the business firm will vary depending on the stage of development in which the firm finds itself. For example, threats in the start-up stage differ from those in the maturity stage. As the firm moves through the developmental stages, changes in the nature and number of requirements, opportunities, and threats exert pressure for change on the business firm. Baird and Meshoulam stated in the Academy of Management Review that organizations move from one stage to another because the fit between the organization and its environment is so inadequate that either the organization's efficiency and/or effectiveness is seriously impaired or the organization's survival is threatened. The OLC model's prescription is that the firm's managers must change the goals, strategies, and strategy implementation devices of the business to fit the new set of issues. Thus, different stages of the company's life cycle require alterations in the firm's objectives, strategies, managerial processes (planning, organizing, staffing, directing, controlling), technology, culture, and decision-making. For example, in a longitudinal study of 36 corporations published in Management Science, Miller and Friesen proposed five growth stages: birth, growth, maturity, decline, and revival. They traced changes in the organizational structure and managerial processes as the business firms proceeded through the stages. At birth, the firms exhibited a very simple organizational structure with authority centralized at the top of the hierarchy. As the firms grew, they adapted more sophisticated structures and decentralized authority to middle- and lower-level managers. At maturity, the firms demonstrated significantly more concern for internal efficiency and installed more control mechanisms and processes. GROWTH PHASES. Despite the increase in interest in OLC, though, most scholarly works focusing on organizational life cycles have been conceptual and hypothetical in content. Only a small minority have attempted to test empirically the organizational life cycle model. One widely-cited conceptual work, however, was published in the Harvard Business Review in 1972 by L. Greiner. He used five growth phases: growth through creativity; growth through direction; growth through delegation; growth through coordination; and growth through collaboration. Each growth stage encompassed an evolutionary phase ("prolonged periods of growth where no major upheaval occurs in organization practices"), and a revolutionary phase ("periods of substantial turmoil in organization life"). The evolutionary phases were hypothesized to be about four to eight years in length, while the revolutionary phases were characterized as the crisis phases. At the end of each one of the five growth stages listed above, Greiner hypothesized that an organizational crisis will occur, and that the business's ability to handle these crises will determine its future: Phase 1—Growth through creativity eventually leads to a crisis of leadership. More sophisticated and more formalized management practices must be adopted. If the

it is not inevitable that the company will continue to plummet into ultimate failure. This occurs when autonomous employees who prefer to operate without interference from the rest of the organization clash with business owners and managers who perceive that they are losing control of a diversified company. there exists no timeline that dictates that a company will begin to falter at a given point in time. these firms are almost exclusively concerned with the very first stage of the organization life cycle. Lower level managers must be given more authority if the organization is to continue to grow. After all. matrix-type structures. on the other hand. But entrepreneurs and managers should recognize that their business is always somewhere along the life cycle continuum. maturity) and forestall negative stages (decline. Phase 3—Growth through delegation eventually leads to a crisis of control. Basically. Organisational life cycle: growth. is characterized by the use of teams. their concerns are apt to be in such areas as securing financing. Indeed. characteristics. may find OLC studies more relevant. Phase 5—Growth through collaboration. Indeed. The crisis involves top-level managers' reluctance to delegate authority. formal planning processes. and that business success is often predicated on recognizing where your business is situated along that measuring stick. Phase 4—Growth through coordination eventually leads to a crisis of red tape. preparing a physical location for business operations. they must hire someone who can. and more sophisticated information systems. more than age." Organization Life Cycle and the Small Business Owner Entrepreneurs who are involved in the early stages of business creation are unlikely to become preoccupied with life cycle issues of decline and dis-solution. an increase in conferences and educational programs. many recent examinations of organization life cycles have analyzed ways in which businesses can prolong desired stages (growth. Small business owners and other organization leaders may explore a variety of options designed to influence the enterprise's life cycle—from new products to new markets to new management philosophies. maturity. While Greiner did not formally delineate a crisis for this phase.founders can't or won't take on this responsibility. establishing relationships with vendors and clients. and give this person significant authority. "Because every company develops at its own pace. many companies are able to reverse such slides (a development that is sometimes referred to as turning the OLC bell curve into an "S" curve). death). Certainly. and other aspects of business start-up that are integral to establishing and maintaining a viable firm. Phase 2—Growth through direction eventually leads to a crisis of autonomy. once a business begins to enter a decline phase. decline and death . a bureaucratic system that causes delays in decision making and a reduction in innovation. Coordination techniques like product groups." explained Karen Adler and Paul Swiercz in Training & Development. Small business enterprises that are well-established. define the stages of the cycle. the simplification of formal systems. over time. he guessed that it might revolve around "the psychological saturation of employees who grow emotionally and physically exhausted by the intensity of team work and the heavy pressure for innovative solutions. a reduction in corporate staff. and corporate staff become.

1956) can exhibit a similar pattern of change. though not identical. Although the concept of ontogenic development may not be directly applicable to the growth of real organisations due to the difference in basic constituents and mechanisms (i. Greiner’s model suggests how organisations grow. Firstly. there are some differences that require attention.e. Greiner (1972) proposed a growth model that explained the growth in business organisations as a predetermined series of evolution and revolution (Figure 11.Organisations exhibit a similar. physiological growth reaches its climax at about the age of 25 whereas the growth phase of an organisation can vary to a great extent.”). 1972). “The five phases of organisational growth (adapted from Greiner. As mentioned previously. positive feedback plays a vital role in explaining changes in a living .2. which is similar. the mechanics upon which changes are based are different. This is also consistent with General System Theory. biological vs. In order to grow. but the basic reasons behind the growth process and its mechanics remain unclear. However. decline. while organisations are not. According to Boulding (1956). Figure 11. They grow. Genetic factors and available resources both influence growth in organisms. socio-technical). to the concept of ontogenic development. growth in a living organism is a result of the interplay between the ontogenic factor and the environment. Secondly. the organisation is supposed to pass through a series of identifiable phases or stages of development and crisis. The five phases of organisational growth (adapted from Greiner. a process termed ‘ontogenic development’ (Ayres. Organisms develop from fertilisation to maturity through a programmed or predetermined genetic code. 1972). Thus. In human beings. which attempts to unify the bodies of knowledge in various disciplines (Bertalanffy. the duration of each stage is less precise than that of typical organisms. Apart from this. Living organisms are typical biological machines with their own physics and chemistry. mature. there is a similar idea upon which the description of growth in organisations can be based. it is interesting to see that systems at different levels of complexity (Boulding. life-cycle pattern of changes to living organisms. Here. 1994).2. to some degree. it is also necessary that the organism acquire sufficient necessary resources from the environment to sustain its life and remain viable. organisations are at a higher level of complexity than living organisms. and eventually pass away. 1973).

This growth and the increase in resource acquisition capabilities provides a positive feedback loop. Although we argue that the concept of homeokinesis and net positive feedback can also be applied to the explanation of deterioration and demise in organisations. et al. this effort. which eventually results in the system’s expiry. it is argued that a living system is really in a state of disequilibrium. a state of evolution termed ‘homeokinesis’. which continues until the organism matures. 1991. and is deteriorating. An analogy can be made between the process of growth in a business organisation and that in an organism (provided that the business organisation pursues a growth strategy). equilibrium condition to remain viable. Beyond the ‘upper threshold’. which will be mentioned later. The positive feedback loop will be active again when the organism starts to decline. an increase in competition or the depletion of resources within a particular niche) take effect. in order to grow (or to effect other changes in a system). a business organisation in that niche is likely to run at a profit (provided that the relevant costs are under control). As they keep growing. to gain more market control. Rather than maintaining its dynamic equilibrium. 1972. A living system cannot perpetually maintain growth. which can be described and explained. it is apparent that the system is again operating in a positive feedback region. the importation of materials and energy from the environment not only sustains life but also contributes to growth. as noted earlier it is very difficult to make a direct homology between changes in organisms and changes in organisations. the system matures. After its growth. If the resources in a niche or a domain are abundant. Rather than being a living system’s normal state. nonetheless. 2001). and eventually ends.system. and make even more profit. the more capacity in resources acquisition they have and the more resources they can access. and that require more energy and effort to keep under control. 1978. starting at birth. after age 25 (the physiological climax state). Even though the living system is trying its best to maintain its viability. 2001). Skyttner. the net type of feedback must be positive (Skyttner. in terms of physics and . In organisms.. This positive feedback will continue until limiting factors (e. declines.g. Van Gigch. the body starts to deteriorate but can still function. Rather than being biological machines. to a large extent if not (arguably) completely. it seems that a living system has more factors and contingencies to deal with. An increase in profit results in an improvement in return on investment (ROI). This can be explained by using the concept of ‘homeokinesis’ (Cardon. Although both positive and negative feedback work in concert in any living system. Nonetheless. the fact that a living system deteriorates over time and eventually expires indicates that there is a limit to this. The firm can use these funds to reinvest for expansion. or dynamic. which tends to attract more funds from the investors. After achieving maturity. homeostasis is the ideal or climax state that the system is trying to achieve. Homeostasis can be described in homeokinetic terms as a ‘homeokinetic plateau’– the region within which negative feedback dominates in the living system. cannot counterbalance or defeat the entropically increasing trend. so does their ability to acquire resources. In human physiology. It has already been argued that one of the most important characteristics of any living system is that it has to be in a homeostatic. nor can it ensure its survival and viability forever. This means that the more they grow. but that is never actually achievable. The system gradually and continuously loses its integration and proper functioning.

Kiel (1991) suggests that this dissimilarity can be explained in terms of systems’ differences in their abilities to extract and utilise energy. As mentioned earlier. 1998). and the life expectancy. even though organisations in general may experience decline and death (as many empires and civilisations did in history). artefacts. such duration is very difficult. This suggests that biological systems are less resilient and capable than social systems with respect to natural decline. the organism gradually and continuously loses its ability to keep its integration and organisation under control (to counterbalance the entropically increasing trend) and this finally leads to its demise. This may be reflected in the difference in timing and duration of each of their developmental phases. BUSINESS PLANNING A business plan is a formal statement of a set of business goals. the proper amount of control for a wellfunctioning and sustainable living systems must be present. Adapted from Van Gigch (1991). . the Roman Catholic Church has lasted for centuries (Scott. in contrast. It may be that the size and form of the organisation are influential factors in this respect.chemistry. are relatively definite for a particular type of organism. while the duration of each phase in the life cycle.3. To be in the region of the homeokinetic plateau. Too little control will lead to poor integration and a chaotic situation whereas too much control results in poor adaptation and inflexibility. While this phenomenon is normal in biological systems. it appears that the entropic process in organisations is less definite and more complicated than that in organisms. a proposition that still requires further empirical investigation. and technology working together in an organised manner. after its maturity. the reasons why they are believed attainable. organisations are much more complex socio-technical systems comprising ensembles of people. to specify for organisations. For example. A small business may. on average. if not impossible. and similarly for organisations. Control requires that the system be maintained within the bounds of the homokinetic plateau. It may also contain background information about the organization or team attempting to reach those goals. last from several months to a number of years whereas. and the capacity to reorganise as a result of unexpected and chaotic contextual factors. and the plan for reaching those goals. Figure 11.

With for-profit entities. A business plan represents all aspects of business planning process. They may cover the development of a new product. client. the World Bank. Banks are quite concerned about defaults.a 3 to 5 year business plan is essential. but it can go a long way toward reducing the odds of failure. Venture capitalists are primarily concerned about initial investment. particularly financial stakeholders. This allows success of the plan to be measured using non-financial measures.[2] For government agencies. Externally focused plans target goals that are important to external stakeholders. working group or department. feasibility. various economic agencies of the UN.[3] Project plans. Business plans that identify and target internal goals. understandable. when required. upcoming growth opportunities. and development banks.supply chain management. and attractive to someone who is unfamiliar with the business." . [1] External stake-holders of non-profits include donors and the clients of the non-profit's services. tax-payer. declaring vision and strategy alongside sub-plans to cover marketing. external stakeholders include tax-payers. Writing a good business plan can’t guarantee success. among others. a restructuring of finance. Preparing a business plan draws on a wide range of knowledge from many different business disciplines: finance. one for each of the main business disciplines. They may also address the project's place within the organization's larger strategic goals Business plans are decision-making tools. A business plan for a project requiring equity financing will need to explain why current resources. external stakeholders include investors and customers. a business plan for a non-profit might discuss the fit between the business plan and the organization’s mission. or larger community.. An internal business plan is often developed in conjunction with a balanced scorecard or a list of critical success factors. Operational plans describe the goals of an internal organization. and exit valuation. a new service. They typically have detailed information about the organization or team attempting to reach the goals.. A good business plan can help to make a good business credible. A business plan is a bind summary of those disciplinary plans. operations. human resources as well as a legal plan. higherlevel government agencies. and international lending bodies such as the IMF. Rather the content and format of the business plan is determined by the goals and audience. For example. and sustainable competitive advantage will lead to a high exit valuation. the refurbishing of a factory or a restructuring of the organization. describe the goals of a particular project. Business plans may be internally or externally focused. Internally focused business plans target intermediate goals required to reach the external goals. There is no fixed content for a business plan. and marketing.[6] ". intellectual property management. a new IT system. finance. sometimes known as project frameworks. but provide only general guidance on how they will be met are called strategic plans. so a business plan for a bank loan will build a convincing case for the organization’s ability to repay the loan. When the existing business is to assume a major change or when planning a new venture . human resource management.[5] It can be helpful to view the business plan as a collection of sub-plans.Business plans may also target changes in perception and branding by the customer. operations management.

a demonstration of the product may also be included. It is not uncommon for businesses.The format of a business plan depends on its presentation context.  a written presentation for external stakeholders .  an internal operational plan . customers.a detailed.a hopefully entertaining slide show and oral narrative that is meant to trigger discussion and interest potential investors in reading the written presentation. well written. and pleasingly formatted plan targeted at external stakeholders. This is often used as a teaser to awaken the interest of potential funders. or strategic partners.a three minute summary of the business plan's executive summary. If a new product is being proposed and time permits. especially start-ups to have three or four formats for the same business plan:  an "elevator pitch" . Such plans have a somewhat higher degree of candor and informality than the version targeted at external stakeholders.a detailed plan describing planning details that are needed by management but may not be of interest to external stakeholders. Typical structure for a business plan for a start up venture[7]  cover page and table of contents  executive summary  business description  business environment analysis  industry background  competitor analysis  market analysis  marketing plan  operations plan  management summary  financial plan  attachments and milestones . The content of the presentation is usually limited to the executive summary and a few key graphs showing financial trends and key decision making benchmarks.  an oral presentation .

where the action steps are clearly described. • To update your plans and operations in a changing world.. Marketing builds on market research presented.A business plan is often prepared when: • Starting a new organization. operations and financial. • To establish a roadmap to compare results as the venture proceeds from paper to reality. • To obtain financing from investors and funders. marketing.This is the how-to section of the plan. 2. . including: • To identify an problems in your plans before you implement those plans.Concisely describes what unmet need it will (or does) fill. e. most business plans address the following five topic areas in one form or another. in a Market Opportunity section of the plan. a break-even analysis is often included in this section. including your competitive niche (how you will be better than your competitors in ways that matter to your target customers). acquiring or improving any of the above. Ideally. e. • To minimize your risk of failure. and why their backgrounds and skills make them the right people to make this successful. along with conservative estimates of revenue. products and services -. costs to launch. marketing and operating this venture. operate. competitors and pricing.This section outlines the most likely things that could go wrong with implementing this plan.. typically for three years. 3. There are numerous benefits of doing a business plan.all with less work.Describes the organization. which leads to better results. • To achieve greater profitability in your organization. Business summary -.Arguably the most important part of the plan. usually in four areas: start-up. each person in the management team (and key program and technical folks) are indicated by NAME. Describes credible market research on target customers (including perceived benefits and willingness to pay). • To clarify and synchronize your goals and strategies. Types of Content of a Business Plan Business plans appear in many different formats. business venture or product (service). • To get the commitment and participation of those who will implement the plans. the planning process often is as useful as the business plan document itself.g. it describes who will be responsible for developing. and that the beneficiaries (or a third party) will pay for the costs to meet this need. business venture. market and finance the business. However. 5. 4. and how management is prepared to respond to those problems if they emerge. Contingencies -. Implementation -. operations. presents evidence that this need is genuine. marketing and finances. Market opportunity -. Financial plan includes. 1. People -. management.g. summarizing its purpose. depending on the audience for the plan and complexity of the business. or product (service) or • Expanding. For these reasons.

Key planning questions • Where are we now? • How did we get here ? • Where would we like to be? • How do we get there? • Are we on course to achieve our targets? The planning process . exploit opportunities. Excessive amount of analytical data . in the case of nonprofits. Then the manual guides you through the major considerations you'll have to address when you complete your business plan. an organization will already have in its possession some of the information needed for preparing a business plan. Make tactical plans 7. For example. Analyse the external environment 2. if possible. High complexity of the situation at hand 2.In many cases. Preparation for Planning a Business Venture (nonprofit or for-profit) Before you start a major venture. Formulate strategies 6. confront threats Situational analysis • Analysing the present situation is the prelude to devising objectives and strategies for the future • We need to understand where we are and where we have come from before planning the future • But we must always be careful to avoid paralysis by analysis • This describes a situation in which no decisions are made because of the disproportionate amount of effort that goes into the analysis phase Explanations for "paralysis by analysis" 1. This manual guides you through those considerations.an overview of the key steps 1. grant proposals often contain some of this information. The manual includes numerous links to other free resources as the reader goes through each section of the manual.identify and analyse trends in the environment • Competitor analysis – understand and.resolve weaknesses. Set corporate objectives 5. Analyse the internal environment 3. there are several considerations about yourself that you should address. Build in procedures for monitoring and controlling The planning cycle The key elements & models • Where are we now? The purpose of situational analysis is to determine which opportunities to pursue • Pest/Pestle . Define the business and mission 4. predict the behaviour of competitors • Audit of internal resources • SWOT analysis: build on strengths .

specific statements of anticipated results Strategy versus tactics “Strategy without tactics is the slowest route to victory Tactics without strategy is the noise before the defeat” (Sun Tzu. Excessive focus on planning rather than action 5. where and how activities will take place to accomplish a goal Examples : o Promotional mix o Pricing policy o Production plan These details will be contained in programmes and budgets and will eventually be translated into action plans Action • This involves the implementation of the plan • Remember the greatest strategy on earth is useless unless properly implemented This stage involves: • Action plans • The development of costed action programmes • Detailed budgets • Project management .SMART objectives Goals . Inability to delegate 6. Aversion to risk Where are we going? Vision • Non-specific directional and motivational guidance for the entire operation • What will the organisation be like in five years time Mission statement • An organisation’s reason for being It is concerned with the scope of the business and what distinguishes it from similar businesses Objectives . A rigid.3. The Art of War) • Strategy: the broad approach to achievement of objectives over the long term • Tactics: detailed filling-in of measures designed to contribute to the strategy Designed to achieve short term goals Strategy • The annual business plan specifies actions needed to implement the strategy • Strategy is the broad approach to the achievement of objectives • It starts with the identification and evaluation of strategic objectives • And then summarises how to fulfil the objectives • Strategic options can be analysed by using Ansoff’s matrix and Porter’s generic strategies Tactics • Tactics are designed for the short term • Tactics are the details within the overall the strategy • The details include what. Poor prioritisation 4. formal and rational organisational culture 7.

will lead to further investigations This approach is an example of management by exception. if substantial.Putting the strategy and tactics into action Action plans Action plans convert strategy into a series of steps which answer the following questions: • What is to be done? • How is to be done? • By whom is it to be done? • Who is responsible for making sure it is done? • By when is it to be done? Budgets Budgets play a key role in planning Budgets are presented as spread sheet showing: • Expected sales or cash inflow • Expected and planed expenditure Discretionary spending such as that on promotion can be planned in terms of type of spending and timing with the aid of a budget spreadsheet This allows specialist managers to enjoy some autonomy within the budget but at the same time places a cap on spending and facilitates the monitoring of spending Monitor and control The results of a business should be monitored to determine whether or not the strategic initiatives are being implemented on schedule and within the budgeted resources allocated to it If senior managers are to retain control (whilst delegating detailed implementation) there must be an efficient data collection system feeding back information on progress Control mechanisms • Gantt charts: progress on a project can be monitored against the schedule in the chart • Budgets: monitor actual performance against budget to analyse variance • Management information system (MIS): rather than gathering information on an ad hoc basis organisations use computer software to gather a wide variety of information as a by-product of activities Computer systems capture and process the data to provide managers with continuously up-dated results • • Management by exception A review of current data allows managers to compare actual.not control for its own sake: • Only intervene where deviation is substantial • Feed back results to allow subordinates to correct minor deviations • Keep a focus on strategic goals • If you micro-manage you will not be able to see the wood for the trees .leave matters to subordinates down the line and intervenes only when there is evidence of deviation from the plan Advice to managers • Monitor for success . performance against standards or plans These comparisons will reveal deviations from the plan and.

marketing and operating this venture. 1. However. competitors and pricing. modify plans and take corrective action to ensure put the organisation back on course to achieve its objectives • Planning is not a one off event but a continuing process: • The implementation has to be fine tuned during the period of the plan • Results from the plan will be fed into next years plan A final thought "Planning without action is futile Action without planning is fatal" Types of Content of a Business Plan Business plans appear in many different formats.This is the how-to section of the plan. and why their backgrounds and skills make them the right people to make this successful. market and finance the business. Marketing builds on market research presented. Market opportunity -. operate.Describes the organization. where the action steps are clearly described. business venture or product (service). it describes who will be responsible for developing. 2. operations. 5. operations and financial.Concisely describes what unmet need it will (or does) fill. 3. in a Market Opportunity section of the plan. . marketing and finances. marketing. and that the beneficiaries (or a third party) will pay for the costs to meet this need. usually in four areas: start-up. summarizing its purpose.g. including your competitive niche (how you will be better than your competitors in ways that matter to your target customers). Implementation -. typically for three years.This section outlines the most likely things that could go wrong with implementing this plan. Contingencies -. People -... Business summary -. Ideally. Financial plan includes. 4.Arguably the most important part of the plan. along with conservative estimates of revenue. Describes credible market research on target customers (including perceived benefits and willingness to pay).• • • • Monitor selectively Focus on variables that of great significant and those that provide early warning of major problems And always avoid paralysis by analysis Evaluation and modification • The evaluation of performance should lead an ongoing review process • Where necessary. presents evidence that this need is genuine. management. a break-even analysis is often included in this section. e. each person in the management team (and key program and technical folks) are indicated by NAME.g. most business plans address the following five topic areas in one form or another. costs to launch. e. depending on the audience for the plan and complexity of the business. and how management is prepared to respond to those problems if they emerge.

Department of Defense. it allows an effective approach toward improving them. This manual guides you through those considerations. . For example. CAPACITY MATURITY MODEL The Capability Maturity Model (CMM) is a service mark owned by Carnegie Mellon University (CMU) and refers to a development model elicited from actual data.In many cases. who funded the research. When it is applied to an existing organization's software development processes. and became the foundation from which CMU created the Software Engineering Institute (SEI).S. This gave rise to a more general concept that is applied to business processes and to developing people. The manual includes numerous links to other free resources as the reader goes through each section of the manual. Preparation for Planning a Business Venture (nonprofit or for-profit) Before you start a major venture. Like any model. Eventually it became clear that the model could be applied to other processes. The data was collected from organizations that contracted with the U. grant proposals often contain some of this information. in the case of nonprofits. Then the manual guides you through the major considerations you'll have to address when you complete your business plan. it is an abstraction of an existing system. an organization will already have in its possession some of the information needed for preparing a business plan. there are several considerations about yourself that you should address.

and the demand for software development grew significantly. if at all. software maintenance. information technology (IT). Individuals such as Edward Yourdon. system acquisition. the use of computers grew more widespread.[1] The first application of a staged maturity model to IT was not by CMM/SEI. who. Organizations began to adopt computerized information systems. the United States Air Force funded a study at the SEI. As a result. In the 1980s. with few standard or "best practice" approaches defined. In an effort to determine why this was occurring. Air Force he began formalizing his Process Maturity Framework to aid the U. project management.Overview The Capability Maturity Model (CMM) was originally developed as a tool for objectively assessing the ability of government contractors' processes to perform a contracted software project. industry and software development organizations.1) and as a book by the same authors in 1995. and the ambitions for project scale and complexity exceeded the market capability to deliver. system engineering. the growth was accompanied by growing pains: project failure was common.S. Capability Maturity Model SM for Software. flexible and less costly. Gerald Weinberg. and human capital management. Nolan. Precursor The Quality Management Maturity Grid was developed by Philip B. Tom DeMarco. The processes for software development were in their infancy. business processes generally. several US military projects involving software subcontractors ran overbudget and were completed far later than planned. The CMM has been used extensively worldwide in government offices. Crosby in his book "Quality is Free". Larry Constantine. The CMM is based on the process maturity framework first described in the 1989 book Managing the Software Process by Watts Humphrey. Pennsylvania after retiring from IBM. services. History Prior need for software processes In the 1970s. commerce. and David Parnas began to publish articles and books with research results in an attempt to professionalize the software development process. (References needed) Development at SEI Active development of the model by the US Department of Defense Software Engineering Institute (SEI) began in 1986 when Humphrey joined the Software Engineering Institute located at Carnegie Mellon University in Pittsburgh. it is used as a general model to aid in improving organizational business processes in diverse areas. for example in software engineering.S. but rather by Richard L. Though the CMM comes from the field of software development. . Version 1. It was later published in a report in 1993 (Technical Report CMU/SEI-93-TR-024 ESC-TR-93-177 February 1993.[2] Watts Humphrey began developing his process maturity concepts during the later stages of his 27 year career at IBM. in 1973 published the stages of growth model for IT organizations. At the request of the U. risk management. and the field of computer science was still in its infancy. Department of Defense in evaluating the capability of software contractors as part of awarding contracts.

1 being completed in January 1993. Crosby in his book "Quality is Free". Superseded by CMMI The CMM model proved useful to many organizations. though the CMM continues to be a general theoretical process capability model used in the public domain. rather than measuring the maturity of each separate development process independently.for example. the CMM has been superseded by Capability Maturity Model Integration (CMMI). Charles V. in Managing the Software Process. Humphrey's approach differed because of his unique insight that organizations mature their processes in stages based on solving process problems in a specific order. and continues to be widely applied as a general model of the maturity of processes (e.[5] The CMM was published as a book[6] in 1995 by its primary authors. but its application in software development has sometimes been problematic. it can be. The Capability Maturity Model Integration (CMMI) project was formed to sort out the problem of using multiple CMMs. and Mary Beth Chrissis. • a way to define what improvement means for your organization. for example : • a place to start • the benefit of a community’s prior experiences • a common language and a shared vision • a framework for prioritizing actions. Weber. appraisals. practices and processes of an organisation can reliably and sustainably produce required outcomes. The full representation of the Capability Maturity Model as a set of defined process areas and practices at each of the five maturity levels was initiated in 1991.l Model topics Maturity model A maturity model can be viewed as a set of structured levels that describe how well the behaviours. Humphrey based his approach on the staged evolution of a system of software development practices within an organization.[1] However.. Adapted to other processes The CMM was originally intended as a tool to evaluate the ability of government contractors to perform a contracted software project. Applying multiple models that are not integrated within and across an organization could be costly in training. A maturity model may provide. and improvement activities. with Version 1. Humphrey based this framework on the earlier Quality Management Maturity Grid developed by Philip B. IT service management processes) in IS/IT (and other) organizations.[4] Organizations were originally assessed using a process maturity questionnaire and a Software Capability Evaluation method devised by Humphrey and his colleagues at the Software Engineering Institute (SEI). for comparative assessment of different organizations where .The result of the Air Force study was a model for the military to use as an objective evaluation of software subcontractors' process capability maturity. A maturity model can be used as a benchmark for comparison and as an aid to understanding . Bill Curtis.g. The CMM has thus been used by different organizations as a general and powerful tool for understanding and then improving general business process performance. Though it comes from the area of software development. Paulk. Watts Humphrey's Capability Maturity Model (CMM) was published in 1988[3] and as a book in 1989. has been. Mark C. For software development processes.

Within each of these maturity levels are Key Process Areas (KPAs) which characterise that level. Commitment 3. • Common Features: common features include practices that implement and institutionalize a key process area. In the case of the CMM. and for each KPA there are five definitions identified: 1. Optimizing . ad hoc. and control of an organization's software processes are believed to improve as the organization moves up these five levels. and decomposed to levels 0. achieve a set of goals considered important. Ability to Perform. • Key Process Areas: a Key Process Area (KPA) identifies a cluster of related activities that. Quantitatively managed 5. The goals signify the scope. boundaries.the starting point for use of a new process. • Goals: the goals of a key process area summarize the states that must exist for that key process area to have been implemented in an effective and lasting way. Activities Performed. representing — as they do — the stages that organizations must go through on the way to becoming mature. 2.where the uppermost (5th) level is a notional ideal state where processes would be systematically managed by a combination of process optimization and continuous process improvement. Verification The KPAs are not necessarily unique to CMM.the process is managed in accordance with agreed metrics. the empirical evidence to date supports this belief. . Goals 2. 3. The extent to which the goals have been accomplished is an indicator of how much capability the organization has established at that maturity level. for example. There are five types of common features: commitment to Perform. Defined . and intent of each key process area. Managed . the basis for comparison would be the organizations' software development processes.process management includes deliberate process optimization/improvement.there is something in common that can be used as a basis for comparison. 4. Levels There are five levels defined along the continuum of the CMM[7] and." 1. While not rigorous. Measurement and Analysis.the process is defined/confirmed as a standard business process. • Key Practices: The key practices describe the elements of infrastructure and practice that contribute most effectively to the implementation and institutionalization of the KPAs. individual heroics) . and Verifying Implementation. Initial (chaotic. Structure The Capability Maturity Model involves the following aspects: • Maturity Levels: a 5-level process maturity continuum . Measurement 5. according to the SEI: "Predictability. when performed together. 1 and 2 (the latter being Work Instructions). effectiveness. Ability 4.

Claris. management can identify ways to adjust and adapt the process to particular projects without measurable losses of quality or deviations from specifications. Level 2 . Symantec. At maturity level 5.on the face of it . Level 5 .frustrate the successful development of their software. Process Capability is established from this level. Level 3 ..Optimizing It is a characteristic of processes at this level that the focus is on continually improving process performance through both incremental and innovative technological changes/improvements.g. Apple.The CMM provides a theoretical continuum along which process maturity can be developed incrementally from one level to the next.B. but where it exists it may help to ensure that existing processes are maintained during times of stress. they are the AS-IS processes) and used to establish consistency of process performance across the organization. Software process framework . using process metrics. It has been used for and may be suited to that purpose.e. uncontrolled and reactive manner by users or events.. possibly with consistent results.Managed It is characteristic of processes at this level that. Level 4 .Initial (Chaotic) It is characteristic of processes at this level that they are (typically) undocumented and in a state of dynamic change. These standard processes are in place (i. This did not . Skipping levels is not allowed/feasible. for example. In particular. There were/are reallife examples where the CMM was arguably irrelevant to successful software development. Level 1 . to shift the mean of the process performance) to improve process performance. Though these companies may have successfully developed their software. This provides a chaotic or unstable environment for the processes. they would not necessarily have considered or defined or managed their processes as the CMM described as level 3 or above.Repeatable It is characteristic of processes at this level that some processes are repeatable. tending to be driven in an ad hoc. and Lotus. processes are concerned with addressing statistical common causes of process variation and changing the process (for example. Such firms would have included.: The CMM was originally intended as a tool to evaluate the ability of government contractors to perform a contracted software project. Microsoft. and so would have fitted level 1 or 2 of the model. but critics pointed out that process maturity according to the CMM was not necessarily mandatory for successful software development. for software development ). This would be done at the same time as maintaining the likelihood of achieving the established quantitative process-improvement objectives. Process discipline is unlikely to be rigorous. management can effectively control the AS-IS process (e. and these examples include many shrinkwrap companies (also called commercial-off-the-shelf or "COTS" firms or software package firms).Defined It is characteristic of processes at this level that there are sets of defined and documented standard processes established and subject to some degree of improvement over time. N.

For each maturity level there are five checklist types: TypeSD Description Policy Standard Describes the policy contents and KPA goals recommended by the CMM.The software process framework documented is intended to guide those wishing to assess an organization/projects consistency with the CMM. Provides an overview of an entire maturity level. Describes the recommended content of select work products described in the CMM. The level overview checklists are further refined into checklists for: • KPA purposes (Key Process Areas) • KPA Goals • policies • standards • process descriptions • procedures • training • tools • reviews and audits • work products managed and controlled • measurements Process Procedure Level overview THE CHANGE ARENA . Describes the process information content recommended by the CMM. The process checklists are further refined into checklists for: • roles • entry criteria • inputs • activities • outputs • exit criteria • reviews and audits • work products managed and controlled • measurements • documented procedures • training • tools Describes the recommended content of documented procedures described in the CMM.

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When a change is first introduced. You can see this in figure 1. This is stage 1 of the Change Curve. people's initial reaction may be shock or denial. can quickly spiral into chaos. and actively resist or protest against the changes. below. Others will correctly identify real threats to their position. as they react to the challenge to the status quo. As a result.The Change Curve: The Change Curve model describes the four stages most people go through as they adjust to change. Once the reality of the change starts to hit. . Some will wrongly fear the negative consequences of change. feel angry. people tend to react negatively and move to stage 2 of the Change Curve: They may fear the impact. the organization experiences disruption which. if not carefully managed.

and how they must adapt. and so learn the reality of what's good and not so good. at least for the people who react in this way. and accept the changes. it is much healthier to move to stage 3 of the Change Curve. They begin testing and exploring what the changes mean. They start to let go. Using the Change Curve With knowledge of the Change Curve. where pessimism and resistance give way to some optimism and acceptance. Only when people get to this stage can the organization can really start to reap the benefits of change. By stage 4. This is a stressful and unpleasant stage.For as long as people resist the change and remain at stage 2 of the Change Curve. For everyone. the change will be unsuccessful. you can plan how you'll minimize the negative impact of the change and help people adapt more quickly to it. Tip: It's easy just to think that people resist change out of sheer awkwardness and lack of vision. However you need to recognize that for some. they not only accept the changes but also start to embrace them: They rebuild their ways of working. people who've developed expertise in (or have earned a position of respect from) the old way of doing things can see their positions severely undermined by change. . as you can see in figure 2. For example. people stop focusing on what they have lost. change may affect them negatively in a very real way that you may not have foreseen. Your aim is to make the curve shallower and narrower. At stage 3 of the Change Curve.

As someone responsible for change. Here. anger.As someone introducing change. Make sure that you address these early with clear communication and support. it is often impossible to preempt everything. and increase its likelihood of success. and is on the way to making a success of the changes. this is when reality of the change hits. and by taking action to minimize and mitigate the problems that people will experience. But make sure that people know where to go for more information if they need it. They may resist the change actively or passively. and need to know how to get help. this stage is the "danger zone". They may feel the need to express their feelings and concerns. and people need to take time to adjust. the organization may descend into crisis or chaos. but also ensure that you don't overwhelm people: They'll only be able to take in a limited amount of information at a time. so make sure that you listen and watch carefully during this stage (or have mechanisms to help you do this) so you can respond to the unexpected. resentment or fear. people may be in shock or in denial. and vent their anger. and ensure that you take the time to answer any questions that come up. For the organization. This is a critical stage for communication. you can use your knowledge of the Change Curve to give individuals the information and help they need. Once you turn the corner to stage 3. This will help you accelerate change. Even if the change has been well planned and you understand what is happening. If this stage is badly managed. you should prepare for this stage by carefully considering the impacts and objections that people may have. So this stage needs careful planning and preparation. . they may start to feel concern. people need information. the organization starts to come out of the danger zone. Make sure you communicate often. Stage 3: This is the turning point for individuals and for the organization. depending on where they are on the curve. Actions at each stage are: Stage 1: At this stage. As the reaction to change is very personal and can be emotional. need to understand what is happening. Stage 2: As people start to react to the change.

can be used to assess the overall feeling of the company. The change curve can also track commitment to change. What's more. Whilst you are busy counting the benefits. CHANGE EQUATION The Formula for Change was created by Richard Beckhard and David Gleicher. Try putting up posters of the change curve in each department and ask employees to fix a spot on it to show their current mood. by helping people to adjust and enthusiastically support change as quickly as possible. • Resistance:Involve yourself in informal channels. The communicator’s task in any change process is to try to “concertina” the curve. encourage involvement. Be aware that this stage is vital for learning and acceptance. As the person managing the changes. use multiple communication forms. The feedback. and it will have certainly been at least a little uncomfortable for some people involved: Everyone deserves to share the success. you establish a track record of success: Which will make things easier the next time change is needed. and are given early opportunities to experience what the changes will bring.Individually. • Commitment:Reward behaviour change. • Exploration:Communicate timelines for the project. As someone managing the change. This formula provides a model to assess the relative strengths affecting the likely success or otherwise of organisational change programs. which is anonymous. • Denial:Maximise face-to-face communication. This requires a communication strategy for each angle of the curve. and the positive effects of change become apparent. they'll need to test and explore what the change means. build buy-in. you'll finally start to see the benefits you worked so hard for. roll-out your strategy. • Hope:Repeat and reinforce your objectives and strategy. Stage 4: This stage is the one you have been waiting for! This is where the changes start to become second nature. DxVxF>R . address the “me” issues. refined by Kathie Dannemiller and is sometimes called Gleicher's Formula. even if this is a simple matter of allowing enough time for them to do so. don't forget to celebrate success! The journey may have been rocky. and that it takes time: Don't expect people to be 100% productive during this time. and build in the contingency time so that people can learn and explore without too much pressure. you can lay good foundations for this stage by making sure that people are well trained. The change curve is a behavioral model of group and individual reactions to the process of change. Your team or organization starts to become productive and efficient. and people embrace the improvements to the way they work. as people's acceptance grows. They will do this more easily if they are helped and supported to do so. by celebrating the achievement. • Satisfaction:Listen to employees.

The Change Equation shows how to tap into the power of the diversity already in your . Because D. V = Vision of what is possible. leadership ideas. the organization must recognize and accept the dissatisfaction that exists by communicating industry trends. but it really took off when Dannemiller changed the language to make it easier to remember and use. is: C = (ABD) > X Where C is change. History The original formula. It was Kathleen Dannemiller who dusted off the formula and simplified it. concrete steps that can be taken towards the vision. B is a desired clear state. 2003) when she wrote that Gleicher started it. These factors are: D = Dissatisfaction with how things are now. If the product of these three factors is greater than R = Resistance. In addition. making it more accessible for consultants and managers. A is the status quo dissatisfaction. Beckhard and Harris promoted it. F = First. To ensure a successful change it is necessary to use influence and strategic thinking in order to create vision and identify those crucial. D is practical steps to the desired state. Then change is possible. if any one is absent or low. as created by Gleicher and authored by Beckhard and Harris.Three factors must be present for meaningful organizational change to take place. V. best practice and competitive analysis to identify the necessity for change. Paula Griffin stated it accurately (in Wheatley et al. Dannemiller and Jacobs first published the more common version of the formula in 1992 (and Jacobs. and F are multiplied. 1994). and X is the cost of the change. early steps towards it. then the product will be low and therefore not capable of overcoming the resistance.

you can't do this without them! This is where Beckhard and Harris's Change Equation can help. but I can't work out what I should be doing about it. It represented a significant shift in management thinking from the "command and control" of the industrial age to a people centric approach. chances are that you'll hear things like:” I can't believe that restructuring the sales force is really going to increase sales. Organizational change agents. In this article. "change projects" have often been driven by technology implementations or upgrades. or a layer of middle management being made redundant.organization and turn it into a "pluralistic" workplace where change is not something to resist but something to embrace. business leaders. which comprises four main themes: (1) Determining the need for change . when change looms on the horizon. and see how you can use it to roll out successful change in the future. In today's turbulent economy. He articulated a generic change framework. We need to articulate why it is unacceptable and undesirable to conduct business in the . how will you get everyone to agree with the changes you have in mind? After all. Traditionally.We must be clear why things need to change. or your bank calling in a loan. Whatever the situation.” Upgrading the system is such a disruption. for example. change is just as likely to be driven by something else: a long-established competitor unexpectedly going bust." "Our current system isn't great. the following statement must be true: Beckhard change equation An early indicator of the chances of success Historically. with business processes and working practices being changed to fit in with the new system. the Beckhard change equation can be seen as a major milestone in the field of Organisational Development in that it acknowledged the role and importance of employee involvement in change. we'll look at this equation. I just don't see why we need to go through all that work. but what's so wonderful about the new one? How will that be any better?" "I know that Corascon going under should be good news for us." With comments like these flying around. and anyone who wants to make his or her organization stronger and more competitive will find in this readable volume a wealth of practical solutions that will help any forward-looking organization thrive in the new economy. however. Richard Beckhard has long been considered one of the founders of organisation development and the creator of the core framework for a large system change. and it's still useful today. It states that for change to happen successfully. human resource managers. Explaining the Change Equation Richard Beckhard and Rubin Harris first published their change equation in 1977 in "Organizational Transitions: Managing Complex Change".

Making sure that each employee understands what they need to know what to do to prepare themselves for the change and what steps they need to take in order for this change to be successful. nobody voluntarily initiates a change in their life unless there is an actual or perceived threat to survival and / or an aspirational desire linked to a personal vision.see the diagram below.same way. . then there is no motivation to change. (4) Getting to the desired future by managing the transition . Three factors must be present for meaningful organizational change to take place. In my experience. concrete steps that can be taken towards the vision If any of these factors are missing or weak.a change model that recognises the basic psychology of change at the personal level. The change equation is expressed as Dissatisfaction x Vision x First Steps > Resistance to Change.in my opinion . (3) Assessing the present and what needs to be changed in order to move to the desired future . namely: • Dissatisfaction with the status quo • Vision of what is possible • First. (2) Articulating a desired future .using external specialist help and appropriate processes .Ensuring that your employees fully understand and can picture their future as part of a changed organisation and can see their place in the new organization. So the Beckhard change equation is . If we are not dissatisfied with the present situation. then you’re going to experience resistance.

After all. Clearly. the planned. a very broad definition of the term IT is used to include: computers of all types. much of the theory has evolved from social and business studies and not from the field of computer science. however. hardware. 1. Introduction As we approach the twenty first century there can be little doubt that successful organisations of the future must be prepared to embrace the concept of change management. The model also provides a strong and interesting framework against which to view some of the papers that follow in this theme of the book. software. The paper will examine the issues raised during a review of the change management literature – looking at the major approaches to change management. a very broad definition of the term IT is used to include: computers of all types. As in the Management In The 90s (MIT90s) study. hardware. Toffler 1983). communications networks and the integration of computing and communications technologies. communications networks and the integration of computing and communications technologies. many theorists and practitioners now believe that the rate of change that organisations are subjected to is set to increase significantly in the future. Change management has been an integral part of organisational theory and practice for a long time. is one of the major enablers of organisational change (Markus and Benjamin 1997. namely. some even go so far as to suggest that the future survival of all organisations will depend on their ability to successfully manage change (Burnes 1996. emergent and contingency approaches – as background to the issues raised in other papers in this theme of the book. The paper will then examine change management within the context of Information Systems (IS) theory and practice. ScottMorton 1991). organisational change is an important issue This paper will focus on the topic of organisational change management from an information systems perspective. Indeed. information systems do not exist in a vacuum and It is widely accepted that technology. 2. Overview of the Field . This will lead to a discussion of an emerging model by Orlikowski and Hofman which will be briefly reviewed to provide insight into the types of models which are likely to provide a focus for research in the area in the near future.Abstract This paper will focus on the topic of organisational change and its management from an information systems perspective. The paper will examine the issues raised during a review of the change management literature as background to the issues raised in other papers in this theme of the book. particularly Information Technology (IT).It could be argued that the study of organisational change management should be the preserve of the social scientist or the business manager. The successful development of any information system must address sociological issues including the effects of the system itself on the organisation into which it is introduced. However. As in the Management In The 90s (MIT90s) study (Scott-Morton 1991). Peters 1989. software. Paul (1994) maintains that information systems must be developed specifically for change as they must constantly undergo change to meet changing requirements.

the paper will investigate the fundamental characteristics of ITenabled change and will discuss how this is different to the management of change in pure social systems. networked organisations using adaptive technologies. Dawson 1994). which appeared in the 1980s (Burnes 1996). group and organisation-wide change respectively.Many of the theories and models relating to the management of organisational change have evolved from the social sciences (Burnes 1996. views change as a process of continually adapting an organisation to align with its environment. We will then briefly examine the foundations of change management theory. 1994. Orlikowski and Hofman (1997) maintain that their model is more suitable than the traditional Lewinian models for modern. a popular and practical working definition is that the environmental variables which influence organisations are political. however. emergent and contingency approaches. the Improvisational Change Model proposed by Orlikowski and Hofman (1997) will be examined in detail. Kanter 1989. However. The planned approach views the change process as moving from one fixed state to another. Bate 1994. Most theorists classify change according to the type or the rate of change required and this is often referred to as the substance of change (Dawson 1994). The aim of this section is to provide a broad overview of the substance of change and of change management. Finally. sociological and technological (Jury 1997). Bate (1994) proposes a broad definition for the . the emergent approach. In particular. Information Systems (IS) research is of course a much newer discipline. The contingency approach is a hybrid approach which advocates that there is not ‘one best way’ to manage change. Change has been classified in many different ways. Organisational change is usually required when changes occur to the environment in which an organisation operates. similarly. the planned. the three main theories that underpin the different approaches to change management are examined which concentrate on individual. There is no accepted definition of what constitutes this environment. The paper will then examine the major approaches to change management. based on the work of Lewin (1958). namely. 3 Change Management Although it has become a cliché. Specifically. Benjamin and Levinson 1993). it is nevertheless true to say that the volatile environment in which modern organisations find themselves today mean that the ability to manage change successfully has become a competitive necessity (Burnes 1996. has dominated change management theory and practice since the early 1950s. In contrast. This paper presents a discussion on the change management literature drawn from a social science perspective which is then related to an IS perspective of IT-enabled change. economical. This model is based on the same principles as the emergent approach to change management and. We will begin by giving a broad overview of change management and examining the nature of change and its applicability to the IS field. Peters and Waterman 1982). The planned approach to change. the socio-technical nature of information systems is now recognised and many of the IS theories and models have been adopted and adapted from the social sciences (Yetton et al. The paper will then examine change management within the context of Information Systems (IS) theory and practice.

amount of change which he argues may be either incremental or transformational. Bate maintains that incremental change occurs when an organisation makes a relatively minor change to its technology, processes or structure whereas transformational change occurs when radical changes programmes are implemented. Bate also argues that modern organisations are subject to continual environmental change and consequently they must constantly change to realign themselves. Although there is a general recognition for the need to successfully manage change in modern organisations, questions regarding the substance of change and how the process can be managed in today’s context remain largely unanswered. There are numerous academic frameworks available in the management literature that seek to explain the issues related to organisational change and many of these frameworks remain firmly rooted in the work of Lewin (1958). Dawson (1994) points out that, almost without exception, contemporary management texts uncritically adopt Lewin’s 3-stage model of planned change and that this approach is now taught on most modern management courses. This planned (Lewinian) approach to organisational change is examined in detail later in the paper. Information systems are inherently socio-technical systems and, therefore, many of the theories and frameworks espoused by the social sciences for the management of change have been adopted by the IS community. Consequently, even the most modern models for managing IT-enabled change are also based on the Lewinian model (Benjamin and Levinson 1993). Figure 1 depicts the most popular and prominent models for understanding organisational change which are examined in detail in later sections of this paper. These models will be subsequently be compared with the main change management models adopted by the IS community. Change Management Planned Approach Emergent Approach Contingency Approach Contextualist Processual Principal Change Management Models 4 Theoretical Foundations Change management theories and practice originate from different, diverse, social science disciplines and traditions. Consequently, change management does not have clear and distinct boundaries and the task of tracing its origins and concepts is extremely difficult. This section will briefly examine the foundations of change management theory as these foundations underpin later discussions concerning the most prominent models for understanding organisational change. Whatever form change takes and whatever the required outcomes of any change initiative, managers responsible for implementing change must address the management issues at either an individual,group or organisational level. It may also be argued that a successful change programme must address the management issues at all levels. Three of the main theories upon which change management theorystands are: the individual, group dynamics and the open systems perspectives which are summarised inthe remainder of this section. The Individual Perspective The individual perspective school is divided into two factions know as the Behaviourists and the Gestalt-Field psychologists. Behaviourists believe that behaviour is caused by an

individual’s interaction with the environment. The basic principle of this approach, which originates from Pavlov’s (1927) work, is that human actions are conditioned by their expected consequences. Put simply, this means that rewarded behaviour is repeated while ignored behaviour tends not to be repeated. GestaltField protagonists, however, believe that behaviour is not just caused by external stimuli, but that it arises from how an individual uses reason to interpret these stimuli. Behaviourists attempt to effect organisational change by modifying the external stimuli acting upon the individual whereas Gestalt-Field theorists seek to change individual self-awareness to promote behavioural and thus organisational change. The Group Dynamics Perspective Group dynamics theorists believe that the focus of change should be at the group or team level and that it is ineffectual to concentrate on individuals to bring about change as they will be pressured by the group to conform. The group dynamics school has been influential in developing the theory and practice of change management and of all the schools they have the longest history (Schein 1969). Lewin (1958) maintains that the emphasis on effecting organisational change should be through targeting group behaviour rather than individual behaviour since people in organisations work in groups and, therefore, individual behaviour must be seen, modified or changed to align with the prevailing values, attitudes and norms (culture) of the group. The group dynamics perspective manifests itself as the modern management trend for organisations to view themselves as teams rather than merely as a collection of individuals. The Open Systems Perspective Proponents of the open systems perspective believe that the focus of change should be neither on the individual nor on the group but that it should be on the entire organisation (Burnes 1996). Organisations are viewed as a collection of interconnected sub-systems and the open systems approach is based on analysing these sub-systems to determine how to improve the overall functioning of the organisation. The sub-systems are regarded as open because they interact not only internally with each other but also with the external environment. Therefore, internal changes to one sub-system affect other sub-systems which in turn impact on the external environment (Buckley 1968). The open systems perspective focuses on achieving overall synergy rather than on optimising any one individual sub-system (Mullins 1989). Burke (1980) maintains that this holistic approach to understanding organisations is reflected in an different approach to change management which is driven by three major factors: interdependent subsystems, training and management style. An organisation's sub-systems are regarded as interdependent and Burke argues that change cannot occur in one sub-system in isolation without considering the implications for the other sub-systems. He also argues that training cannot achieve organisational change alone as it concentrates on the individual and not the organisational level. Burke also maintains that modern organisations must adopt a consultative management approach rather than the more prevalent controlling style epitomized by Taylor’s (1911) famous work. The Planned Approach

Much of the literature relating to the planned approach to organisational change is drawn from Organisational Development (OD) practice and numerous OD protagonists have developed models and techniques as an aid to understanding the process of change (Dawson 1994). The origins of most of the developments in this field can be traced to the work of Lewin (1958) who developed the highly influential Action Research and ThreePhase Models of planned change which are summarised in the remainder of this section. The action research model Lewin (1958) first developed the Action Research (AR) model as a planned and collective approach to solving social and organisational problems. The theoretical foundations of AR lie in Gestalt-Field and Group Dynamics theory. Burnes (1996) maintains that this model was based on the basic premise that an effective approach to solving organisational problems must involve rational, systematic analysis of the issues in question. AR overcomes “paralysis through analysis” (Peters and Waterman 1982: 221) as it emphasises that successful action is based on identifying alternative solutions, evaluating the alternatives, choosing the optimum solution and, finally, that change is achieved by taking collective action and implementing the solution. The AR approach advocates the use of a change agent and focuses on the organisation, often represented by senior management. The AR approach also focuses on the individuals affected by the proposed change. Data related to the proposed change is collected by all the groups involved and is iteratively analysed to solve any problems. Although the AR approach emphasizes group collaboration, Burnes (1996) argues that cooperation alone is not always enough and that there must also be a ‘feltneed’ by all the participants. The three-phase model Lewin’s ubiquitous Three-Phase model (1958) is a highly influential model that underpins many of the change management models and techniques today (Burnes 1996; Dawson 1994). The main thrust of this model is that an understanding of the critical steps in the change process will increase the probability of successfully managing change. Lewin (1958) also argues that any improvement in group or individual performance could be prone to regression unless active measures are take to institutionalise the improved performance level. Any subsequent behavioural or performance change must involve the three-phases of unfreezing the present level, moving to a new level and re-freezing at the new level. Lewin (1958) argues that there are two opposing sets of forces within any social system; these are the driving forces that promote change and the resisting forces that maintain the status quo. Therefore, to unfreeze the system the strength of these forces must be adjusted accordingly. In practice the emphasis of OD practitioners has been to provide data to unfreeze the system by reducing the resisting forces (Dawson 1994). Once these negative forces are reduced the organisation is moved towards the desired state through the implementation of the new system. Finally, re-freezing occurs through a program of positive reinforcement to internalise new attitudes and behaviour. Burnes (1996) argues that this model merely represents a logical extension to the AR model as unfreezing and moving respectively equate to the research and action phases of the AR

model. Lewin’s Three-Phase model of planned change has since been extended by numerous theorists to enhance its practical application including the Lippitt et al.'s (1958) seven-phase model and the Cummings and Huse (1989) eight-phase model. All these models are based on the planned approach to change management and, according to Cummings and Huse (1989), they all share one fundamental concept: “the concept of planned change implies that an organisation exists in different states at different times and that planned movement can occur from one state to another". The implications of this concept are that an understanding of planned organisational change cannot be gained by simply understanding the processes which bring about change, it is also necessary to understand the states that an organisation passes through before attaining the desired future state (Burnes 1996). The Emergent Approach Within the social sciences, an approach described by Burnes (1996) as the emergent approach is a popular contemporary alternative to the planned approach to the management of change. The emergent approach was popularised in the 1980s and includes what other theorists have described as processual or contextualist perspectives (Dawson 1994). However, these perspectives share the common rationale that change cannot and should not be ‘frozen’ nor should it be viewed as a linear sequence of events within a given time period as it is with a planned approach. In contrast, with an emergent approach, change is viewed as a continuous process. The modern business environment is widely acknowledged to be dynamic and uncertain and consequently, theorists such as Wilson (1992) and Dawson (1994) have challenged the appropriateness of a planned approach to change management. They advocate that the unpredictable nature of change is best viewed as a process which is affected by the interaction of certain variables (depending on the particular theorist’s perspective) and the organisation. Dawson (1994) proposed an emergent approach based on a processual perspective which he argues is not prescriptive but is analytical and is thus better able to achieve a broad understanding of change management within a complex environment. Put simply, advocates of the processual perspective maintain that there cannot be a prescription for managing change due to the unique temporal and contextual factors affecting individual organisations. Dawson succinctly summarises this perspective,saying that “change needs to be managed as an ongoing and dynamic process and not a single reaction to adverse contingent circumstance”.(Dawson 1994:182). For advocates of the emergent approach it is the uncertainty of the external environment which makes the planned approach inappropriate. They argue that rapid and constant changes in the external environment require appropriate responses from organisations which in turn force them to develop an understanding of their strategy, structure, systems, people, style and culture and how these can affect the change process (Dawson 1994; Pettigrew and Whipp 1993; Wilson 1992). This has in turn led to a requirement for a ‘bottom-up’ approach to planning and implementing change within an organisation. The rapid rate and amount of environmental change has prevented senior managers from effectively monitoring the business environment to decide upon appropriate organisational responses. Pettigrew and Whipp (1993) maintain that emergent change involves linking action by people at all levels of a business. Therefore, with an emergent

A contingency approach has been taken by Dunphy and Stace (1993) who proposed a model of organisational change strategies and developed methods to place an organisation within that model. they also showed that there was more than ‘one best way’ to do this. nevertheless. Perhaps more importantly. this approach requires the consent of those affected by change it is only through their behaviour that organisational structures. This approach adopts the perspective that an organisation is ‘contingent’ on the situational variables it faces and therefore. In short. some common themes that relate them all. Although British theorists acknowledge that contingency theory has contributed significantly to organisational design theory. within North America and Australia a rational model of change based on a contingency perspective has prevailed therefore this section will briefly discuss this approach (Dawson 1994). Change is a continuous process aimed at aligning an organisation with its environment and it is best achieved through many small-scale incremental changes which. For example an organisation facing constant and significant environmental changes may find an emergent approach to change management more appropriate than a planned approach. The resultant continuum can be seen in Figure 2: ENVIRONMENT APPROACHES TO CHANGE Stable Turbulent Planned Emergent The Change Management Continuum (from Burnes 1996: 197) Contingency theory is a rejection of the ‘one best way’ approach taken by the majority of change management protagonists. Bate 1994). the basic tenet of the contingency approach to change management is that there is no ‘one best way’ to change. the responsibility for organisational change is devolved and managers must take a more enabling rather than controlling approach to managing. Furthermore. It can be argued that the planned and emergent approaches to change management are equally valid but that they apply to different organisational circumstances. . The Contingency Approach Burns and Stalker (1961) established a contingent relationship between an organisation and its environment and the need to adapt to that environment.approach to change. Dunphy and Stace (1993) maintain that their model reconciles the opposing views of the planned and emergent theoretical protagonists. they do not acknowledge that it has had the same impact on change management theory (Burnes 1996. over time. can amount to a major organisational transformation. technologies and processes move from abstract concepts to concrete realities (Burnes 1996). In contrast to both the planned and the emergent approaches to change management. However. a model of change could embrace a number of approaches with the most suitable approach being determined by the organisation's individual environment. Although the proponents of emergent change may have different perspectives there are. organisations must adopt the most appropriate change management approach.

They also argue that the effective implementation of IT is. in the specific form of IT. economic. Woodward’s (1965) study demonstrated the need to take into account technological variables when designing organisations and this gave credibility to the argument for technological determinism which implies that organisational structure is ‘determined’ by the form of the technology. Nonetheless. despite this criticism. Some projects. McKersie and Walton 1991). the requirement for an organisation to change is generally caused by changes in its environmental variables which many academics and practitioners agree are political. The Management In The 1990s (MIT90) program (Scott Morton 1991) proposed a framework for understanding the interactions between the forces involved in IT-enabled organisational change. Scott-Morton 1991). Markus and Benjamin (1997) attribute this to what they describe as the magic bullet theory of IT whereby IT specialists erroneously believe in the magic power of IT to create organisational transformation. namely technology. at its core. Some academics argue that although IT is an enabling technology it cannot by itself create organisational change (Markus and Benjamin 1997. This section will focus on one of these environmental variables. sociological and technological (Jury 1997. They argue that IT can be used deliberately to modify an organisation's strategy and also that the MIT90s framework is a static model that does not address the dynamic nature of change. a task of managing change.IT-Enabled Organisational Change Previous sections of this paper have dealt with the different approaches to managing organisational change taken from a social science perspective. However. and will examine the major issues that are particular to ITenabled change. many IT-enabled change projects have failed for nontechnical reasons. A simplified adaptation of this framework Structure Processes Skills & Roles Strategy IT External Technological Environment External Socioeconomic Environment Adapted From The MIT90s Framework (Scott-Morton 1991) Proponents of the MIT90s model maintain that to successfully manage IT-enabled change it is necessary to ensure that the organisational choices. In contrast however. Regardless of which model is adopted. such as the London Ambulance Service Computer Aided Dispatch System have failed with fatal consequences (Benyon-Davies 1995). the technology and the strategic choices depicted in Figure 2. (1994) challenge the view that the critical issue in managing IT successfully is alignment.the MIT90s study has been highly influential . McKersie and Walton (1991) maintain that to create IT-enabled organisational change it is necessary to actively manage the changes. despitethe general acceptance that the application of change management techniques can considerably increase the probability of a project’s success.3 are properly aligned (Scott-Morton 1991). Yetton et al.

However. jobs and organisational control processes change radically. The MIT90s study concluded that the benefits of IT are not generallybeing realised by organisations because investment is biased towards technology and not towards managing changes in organisational processes. Benjamin and Levinson (1993) maintain that IT-enabled change is different from change which isdriven by other environmental concerns. Orlikowski and Hofman’s Improvisational Change Model A key example of this type of model is presented by Orlikowski and Hofman (1997). 1994. This framework is typical of many IS change models (Orlikowski and Hofman 1997) which have been adopted and adapted from the social sciences and are based on the Lewinian unfreeze.to IS academics and practitioners (Yetton et al. in a situation reminiscent of the developments within the social sciences. Clearly. Benjamin and Levinson 1993). They maintain that IT-enabled change managers should take as a model the Trukese navigator who begins with an objective rather than a plan and responds to conditions as they arise in an ad-hoc fashion. Ives and Jarvenpaa (1994) provide a vision of the affect of IT-enabled changes on basic work methods as organisations become global networked organisations to take advantage of collaborative work methods. Mintzberg (1987) first made the distinction between deliberate and emergent strategies and Orlikowski (1996) argues that the perspectives which have influenced . The study concluded by demonstrating the critical role of situated change enacted by organisational members using groupware technology over time. Many academics and practitioners would agree that IT-enabled change is different from more general change processes and that change must be managed to be successful (Yetton et al. Zuboff (1988) also described the revolutionary changes in jobs and controlprocesses within organisations that take full advantage of IT as workers become ‘informated’ and thus empowered. They argue that skills. IT-enabled changes also span across functions and organisations as technology enables increased inter and intra-organisational coordination with decreased transaction costs (Kalakota and Whinston 1996). One such model is Benjamin and Levinson’s (1993) which draws on the general change management literature to develop a framework for managing IT-enabledchange. The model also provides a strong and interesting framework against which to view some of the papers that follow in this theme of the book. 1994. Theirs is an improvisational model for managing technological change which is an alternative to the predominantLewinian models. The origins of Orlikowski and Hofman’s (1997) Improvisational Change Model can be found in a study by Orlikowski (1996) which examined the use of new IT within one organisation over a two year period. the change process must be understood to be managed and a number of models have been proposed for this. We will review this model here to provide insight into the types of models which are likely to provide a focus for research in the area in the near future.Benjamin and Levinson 1993). This is similar to the arguments of the proponents of the emergent change management approach which were examined earlier in this paper. a number of new IT-enabled change management models are now emerging which are based on the emergent or contingent approaches tochange management. structure and culture. They also argue that traditional Lewinian change models are based on the fallacious assumption that change occurs only during a specified period whereas they maintain that change is now a constant. change and re-freeze approach to change management discussed previously.

as companies gain experience with the World Wide Web they may deliberately respond to unexpected opportunities to leverage its capabilities. For example the implementation of e-mail that accomplishes its intended aim of facilitating improved communications. The first of these enabling conditions is that dedicated resources must be allocated to provide ongoing support for the change process which Orlikowski and Hofman (1997) maintain is inherently continuous. For example the use of e-mail as an informal grapevine for disseminating rumours throughout an organisation. that changes associated with technology implementations constitute an ongoing process rather than an event with an end point after which an organisation can return to a state of equilibrium. that every technological and organisational change associated with the ongoing process cannot be anticipated in advance. Orlikowski and Hofman (1997) have identified three different types of change: · Anticipated Change. Model assumptions and types of change Orlikowski and Hofman’s (1997) Improvisational Change Model is based on two major assumptions. Critical enabling conditions Orlikowski and Hofman (1997) suggest that there are certain enabling conditions which must be fulfilled to allow their Improvisational Change Model to be successfully adopted for implementing technology within an organisation.studies of IT-enabled organisational change have similarly neglected emergent change. Opportunity-Based changes are not originally anticipated but are intentionally introduced during the ongoing change process in response to an unexpected opportunity. Anticipated changes are planned ahead of time and occur as intended. Orlikowski challenges the arguments that organisational change must be planned. They also argue that practical change management using the Improvisational Change Model requires a set of processes and mechanisms to recognise the different types of change as they occur and to respond effectively to them. they contend that the three types of change usually build iteratively on each other in an undefined order over time. Orlikowski and Hofman (1997) maintain that both anticipated and opportunity-based changes involve deliberate action in contrast to emergent changes which arise spontaneously and usually tacitly from organisational members’ actions over time. · Opportunity-Based Change. that technology is the primary cause of technology-based organisational transformation and that radical changes always occur rapidly and discontinuously. For example. Furthermore. the technology and the change model as depicted Aligning the Key Change Dimensions (from Orlikowski and Hofman 1997: 18) . · Emergent Change. First. In contrast. Second. They also suggest that another enabling condition is the interdependent relationship between the organisation. Emergent changes arise spontaneously from local innovation and that are not originally anticipated or intended. Based on these assumptions. she maintains that organisational transformation is an ongoing improvisation enacted by organisational actors trying to make sense of and act coherently in the world.

Orlikowski and Hofman’s (1997) Improvisational Change Model is a first attempt at moving thisresearch theme forward and it is an area which is likely to grow in importance over the next few years. Orlikowski and Hofman appear to share similar views to the contingency theorists discussed earlier as they do not subscribe to the view that there is ‘one best way’ for managing IT-enabled change. ITenabled change is different from changes driven by other environmental concerns and the . Their research also suggested that an Improvisation Change Model may only be appropriate for introducing open-ended technology into organisations with adaptive cultures. group dynamics and the open systems perspectives. upon which Orlikowski and Hofman’s (1997) Improvisational Change Model is based. The main theories that provide the foundation for general change management approaches are the individual. therefore. In contrast. The contingency approach adopts the perspective that an organisation is‘contingent’ on the situational variables it faces and. This is often attributable to the misconception that IT is not only an enabling technology but that it can also create organisational change. The highly influential MIT90s framework is useful for understanding the interactions between the forces involved in IT-enabled organisational change which must be aligned to create successful organisations. The rationale of the newer emergent approach is that change should not be ‘frozen’ or viewed as a linear sequence of events but that it should be viewed as an ongoing process. it must adopt the most appropriate change management approach. They maintain that open-ended technology is typically used in different ways across an organisation. Many IT-enabled change projects fail despite the general acceptance that change management can considerably increase the probability of a project’s success. the newer emergent approach to change management focuses on the organisation as an open system with its objective being to continually realign the organisation with its changing external environment. concluded that further empirical research was needed to determine the extent to which an improvisational perspective of organisational change is useful in other contexts and how differentorganisational and technological conditions influence the improvisations attempted and implemented. change and re-freeze model. The planned approach to change management tends to concentrate on changing the behaviour of individuals and groups through participation.Lewin’s (1958) model is a highly influential planned approach model that underpins many of the change management models and techniques today and most contemporary management texts adopt this 3-phase unfreeze.Orlikowski and Hofman’s (1997) research suggested that the interaction between these key change dimensions must ideally be aligned or at least not in opposition. Contingency theory is a rejection of the ‘one best way’ approach taken by planned and emergent protagonists. IS research is relatively much newer and the socio-technical nature of information systems has caused most IS theories and models to be adapted from the social sciences. Summary The dominant theories and models relating to the management of change have evolved from the social sciences. Orlikowski’s (1996) research. Openended technology is defined by them as technology which is locally adaptable by end users with customizable features and the ability to create new applications.

process must be understood to be managed. which are inside of the people. self-image.opportunity-based and emergent changes. Knowledge (Knowledge): refers to individuals get factual information and empirical in a particular field 2. . values and self-image. 5. But the behavior and performance of the staff plays a key role. skill (Skill): refers to the structured use of the knowledge capacity to perform a specific job. Both anticipated and opportunity-based changes involve deliberate action in contrast to emergent changes which arise spontaneously and usually tacitly from organisational actors’ actions over time. Trait: The sustained response of physical characteristics and a variety of information on the environment. Orlikowski and Hofman (1997) suggest that the critical enabling conditions which must be fulfilled to allow their Improvisational Change Model to be successfully adopted for implementing technology are aligning the key dimensions of change and allocating dedicated resources to provide ongoing support for the change process. social role (Social Roles): means a person’s behavior based on attitudes and values. in a situation reminiscent of the developments within the social sciences. ” Among them. However. a number of new IT-enabled change management models are now emerging which are based on the emergent or contingent approaches to change management. many IS change models have adopted and adapted the Lewinian unfreeze. the “top of the above section. character and motivation. namely. anticipated. self-concept (Self-Concept): refers to a person’s attitudes. 3. American psychologist McClelland proposed a famous model called icebery model in 1973.the so-called “Iceberg model” is to staff the different quality of the performance of the individual tables into the surface “over part of the iceberg” and hidden ” The following part of the iceberg. It is easy to understand and measure the part. which is the external performance. some difficulty to measure. you need a technology and know-how required for the situation of a particular area . ways and style 4. Quality and motivation of individuals can predict the work under the supervision of the state in the long term. They are not easy to change through the outside influence. Based on these assumptions Orlikowski and Hofman (1997) have identified three different types of change. The six dimensions of people’s quality 1. Orlikowski and Hofman (1997) have proposed an improvisational model for managing technological change as one alternative to the predominant Lewinian models. which is also relatively easy to change through training and development. Consequently. and The following section includes social roles. This improvisational model is based on the assumptions that technological changes constitute an ongoing process and that every change associated with the ongoing process cannot be anticipated beforehand. change and re-freeze approach to change management. These three types of change build iteratively on each other in an undefined order over time. and provides a developing research perspective against which to view the issues discussed by the other authors. The review of models of change presented in this paper provides background for the following papers in this theme. namely.” including basic knowledge and basic skills.

below the surface of the water there are two more dimensions of C.Power and Politics M. influence). he saw it as a dump box for urges.M. processes) just scratches the surface. and what kind of Implementation M. Topography of Mind: Freud’s Iceberg Model for Unconscious. there are three levels of consciousness: • conscious (small): this is the part of the mind that holds what you 抮 e aware of.Change Management Iceberg Software (Strategic The Change Management Iceberg of Wilfried Kr�ger is a strong visualization of what is arguably the essence of change in organizations: dealing with barriers. feelings and ideas that are tied to anxiety. and implementation M. Material passes easily back and forth between the conscious and the preconscious.hard things "only" (information systems. So although things stored here aren 抰 in the conscious. conflict and pain.6. What kind of barriers arise. Material from these two areas can slip into the unconscious.the kind of C. • preconscious (small-medium): this is ordinary memory. According to Kr�ger many C. • Only 10% of an iceberg is visible (conscious) whereas the other 90% is beneath the water (preconscious and unconscious). . affinity. In part. exerting influence on our actions and our conscious awareness. Ego. managers only consider the top of the iceberg: Cost. is consequently needed. depends on: . These feelings and thoughts have not disappeared and according to Freud. Pre-conscious. & Conscious According to Freud. However. Quality and Time ("Issue Management"). • unconscious (enormous): Freud felt that this part of the mind was not directly accessible to awareness. This is where most of the work of the Id. Truly unconscious material cant� be made available voluntarily. • The Preconscious is allotted approximately 10% -15% whereas the Unconscious is allotted an overwhelming 75%-80%. they can be readily brought into conscious. Change Management Iceberg Software Tool . You need a psychoanalyst to do this! Iceberg metaphor for the mind 抯 layout: We can use the metaphor of an iceberg to help us in understanding Freud’s topographical theory. .: . of Perceptions and Beliefs. according to Freud. guide and determine a person’s external action. You can verablize about your conscious experience and you can think about it in a logical fashion. they will drive. they are there. and . and Superego take place. Motives: refers to a specific area of natural and sustainable ideas and preferences (such as achievement.

Here M.Potential Promoters have a generic positive attitude towards C. on a superficial level ("Opportunists")..the applied C. of Perceptions and Beliefs to change their minds as far as possible. mindsets and capabilities) is much more profound .soft things also (values.revolutionary. .Hidden Opponents have a negative generic attitude towards C. and will therefore support it.Opponents have both a negative general attitude towards C. AND are positive about this particular C. .Promoters on the other hand have both a positive generic attitude towards C. dramatic change as in Business Process Reengineering . for them personally. incremental change as in Kaizen Below the surface of the CM Iceberg: . They take advantage of the C. . although they seem to be supporting the C.) is needed to change their attitude. seems to be appropriate in this case. . They need to be controlled by M. COACHING SKILL WILL . AND a negative behaviour towards this particular personal C. however for certain reasons they are not convinced (yet) about this particular C. Power and Politics M. of Perceptions and Beliefs supported by information (Issue M. strategy .evolutionary.

Excite. .. and have then remained relatively uninvolved or 'hands-off'. it is critical to match your style of interaction with the player's readiness for the task.. The Skill/Will Matrix will help you do this.Why Skill/Will Matrix? If you assigned a task to someone and the job does not quite get done well enough... Sustain the will.. you just ended up demotivating him/her. Consequently... whether you are managing. Guide.... or leading. Supervise closely with tight control and clear rules/deadlines. Details on Applying the Skill / Will Matrix Direct Build the will Develop a vision of future performance Identify motivations Provide clear briefing Build the skill. or coaching. Modern Management: 12 Breakthrough Ideas Source: Harvard Economic Review Executive summary by Anastasia Bibikova. Delegate... or You may have been too directive or 'hands-on' with a capable person who was quite able to complete the assignment with little assistance from you. one of the most likely reasons is that: You have delegated the task to someone who is unwilling – or unable – to complete the job.

Since most coaching techniques rely on the employees skills and their will to accomplish a goal. skill and contains some coaching techniques to utilize based on where the associate falls. that others feel this enthusiasm as well. the level of training they have received. In the real world. As you can see. asking effective questionsand providing feedback. and yourself. 10 Roles of an Inspirational Leader Coach and train your people to greatness. Coaching is the key to unlocking the potential of your people..The best ideas related to the practice of management. debate them and let them inspire your own thinking!. You must train and coach your people to enhance their learning ability and performance. The High Low Matrix can help managers overcome one of the more challenging aspects of their role which is understanding what motivates their employees. It increases your effectiveness as a leader. 8. your organization. don’t try to repeat. or the type of task itself. The Use of Giving Alms: There is no use giving alms to those who need assistance. people have many different motivations. the High Low Matrix coaching model is a punet square of an employee's will vs. Their level of skill can often depend on their experience.. Why should you be too much compassionate to people who are just looking for 2-3 “coaching” words to find their own way/ solution?. This knowledge will help you to better craft your approach with your employees and teams to get the best results possible from each individual. people also have different levels of skill sets for particular tasks. As a coach. It's easy to assume that because you are motivated by knowing you did a good job or by making an impact on your environment. . Empowermentalone is not enough. it is important to understand how these two aspects work together. Let's start by introducing the High Low Matrix. Simply consider them. If you know somebody has used them. you must help your people grow and achieve more by inspiring them. Find the right combination of instructor-led training and coaching follow-ups to achieve success. In turn.

you may be expecting great leaps. Again. In order to effectively apply coaching techniques to this type of employee. yet as much as they want it. but is experiencing a will issue that is apparent in their performance. Advising is focused on providing the skills necessary to turn the employee's motivation into success.Let's get into further detail about how to use this coaching model and discuss each of the coaching techniques to use once we've identified where our employee falls on the High Low Matrix. If tasks that are not skill related are still delivered in a less than stellar fashion or their attitude has taken a change recently. utilizing the IGROW Model will help you to identify what has occurred or changed and impacted . you may be faced with an employee who has the necessary skill set to deliver and perhaps has delivered great results in the past. High Low Matrix Coaching Model: Motivate At the other end of the spectrum. Again. First. the Advise phase of the High Low Matrix coaching model should be applied. to determine the exact skill that the associate is struggling with that has caused the poor performance. You have no doubt seen results from your employee or team that do not meet your expectations and therefore have determined a change must be made. it is key that you continually give the employee praise and endorsement for their improvements. high willed employee. the IGROW Model is recommended. High Low Matrix Coaching Model: Advise Are you faced with an employee that is highly motivated. Now that you have determined both the employee's skill level and their will level. Assessing their skill is typically a much simpler task as it is likely why you are here. how do we identify if an employee is exhibiting or feeling a high degree of will? This should be somewhat obvious from how they approach their work. it is time to discuss the coaching techniques that you should apply based on where the employee falls in the High Low Matrix coaching model. you can infer that the associate's motivation has slipped. you will leverage the employee's desire and provide them with the necessary tools to improve. Utilizing the IGROW Model will help you to determine the root causes for any changes in behavior. Throughout the learning process. By focusing on teaching or training the skill. Remember. but even baby steps deserve some positive reinforcement. they just can't seem to deliver the results needed? This is your low skilled. Skipping this valuable step could result in a backslide in will and you'll then have a whole other set of challenges to deal with.

you may wonder why we are discussing their development? Many schools of thought tell us to always focus on bringing up our bottom performers. focus on them. This can be done as simply as by asking what they take the most pride in at work or how they like to be recognized for a job well done. Once you have determined their hot buttons. Whenever the employee does deliver. You will first need to provide the employee with the tools to develop their skills. high willed employees are likely your future leaders. the Direct coaching technique should be utilized. High Low Matrix Coaching Model: Delegate The last type of employee is the high skilled. When faced with an employee who lacks the will there are some key areas to focus on while trying to re-engage the employee. This coaching model will also help you determine if your approach should be one of Coaching vs. They are a motivating force for themselves and typically for your team. High Low Matrix Coaching Model: Direct For situations that involve a low skilled and low willed employee. Because the employee is not delivering results there can often be a challenge with their confidence level that is inhibiting their ability to apply new or existing skills. use your new found knowledge to show your appreciation. If they are succeeding. This does not mean that the tools you provide. Counseling. Next you should determine if there are any road blocks or constraints that the employee is experiencing. This is one of the better coaching techniques to apply with this type of employee. Start by determining what the employee's 'hot buttons' or motivators are. These are typically your top performers that consistently provide results and strive to do a good job. Many managers use this technique not for development but as a way to reduce their work load or stress by shoving the work onto . and will result in a confidence building experience for them. such as training. Giving the employee low risk opportunities to practice their skills and to succeed.their level of motivation. the two key areas to focus on are training and praising. high willed employee. Since this employee is not very skilled and is not very motivated. Delegating is often misused in the business world today. but can offer reinforcement to information they have already been presented with. Often times removing these road blocks or providing options. utilizing the Delegate coaching technique can help them to develop to the next level. Since these high skilled. can alleviate their challenges with motivation. and this often times leaves a lack of focus on our top performers. have to be new information to them. Directing is focused on a combination of the previously discussed coaching techniques applied together. will give you the ability to provide them with the positive feedback they need.

. and what options you may want to offer. be sure to spend time prior to your coaching session thinking about where the associate falls. You should not be using this technique as a means to reduce your workload as you will be working through the task with your high performer. It has been defined as "the specific collection of values and norms that are shared by people and groups in an organization and that control the way they interact with each other and with stakeholders outside the organization. CULTURE LEVEL BY SCHEIN Organizational culture is an idea in the field of organizational studies and management which describes the psychology. This will continue to instill a sense of ownership in them. also called as "beliefs and ideas about what kinds of goals members of an organization should pursue and ideas about the appropriate kinds or standards of behavior organizational members should use to achieve these goals. From organizational values develop organizational norms. but what most managers don't do is follow up on the opportunities they've delegated to others or provide them with the tools or resources to succeed. Strong culture is said to exist where staff respond to stimulus because of their alignment to organizational values. Being prepared for the discussion will make a great difference. As we have discussed. To ensure you are successful in your approach. Delegation."[1] This definition continues to explain organizational values. strong cultures help firms operate like well-oiled machines. This is not always a bad thing. guidelines. or expectations that prescribe appropriate kinds of behavior by employees in particular situations and control the behavior of organizational members towards one another. In such environments. each scenario you are faced with requires a different approach or coaching technique to achieve the desired results. Giving your highly motivated top performers the opportunity to be challenged and to continue to learn will ensure they continue to be your highly motivated top performers. attitudes. cruising along with outstanding execution and perhaps minor tweaking of existing procedures here and there. While delegating you should also focus on praising and endorsing what they do well as well as offering them opportunities to either make decisions or to collaborate on decisions being made.their team. will often take more time than just doing the task yourself. helping them to learn and master it. This is how development through delegation works. beliefs and values (personal and cultural values) of an organization. what motivates them. experiences. when used effectively.

and vice versa[citation needed]." This is a state where people.000 of IBM's employees in different parts of the world. Some are described below: Hofstede (1980[2]) demonstrated that there are national and regional cultural groupings that affect the behavior of organizations. or alternatively act predominantly as a member of the group or organization.. or where there is an evangelical belief in the organization’s values. Uncertainty avoidance reflects the extent to which a society accepts uncertainty and risk. recent researches have shown that high individualism may not necessarily mean low collectivism. where there is heavy reliance on a central charismatic figure in the organization. for example. and refers to the extent to which people are expected to stand up for themselves.Conversely. even if they have different ideas. Some people and cultures might have both high individualism and high collectivism. Janis. A high score suggests that there is an expectation that some individuals wield larger amounts of power than others. in almost every group. do not challenge organizational thinking. A low score reflects the view that all people should have equal rights. In fact group think is very common. Innovative organizations need individuals who are prepared to challenge the status quo— be it group-think or bureaucracy. Hofstede identified five dimensions of culture in his study of national influences: Power distance . Individualism vs. it happens all the time.. Several methods have been used to classify organizational culture. Members that are defiant are often turned down or seen as a negative influence by the rest of the group. Research indicates that the two concepts are actually unrelated. Where culture is strong—people do things because they believe it is the right thing to do —there is a risk of another phenomenon. there is weak culture where there is little alignment with organizational values and control must be exercised through extensive procedures and bureaucracy. and also need procedures to implement new ideas effectively. He defined it as ". when members' strive for unanimity override their motivation to realistically appraise alternatives of action. However. This could occur. Groupthink. and therefore there is a reduced capacity for innovative thoughts. in an attempt to find aspects of culture that might influence business behavior.The degree to which a society expects there to be differences in the levels of power.a quick and easy way to refer to a mode of thinking that people engage when they are deeply involved in a cohesive in-group. because they bring conflict. collectivism . or also in groups where a friendly climate is at the base of their identity (avoidance of conflict). Hofstede looked for national differences between over 100. "Groupthink" was described by Irving L.individualism is contrasted with collectivism. for .

Power derives from expertise as long as a team requires expertise. who are highly skilled and specialist in their own markets of experience. swift decisions can ensue. which is ideal in. Power and influence spread out from a central figure or group. In a Role Culture. these organizations form hierarchical bureaucracies.refers to the value placed on traditionally male or female values. He describes Harrison's four types thus: a Power Culture which concentrates power among a few. These cultures often feature the multiple reporting lines of a matrix structure. such as oil prospecting or military aviation. Control radiates from the center like a web. ambition. people have clearly delegated authorities within a highly defined structure. Male values for example include competitiveness. they do produce consistent results.In relation to its feedback this would mean a quick response and also measured organizations in ition. public services. Survival can become difficult for such organizations.  The Process Culture occurs in organizations where there is little or no feedback. Someone who highly values duty to his or her group does not necessarily give a low priority to personal freedom and self-sufficiency Masculinity vs. for example. Power Cultures have few rules and little bureaucracy. Typically. Power desires from the top person and personal relationships with that individual matters more than any formal title of position. roles descriptions and authority definitions. By contrast. This is often associated with bureaucracies. since the concept of an organization suggests that a group of like-minded individuals pursue the . People become bogged down with how things are done not with what is to be achieved. in a Task Culture. Predictable and consistent systems and procedures are highly valued. A Person Culture exists where all individuals believe themselves superior to the organization.example. It is all a small team approach. assertiveness. Controlled by procedures. femininity . While it is easy to criticize these cultures for being overly cautious or bogged down in red tape. Power derives from a person's position and little scope exists for expert power. teams are formed to solve particular problems. and the accumulation of wealth and material possessions Deal and Kennedy Deal and Kennedy defined organizational culture as the way things get done around here. Charles Handy Charles Handy[4] (1985) popularized the 1972 work of Roger Harrison of looking at culture which some scholars have used to link organizational structure to organizational culture.

described by three cognitive levels of organizational culture. an organization can profess highly aesthetic and moral standards . The next level deals with the professed culture of an organization's members .organizational goals. and feel in relation to those problems"(Schein. Edgar Schein Edgar Schein. Those with sufficient experience to understand this deepest level of organizational culture usually become acclimatized to its attributes over time.collectively known as artifacts. Included are the facilities. and even company slogans. Notably. Additionally. that has worked well enough to be considered valid and. His organizational model illuminates culture from the standpoint of the observer. the organization's tacit assumptions are found.[5] an MIT Sloan School of Management professor. Many of these 'unspoken rules' exist without the conscious knowledge of the membership. culture is the most difficult organizational attribute to change. mission statements and other operational creeds.the values. Organizational behavior at this level usually can be studied by interviewing the organization's membership and using questionnaires to gather attitudes about organizational membership. understanding paradoxical organizational behaviors becomes more apparent. 2004. culture at this level is the underlying and driving element often missed by organizational behaviorists. outlasting organizational products. local and personal values are widely expressed within the organization. At the first and most cursory level of Schein's model is organizational attributes that can be seen. defines organizational culture as: "A pattern of shared basic assumptions that was learned by a group as it solved its problems of external adaptation and internal integration. furnishings. to be taught to new members as the correct way you perceive. visible awards and recognition. p. For instance. Using Schein's model. the way that its members dress. At the third and deepest level. think. how each person visibly interacts with each other and with organizational outsiders. therefore. these are the elements of culture which are often taboo to discuss inside the organization. 17). At this level. According to Schein. thus reinforcing the invisibility of their existence. services. because each partner brings a particular expertise and clientele to the firm. offices. These are the elements of culture that are unseen and not cognitively identified in everyday interactions between organizational members. Surveys and casual interviews with organizational members cannot draw out these attributes—rather much more in-depth means is required to first identify then understand organizational culture at this level. Some professional partnerships can operate as person cultures. felt and heard by the uninitiated observer . founders and leadership and all other physical attributes of the organization.

The Organizational Culture Inventory measures twelve behavioral of norms that are grouped into three general types of cultures: •Constructive Cultures. and self-actualization. Merely understanding culture at the deepest level may be insufficient to institute cultural change because the dynamics of interpersonal relationships (often under threatening conditions) are added to the dynamics of organizational culture while attempts are made to institute desired change Robert A. PhD. esteem. Superficially. defines culture as the behaviors that members believe are required to fit in and meet expectations within their organization. organizational rewards can imply one organizational norm but at the deepest level imply something completely different. in which members are expected to approach tasks in forceful ways to protect their status and security. It also explains why organizational change agents usually fail to achieve their goals: underlying tacit cultural norms are generally not understood before would-be change agents begin their actions. The Constructive Cluster The Constructive Cluster includes cultural norms that reflect expectations for members to interact with others and approach tasks in ways that will help them meet their higher order satisfaction needs for affiliation. Cooke. •Passive/Defensive Cultures. The four cultural norms in this cluster are: •Achievement •Self-Actualizing •Humanistic-Encouraging •Affiliative . Cooke The Organizational Culture Inventory: Culture Clusters Robert A. in which members are encouraged to interact with people and approach tasks in ways that help them meet their higher-order satisfaction needs. •Aggressive/Defensive Cultures. in which members believe they must interact with people in ways that will not threaten their own security. This insight offers an understanding of the difficulty that organizational newcomers have in assimilating organizational culture and why it takes time to become acclimatized.at the second level of Schein's model while simultaneously displaying curiously opposing behavior at the third and deepest level of culture.

creativity is valued over conformity. and effectiveness is judged at the system level rather than the component level. satisfaction. The four Passive/Defensive cultural norms are: •Approval •Conventional •Dependent •Avoidance In organizations with Passive/Defensive cultures. service quality. Passive/Defensive cultures experience a lot of unresolved conflict and turnover. The Aggressive/Defensive Cluster The Aggressive/Defensive Cluster includes cultural norms that reflect expectations for members to approach tasks in ways that protect their status and security. resulting in high levels of motivation. and organizational members report lower levels of motivation and satisfaction.Organizations with Constructive cultures encourage members to work to their full potential. re-engineering. The Passive/Defensive Cluster Norms that reflect expectations for members to interact with people in ways that will not threaten their own security are in the Passive/Defensive Cluster. total quality management. The Aggressive/Defensive cultural norms are: •Oppositional •Power •Competitive . transformational leadership. cooperation is believed to lead to better results than competition. Constructive norms are evident in environments where quality is valued over quantity. ideas. and sales growth. teamwork. These types of cultural norms are consistent with (and supportive of) the objectives behind empowerment. and judgment. and learning organizations. continuous improvement. People are expected to please others (particularly superiors) and avoid interpersonal conflict. Rules. and orders are more important than personal beliefs. members feel pressured to think and behave in ways that are inconsistent with the way they believe they should in order to be effective. procedures.

These organizations emphasize finding errors. controlled. G.” and encouraging members to compete against each other rather than competitors. which may exploit the very rituals that generate stories which may not be true. and organizational culture. Rituals and Routines: Management meetings. Power Structures: Who makes the decisions. and the way that work flows through the business.•Perfectionistic Organizations with Aggressive/Defensive cultures encourage or require members to appear competent. identifying a number of elements that can be used to describe or influence Organizational Culture:        The Paradigm: What the organization is about. its values. group process consultation. These elements may overlap. its mission. Schein's organizational culture model . Stories and Myths: build up about people and events. including career development. Organizational Structures: Reporting lines. hierarchies. Role cultures would have vast rulebooks. and superior. or concede their position are viewed as incompetent or weak. Members who seek assistance. Edgar Henry Schein (born 1928). board reports and so on may become more habitual than necessary. what it does. Control Systems: The processes in place to monitor what is going on. a professor at the MIT Sloan School of Management. and convey a message about what is valued within the organization. Power structures may depend on control systems. The short-term gains associated with these strategies are often at the expense of long-term growth. admit shortcomings. has made a notable mark on the field of organizational development in many areas. but also extend to symbols of power such as parking spaces and executive washrooms. He is generally credited [by whom?] with inventing the term "corporate culture”. weeding out “mistakes. There would be more reliance on individualism in a power culture. how widely spread is power. Johnson[6] described a cultural web. and on what is power based? Symbols: These include organizational logos and designs.

Coercive persuasion Schein has written on the issues surrounding coercive persuasion. Schein (2004) identifies three distinct levels in organizational cultures: Artifacts and behaviors Espoused values Assumptions The three levels refer to the layers of corporate culture. leadership of the organization . One can easily change the products. Assumptions are the actual values that the culture represents. office jokes. These assumptions are typically so well integrated in the office dynamic that they are hard to recognize from within. furniture. not necessarily correlated to the values. such as the Raz update of Schein's organizational culture model (2006). Examples of this would be employee professionalism. Artifacts include any tangible or verbally identifiable elements in an organization. Values are the organization's stated or desired cultural elements. dress code. and others. The model has undergone various modifications. and history all exemplify organizational artifacts. comparing and contrasting brainwashing as a use for "goals that we deplore and goals that we accept. This is most often[citation needed] a written or stated tone that the CEO or President hope to exude throughout the office environment. or a "family first" mantra. services. Architecture. According to Edgar Schein organizational culture is the residue of success of any organization.Illustration of Schein's model of organizational culture Schein's model of organizational culture originated in the 1980s.

but it is difficult to change the organisational culture. uniform or dress of the members and interaction of members within themselves and also with outsiders. structural stability. mission statements and different operational creeds. The organization culture can be described in three cognitive levels by the viewpoint of an observer. furnishings. These unspoken rules prove their existence by influencing the culture of the organization. Even surveys and casual interviews are not helpful in determining the culture but more indepth knowledge of the organization helps in identifying and understanding the organization culture at this level and helps in safety of the business. The next level includes the culture of the business organization that can be depicted by company slogans. integration and patterning. As that will initiate the common thoughts and ideas of the individuals of the members to work in one direction for achieving the goal. traditions. The organization culture helps in effective communication of the members of the company at every level and this can be achieved by group activities of the members of the company. anxiety provoking and time consuming as the culture is deep seated and complex so its very hard to know about the assumptions. The basic underlying assumptions act as cognitive defense mechanism for both individuals and groups that is difficult. rituals. The model helps to know the culture in the organization at different levels. awards and recognition. The large organizations face the difficulty of subculture development and integration of newcomers like during any mergers one should create a new culture for growth and success of the company. Organizations and culture problems with solutions Culture of an organization is the customs and rights of an organization that include behavior patterns. Organizational norms are something different at the deepest level that is why its bit difficult for a newcomer to adjust in a new organization and it is the only reason for the failure of the organizational agents as they cultural norms of the organization are not understood by them completely before action. The leaders should behave marginally for organization culture so as to learn some new ways of culture and member psychology. The behavior of members in the organization can be reviewed by interviewing the members as well as by using questionnaires to gather the attitude of organization members. Good Schein organizational culture should be developed so as to give a safe and ethical environment to the employee. Along with in-depth knowledge of the culture the interpersonal relationship between the members also play an important role in understanding the dynamics of Schein organizational culture. The third level includes the tacit assumptions of the organization that are whether unseen but these elements influence the daily interaction between the members of the organization. The first level of organization include the facilities. By the development and new innovation one can just have good culture in the . Importance of culture and model By this model one can easily understand the paradoxical organizational behaviors.

publicly announced values. developed. Formal Philosophy: mission . Understand new environment and culture before change or observation can be made. and changed.organization that will help the group in making its presence felt both national and international. Observe behavior: language. Some achieve greatness. • • • • • Culture a phenomenon that surrounds us all. developed by professors Robert Quinn and Kim Cameron. managed. manipulated. embedded. customs. Organizational Culture & Leadership by Edgar H Schein "Some are born great. Good managers must work from a more anthropological model. Defining Organizational Culture Culture is customs and rights. and traditions Groups norms: standards and values Espoused values: published. Culture helps us understand how it is created. Understand the culture to understand the organization. Culture defines leadership. And some have greatness thrust upon 'em" Oct 1997 OCAIonline (Organizational culture assessment instrument online) a hassle-free tool for diagnosing organizational culture. Each org has its own way and an outsider brings his/her baggage as observer.

irrational Org with history has culture. and feel in relation to those problems. Culture is the accumulated shared learning from shared history. traditions. . Culture implies structural stability and Patterning and integration. Culture Formally Defined A pattern of shared basic assumptions that the group learned as it solved its problems of external adaptation and internal integration that has worked well enough to be considered valid and. behavior patterns. Shared meanings of the group Metaphors or symbols: Culture: norms. Internal integration that permits functioning and adapting. values. 2 problems all groups must deal with: 1. acting. Survival. to be taught to new members as the correct way you perceive. Summary Culture explains incomprehensible. Once culture exists it determines criteria of leadership. The problem of socialization: teaching newcomers The problem of behavior: Can a large org have one culture? Subcultures. and adaptation in environment 2. rituals. paradigms: Shared knowledge for socialization. Not every group develops a culture. think. therefore. growth.Rules of the Game: rules to all in org Climate: climate of group in interaction Embedded skills: Habits of thinking.

Initially started by founder. stories Easy to observe Difficult to decipher Symbols are ambiguous Problems in classification Espoused Values All group learning reflects original values Those who prevail influence group: the leaders First begins as shared value then becomes shared assumption Social validation happens with shared learning. manners of address. myths. Hypothesis becomes reality To learn something new requires resurrection. Levels of Culture Artifacts on surface sees hears feels visible products Language technology Products Creations Style: clothing.Leaders should be conscious of culture otherwise it will manage them. leader and then assimilated. Basic Assumptions Evolve as solution to problem is repeated over and over again. reexamination. frame breaking Culture defines us: What we pay attention to .

What things mean React emotionally What actions to take when Humans need cognitive stability Defense mechanisms McGregor: if people are treated consistently in terms of certain basic assumptions. Third party may help solve differences between 2 cultures Each new member comes with own assumptions. Lurk for awhile to understand culture. Key is he looked at these two with his eyes. Dimensions of Culture External Environments Develop a model of how assumptions arise and persist Identify issues groups faced from origin of group. his culture. Different cultures make different assumptions about others based on own values etc: see them with our eyes not theirs. One can best understand a system best by trying to change it. Group growth and culture formation are intertwined. they come eventually to behave according to those assumptions in order to make their world stable and predictable. not theirs. if possible. Essential elements: Mission and strategy Goals . Culture of 2 orgs Case study of 2 distinct companies illustrating multilevel analysis of culture.

Means of developing consensus. Goals can be ambiguous. Goals to achieve consensus on goals group needs shared language and shared assumptions. Mission can be timeless. What is the function? Can be multifunctional. technology. Means to Achieve Goals Need clear consensus on means to achieve goals. Means: Design of tasks Division of labor Org structure Reward and incentive system Control system Info systems Skills. If in debate mission is reached then culture has developed. and knowledge acquired to cope become part of culture of org Lack of consensus on who owns can cause difficulty . but goals must have end point Do not confuse assumptions of goals with assumptions of mission. Culture exists when members share identity and mission. reaching goals Measurement Correction Mission and strategy Each new group must develop shared concept to survive. but not how to achieve them.

property.Be aware of feelings about territory. stability and patterns are in place." Consensus on means creates behavioral regularities Once regularities in place. because it may question culture: mission. turf Crowding is a problem Changing is difficult because of internal "property. Summary Culture is multidimensional. Major Internal Issues: Common Language Group boundaries for inclusion or exclusion . multifaceted. Measuring results Need consensus on how to evaluate self From top Trust self Use outsider Trust hard data Correction. Repair Consensus needed on how to affect change Change may be for growth not just to solve a problem Correctiveness can have great effect on culture. Culture reflects group's efforts to cope and learn. Managing Internal Integration External is important but so is internal relationships.

gesture.Distributing power and status Developing norms of intimacy. friendship. and authority be allocated? All need to have some power or know limits Who will grant power? Power can be earned . and speech.... Orgs can have three dimensions: Lateral movement: from one task to the next Vertical movement: from one rank to the next Exclusionary: from outsider to insider As org ages becomes more complex: Indiv may belong to many levels. depts. but group tests it. Leader usually sets this. Groups Boundaries Consensus of who is in and who is out. Often creators create common language Common understanding begins with categories of action. Distribution of Power and Status How will influence. power. and love Rewards and punishments Explaining the unexplainable: ideology and religion Common Language To function as group must have common language Conflict arises when two parties assume about the other without communicating.

natural disaster Religion can provide this Ideology too Myths. Human Nature. general. legends help Summary Every group must learn to be a group. Groups must reach consensus Reality. Space. Activity. The deeper issues: Nature of reality and truth Nature of time Nature of space Nature of human nature Nature of human activity Nature of human relationships . Truth. Time.Or assigned Developing Rules How to deal with authority and with peer We use family model in new situations Allocating Reward and Punishment Must have system of sanctions for obeying and disobeying rules. Explaining the Unexplainable Facing issues not under control: weather. Relationships Develop shared assumptions about more abstract. deeper issues. stories.

meanings can vary. events have clear universal meanings High = mutual casualty culture. moral system. Revealed dogma: wisdom based on trust in the authority of wise men. High Context/Low Context Low = unidirectional culture. Individual reality is self learned knowledge.Nature of reality and truth What is real and how to determine reality Levels of Reality External reality refers to that which is determined empirically. but this truth may not be shared by others. formal leaders. borders on pure dogma What is Information? *to test for reality a group must determine what is information. categories can change Moralism-Pragmatism Pragmatist seeks validation in self Moralist seeks validation in a general philosophy. events understood only in context. or kings. or tradition. it has always been this way. *Different bases for what is true: p 102 Pure dogma: based on tradition. Western tradition. by objective tests. ie SAT Social reality when groups reaches consensus on things. experience. Truth derived by a "rational-legal" process Truth as that which survives conflict and debate Truth as that which works: let's try it and test it Truth as established by scientific method. . prophets.

34 large *annually. successes **Future always with vision. Temporal Symmetry and Pacing *subtle how activities are paced Time imposes social order . monthly. Discretionary Time Horizons *deals with size and units. ie research people would not get closure. Kill two birds with one stone.. lost time never found again. late.*Information or data Nature of time *Time is a fundamental symbolic category that we use for talking about the orderliness of social life. fixed. weekly. Process world. monochronic. *length of time depended on work to be done. *developmental time is limitless. *Time: not enough. present. daily.. future Gettysburg Address **Only present counts for immediacy **Past exists to show past glories. ideas Monochromic and Polychromic Time *monochromic one thing at a time *polychromic several things done simultaneously. too much at one. Basic Time Orientation *past. as long as needed. on-. *differ by function and occupation and by rank. closure. Planning Time and development Time *planning time is linear. classes=44 minutes. hourly. open ended. quarterly.

touch. taken for granted. duration. bow to *deferring reinforces hierarchical relationship Nature of human nature . soft voice **social distance 4'-7' near. 2'-4' too far. 6"-18" too far **personal distance 18"-30" near.Pacing. symbolic Time is critical because it is so invisible. *decorating one's office *design of space reflects much Body Language *use of gestures. 7'-12' too far. sequence. *we use partitions. walls. etc *intrusion distance Symbols of Space *who has what and how much *size may determine rank. sound barriers. body position *who do you sit next to. Nature of space Comes to have symbolic meanings Distance and Relative Placement *has both physical and social meaning **intimacy distance touching. >25' too far. **public distance 12'-25' near. avoid. rhythms of life. *feelings about distance have biological roots.

*focus' on task. let's do something. on efficiency.What are our basic instincts? What is inhuman behavior? Good or bad intrinsic or learned? Self is compartmentalized: work. family. Nature of human activity How humans act in relation to their environment The Doing Orientation *controlled by manipulation *pragmatic orientation toward the nature of reality *belief in human perfectibility **getting things done. on discovery *id with Prometheus *id with Athena = task *id with Zeus = building useful political relationships The Being Orientation *nature is powerful *humanity is subservient *kind of fatalism Cannot influence nature . leisure Maslow's basic needs Human nature is complex and malleable Changes in life cycle as humans mature Humans can learn new things.

rules. hierarchy And intimacy. and productive Must solve problems of power. *id with Apollo which emphasizes hierarchy. love. and personal concepts *in one work is primary *in another family is primary *in another self-interest is primary *in another integrated life-style is possible Organization/Environment Relations *can nature be subjugated *nature harmonized with *does group view itself capable of dominating nature *or coexisting with nature Nature of human relationships Make group safe. family. influence. peer relationship Individual and Groupism .Become accepting and enjoy what one has *think in terms of adapting Being-in-Becoming Orientation *harmony with nature *develop own capacity to achieve perfect union with the environment *focus on what person is rather than what can be accomplished. comfortable. clear roles Activity Orientation and Role Definition *nature of work and the relationships between work.

*individual competitive *cooperative: group more important than indiv *hierarchy and tradition Participation and Involvement Etzioni's theories: Coercive systems Members are alienated Exit if can Peer relationship develops as defense v authority Unions develop Utilitarian systems Will participate Evolve work groups Incentive system Systems based on goal consensus between leaders and followers Morally involved Identify with org Evolve around tasks in support of org At a more specific level Autocratic Paternalistic Consultative/democratic Participative and power sharing .

Orgs do not form spontaneously or accidentally. values. and assumptions brought by new members Impact of founder most important. and assumptions of founders Learning experiences of group members New beliefs. values. Founder brings in one or more people and creates core group.Delegative Abdicative Characteristics of Role Relationships Parsons: Emotionally charged or emotionally neutral Diffuse or specific: like family or salesperson Universalistic or particularistic: broad or specific criteria Ascription or achievement oriented: family connections or accomplishments Self or collectively oriented Culture is not only deep it is wide and complex. The process of culture formation is the process of creating a small group: Single person (founder) has idea. How Leaders Create Org Cultures Mysterious: how does it happen? Culture Beginnings and the Impact of Founders as Leaders Spring from three sources: Beliefs. Culture comes to cover all aspects of life. . They share vision and believe in the risk.

and control on a regular basis? Organization design and structure How leaders react to critical incidents and organizational crises. by doing. Organizational rites and rituals Deliberate role modeling.Founding group acts in concert. Things tried out are leader imposed teaching. Smithfield started things and then left them to the members. How Founders/Leaders Embed and Transmit Culture Leader assumptions are "taught" to the group. Murphy of Action: Total consensus had to be met. Open office landscape. teaching. and coaching . work space. How do leaders get their ideas implemented? Socialization Charisma Acting. Jones an example of "visible management" Culture does not survive if the main culture carriers depart and if bulk of members leave. Others are brought in and a history is begun.. Organizational systems and procedures Observed criteria by which leaders allocate scarce resources. raises money.. measure. exuding confidence Culture-Embedding Mechanisms Primary Embedding Mechanisms Secondary Articulation and Reinforcement Mechanisms What leaders pay attention to.

Return to Culture-Embedding Mechanisms Table What Leaders Pay Attention to.Design of physical space. Stories. Return to Culture-Embedding Mechanisms Table Leader Reactions to Critical Incidents and Organizational Crises . and creed. Formal statements of organizational philosophy. and excommunicate organizational members. select. Measure. legends. Important what they do not react to. facades. Consistency more important than intensity of attention. What is noticed? Comments made Casual questions and remarks Becomes powerful if leader sees it and is consistent If leader is unaware and inconsistent then confusion can ensue. and buildings Observed criteria by which leaders allocate rewards and status. Attention is focused in part by the kinds of questions that leaders ask and how they set the agendas for meetings Emotional reactions. promote. Observed criteria by which leaders recruit. and Control What leader systematically pays attention to communicates major beliefs. retire. Primary Embedding Mechanisms called "climate" of the organization "Climate" precedes existence of a group culture. values. and myths about people and events.

Return to Culture-Embedding Mechanisms Table Observed Criteria for Resource Allocation How budgets are created reveals leader assumption. tests leader. Crisis heightens anxiety. What is acceptable financial risk? How much of what is decided is all inclusive? bottom up? top down? Return to Culture-Embedding Mechanisms Table Deliberate Role Modeling. . and what is defined by leader Crisis about leader. what happens as opposed to what is written or said? If something is to be learned their must be a reward system setup to insure it. working procedures. which motivates new learning. performance appraisals. Crises are especially important in culture creation. Video tape is good Informal messages are very powerful.In crisis: how do they deal with it? Creates new norms. Teaching. A crisis is what is perceived to be a crisis. and Coaching Own visible behavior has great value for communicating assumptions and values to others. Actual practice. and discussions with the boss. values. What is rewarded or punished is a message. Return to Culture-Embedding Mechanisms Table Observed Criteria for Allocation of Rewards and Status Members learn from their own experience with promotions. insubordination. reveals important underlying assumptions.

Once an org stabilizes these become primary and constrain future leaders. not culture creators. Return to Culture-Embedding Mechanisms Table Secondary Articulation and Reinforcement Mechanisms In young org design. architecture. Retirement. Founders have strong ideas about how to organize Build a tight hierarchy that is highly centralized. After a while these will become the driving forces for next generation. When org is in developmental stage. structure. Promotion. stories.Return to Culture-Embedding Mechanisms Table Observed Criteria for Recruitment. Selection. and Excommunication Adding new members is very telling because it is unconsciously done. and formal statements are cultural rein forcers. Return to Culture-Embedding Mechanisms Table Organization Design and Structure Organizing org has more passion than logic. the leader is driving force. Strength in people so decentralized Negotiated solutions (Murphy) How stable structure should be is variable. rituals. These secondary mechanisms will become primary in Midlife or mature orgs. Also who doesn't get promoted says something. Some stick to original setup Some constantly rework Design . These are cultural artifacts that are highly visible but hard to interpret.

Facades. Group’s members seek this kind of order They formalize the process of "paying attention. They can be powerful rein forcers too. monthly. quarterly. annually. Return to Culture-Embedding Mechanisms Table Rites and Rituals of the Organization Rites and rituals may be central in deciphering as well as communicating the cultural assumptions. Return to Culture-Embedding Mechanisms Table Design of Physical Space. They are only views of a limited portion of org so be careful." Systems and procedures give consistency Inconsistency allows for subcultures. Return to Culture-Embedding Mechanisms Table Organizational Systems and Procedures Routines most visible parts of life in org: daily. weekly. and Buildings Visible features Symbolic purposes May convey philosophy Open office means openness Return to Culture-Embedding Mechanisms Table .Some articulate why this way Some not aware of why this way Structure and design can be used to reinforce leaders assumptions.

" Like the Soviet version. they integrate hundreds of examples of these initiatives into a basically new concept of how . they believe this one is being driven largely by politicians and bureaucrats who. In this book. under great fiscal pressure.REINVENTING GOVERNMENT OSBORNE Osborne and Gaebler argue that a revolutionary restructuring of the public sector is under way — an "American Perestroika. are introducing market forces into monopolistic government enterprises.

Rather. especially that of James Q. pursuing productivity-enhancing technologies. most government agencies are bound by civil service rules and other Progressive era reforms designed to control costs. This concept is organized into ten chapters. "Hierarchical. The authors build on the work of a handful of political scientists who have studied bureaucratic reform efforts.government should function. they must be coupled with "the warmth and caring of families and neighborhoods and communities. but to see that they're provided")." they write. 2) empower communities to solve their own problems rather than simply deliver services. 3) encourage competition rather than monopolies. knowledge-intensive society and economy of the 1990s. 6) meet the needs of the customer. not the bureaucracy. informationrich. 8) invest in preventing problems rather than curing crises. reflecting the ten operating principles that distinguish a new "entrepreneurial" form of government. whose 1989 book Bureaucracylaid out key elements of what they call "a new paradigm. even under the most structured circumstances. "it is not government's obligation to provide services." They conclude that entrepreneurial governments must embrace both markets and community as they begin to shift away from administrative bureaucracies. Suffering from the same rigidities. not row (or as Mario Cuomo put it. unforgiving. decentralizing decision-making. and. and 10) solve problems by influencing market forces rather than creating public programs. and Peter Drucker. they insist. Markets are impersonal. markets are only half the answer. These writers all recognize that corporations suffer from bureaucratic rigidities just like governments do. 9) decentralize authority. The authors insist that this book does not offer original ideas. 5) be results-oriented by funding outcomes rather than inputs. they point out. Similarly. it is a comprehensive compilation of the ideas and experiences of innovative practitioners and activists across the country. Alvin Toffler. however." They also count Robert Reich. centralized bureaucracies designed in the 1930s or 1940s simply do not function well in the rapidly changing. 7) concentrate on earning money rather than spending it. As they point out in the acknowledgements. Too many corporations are still bound to the strict work rules and centralized command that marked the Industrial Age. Osborne and Gaebler suggest that governments should: 1) steer. the biggest influence on their thinking comes not from government but from management consultants like Thomas Peters. Edward Deming. and stressing quality and customer satisfaction. Wilson. and Harry Boyte among their chief influences. most people harbor various misconceptions and fallacies that make them equally distrustful of . and guarantee uniform service to the public. governments and businesses must transform themselves in essentially the same way: by flattening hierarchies. rather than rules. Although the implosion of the Soviet Union has put a damper on calls for more bureaucracy. As such. eliminate patronage. and that the structures of both are rooted in bygone eras. 4) be driven by missions. Osborne and Gaebler are careful to point out that while much of what is discussed in the book could be summed up under the category of market-oriented government. The search for a “third way” somewhere between socialism and capitalism is to the modern era what the search for the philosopher’s stone was to the Dark Ages. inequitable.

fully free markets. all aimed at changing the entire focus of government. yet another pair of would-be alchemists has set out in search of that elusive goal big-government order without the big government. some bad. or utilize different government firms in competition with each other. “Reinventing Government. The large bureaucracies set up to discourage corruption and abuses of power actually waste more resources through regulations and procedures than they save. The line-item budget does not permit innovation nor the flexibility needed to deal with the unforeseen. programs that succeed will be rewarded with the funds to expand. To stop a small number of crooks.” For example. Instead. They want nothing to do with “ideology. Old methods of budgeting are scrapped. Osborne and Gaebler provide anecdotal evidence of the success of “entrepreneurial government. . notwhat governments do. Only in the case of so-called natural monopolies such as utilities-should government be the sole provider. the book is a proverbial grab bag of policy prescriptions some good. In the course of the book’s eleven chapters. but to set policy.” Rather. the problems that America presently faces are all a result of the reforms of the Progressive Era.” Thus. Osborne and Gaebler contend. Arizona. In Reinventing Government. The old way of thinking envisions a government that identifies problems and then introduces an agency or program to solve the problem. Entrepreneurial government identifies broad social goals.” they write. agencies are allowed great leeway within which to meet the goals. is not actually to deliver services. but bereft of bureaucracy and its attendant red tape and inefficiency. Instead of being burdened with hierarchies and rules. from the standpoint of what governments do.” That is. governments can contract out to private providers. The result has been a plethora of large bureaucracies and programs targeted at specific problems but achieving no real success. The civil service system is replaced with a system that rewards innovation and holds employees responsible for failure to meet goals. Osborne and Gaebler outline a series of sweeping reforms. Osborne and Gaebler are technocrats in search of pragmatic answers. Furthermore. government that is active. The purpose of government. The result has been a decrease of 4. Osborne and Gaebler lay the foundations for what they call “entrepreneurial government. David Osborne and Ted Gaebler attempt to chart a course between big government and laissez faire. Such a policy encourages failure. Programs that fail can be weeded out over time.5 percent a year in solid-waste costs. in Phoenix. the practice of throwing more money into programs that do not work must end. They call it steering rather than rowing. In order to deliver services. the city-owned garbage collection firm competes on an equal footing with several private firms. bureaucracy must tie the hands of honest employees. utilize government providers in competition with private firms. So. In Osborne and Gaebler’s paradigm. “addresses how governments work.

however. thanks to a system of public school choice. It is a classic method of entrepreneurial governance: active government without bureaucratic government. Peter Senge and the learning organization . etc. Economic intervention. D. East Harlem. Osborne and Gaebler’s attempt to make entrepreneurial government an end rather than a means is misguided. the residents were given control over their own housing project. This is despite the dire economic conditions that prevail in the district. term limits. The public good is inevitably overproduced and resources misallocated. In either case.” The problem with Osborne and Gaebler’s analysis is its short-sighted empirical framework. Still. Thus. The planners only have two choices: They can send resources to where they think they are needed. decisions concerning resource allocation will still be politically motivated not economically motivated. Government intervention is the problem. Of course. Bureaucracy is not the problem. When it replaces the bureaucracies of old. In the Kenilworth-Parkside development in Washington. Eventually. the “customers” are partially subsidized by non-customers. structuring “is a way of using public leverage to shape private decisions to achieve collective goals. with programs tailored to meet the tastes of different students. As Osborne and Gaebler note. or they can send resources to where already overestimated customer demand is greatest.). “entrepreneurial government” is even worse when applied to areas already relatively free of government intervention. Most “entrepreneurial government” schemes still leave a gap between those who consume a service and those who pay for it. with control of programs exercised at the lowest possible level. Only specific groups. Even with the political reforms Osborne and Gaebler mention (campaign finance reform. They wrote their own bylaws and took charge of making repairs. The result is that the demand for the service is greater than it would be if the customers had to pay the full price. “Entrepreneurial government” can only delay the inevitable. whether performed by a bureaucracy or an “entrepreneurial government” will always result in inefficiency.C. In their preoccupation with finding whatever solution will “work. When policy planners structure the market. “entrepreneurial government” is indeed an improvement. the residents started their own adult education program and created a fund to help finance business ventures taken on by enterprising residents. The costs are spread over a broad tax base.Another example is the East Harlem school system. Students can choose between different schools (some located within the same building) operating independently. the effects must be temporary. Osborne and Gaebler seek a decentralized government. Resources flow into areas in which they otherwise would not.” they ignore basic principles of how human beings behave and how markets operate. has some of the most successful public schools in America.. actually receive the service. “Entrepreneurial government” seeks to “structure” the market. they change the incentive system. Laissez faire is the solution. inefficiency will result.

His areas of special interest are said to focus on decentralizing the role of leadership in organizations so as to enhance the capacity of all people to work productively toward common goals. Said to be a rather unassuming man. integrating. One of the interesting aspects of the Center (and linked to the theme of idealistic pragmatism) has been its ability to attract corporate sponsorship to fund pilot programmes that carry within them relatively idealistic concerns. . He is also founding chair of the Society for Organizational Learning (SoL). Peter M. Senge (1947. a Cambridgebased. it was Peter Senge’s 1990 book The Fifth Discipline that brought him firmly into the limelight and popularized the concept of the ‘learning organization'. On this page we explore Peter Senge’s vision of the learning organization. Harvard Business Reviewidentified it as one of the seminal management books of the past 75 years. and implementing ‘theories and practices for the interdependent development of people and their institutions’. more than a million copies have been sold and in 1997. At the same time he has been able to mediate these so that they can be worked on and applied by people in very different forms of organization. We discuss the five disciplines he sees as central to learning organizations and some issues and questions concerning the theory and practice of learning organizations. One aspect of this is Senge’s involvement in the Society for Organizational Learning (SoL). His current areas of special interest focus on decentralizing the role of leadership in organizations so as to enhance the capacity of all people to work productively toward common goals.) was named a ‘Strategist of the Century’ by the Journal of Business Strategy. researchers. Peter Senge graduated in engineering from Stanford and then went on to undertake a masters on social systems modeling at MIT (Massachusetts Institute of Technology) before completing his PhD on Management. Peter Senge describes himself as an 'idealistic pragmatist'. Peter Senge is its chair and co-founder.Peter Senge’s vision of a learning organization as a group of people who are continually enhancing their capabilities to create what they want to create has been deeply influential. Peter Senge Born in 1947. This orientation has allowed him to explore and advocate some quite ‘utopian’ and abstract ideas (especially around systems theory and the necessity of bringing human values to the workplace). he is is a senior lecturer at the Massachusetts Institute of Technology. Since its publication. and consultants’ dedicated to discovering. non-profit membership organization. one of 24 men and women who have ‘had the greatest impact on the way we conduct business today’ (September/October 1999). While he has studied how firms and organizations develop adaptive capabilities for many years at MIT (Massachusetts Institute of Technology). SoL is part of a ‘global community of corporations. We will focus on the arguments in his (1990) book The Fifth Discipline as it is here we find the most complete exposition of his thinking.

real learning gets to the heart of what it is to be human. Thus. where new and expansive patterns of thinking are nurtured. When you ask people about what it is like being part of a great team. People talk about being part of something larger than themselves. what is most striking is the meaningfulness of the experience. of being generative.Aside from writing The Fifth Discipline: The Art and Practice of The Learning Organization (1990). and where people are continually learning to see the whole together. for many. While all people have the capacity to learn. The learning organization According to Peter Senge (1990: 3) learning organizations are: …organizations where people continually expand their capacity to create the results they truly desire. organizations need to ‘discover how to tap people’s commitment and capacity to learn atall levels’ (ibid. learning that enhances our capacity to create’ (Senge 1990:14). it is argued. The Dance of Change: The Challenges to Sustaining Momentum in Learning Organizations (1999) and Schools That Learn (2000). Organizations that are continually expanding their capacity to create their future require a fundamental shift of mind among their members. Furthermore. where collective aspiration is set free. But for a learning organization. They are: Systems thinking . people may lack the tools and guiding ideas to make sense of the situations they face.: 4). Peter Senge has also co-authored a number of other books linked to the themes first developed in The Fifth Discipline. It become quite clear that. adaptive and productive will excel. We become able to re-create ourselves. “adaptive learning” must be joined by “generative learning”. ‘”Survival learning” or what is more often termed “adaptive learning” is important – indeed it is necessary. These include The Fifth Discipline Fieldbook: Strategies and Tools for Building a Learning Organization (1994). The dimension that distinguishes learning from more traditional organizations is the mastery of certain basic disciplines or ‘component technologies’. the structures in which they have to function are often not conducive to reflection and engagement. For this to happen. their experiences as part of truly great teams stand out as singular periods of life lived to the fullest. The five that Peter Senge identifies are said to be converging to innovate learning organizations. of being connected. This applies to both individuals and organizations. Some spend the rest of their lives looking for ways to recapture that spirit. (Senge 1990: 13) For Peter Senge. for a ‘learning organization it is not enough to survive. The basic rationale for such organizations is that in situations of rapid change only those that are flexible.

Classically we look to actions that produce improvements in a relatively short time span.: 12). For example. while the basic tools of systems theory are fairly straightforward they can build into sophisticated models. when viewed in systems terms short-term improvements often involve very significant long-term costs. Here is not the place to go into a detailed exploration of Senge’s presentation of systems theory (I have included some links to primers below). it is necessary to highlight one or two elements of his argument. and done in the name of management. Thus when faced with a problem. ‘concerned with a shift of mind from seeing parts to seeing wholes. Peter Senge (1990: 23) argues with regard to organizations. Systemic thinking is the conceptual cornerstone (‘The Fifth Discipline’) of his approach. It is to the disciplines that we will now turn. but can severely damage the long-term viability of anorganization. and to examine the interrelationship between the parts provides.Personal mastery Mental models Building shared vision Team learning He adds to this recognition that people are agents. Systems theory’s ability to comprehend and address the whole. Thus. from seeing people as helpless reactors to seeing them as active participants in shaping their reality. However.The Fifth Discipline provides a good introduction to the basics and uses of such theory – and the way in which it can be brought together with other theoretical devices in order to make sense of organizational questions and issues. Systems thinking – the cornerstone of the learning organization A great virtue of Peter Senge’s work is the way in which he puts systems theory to work. ‘We learn best from our experience. cutting back on research and design can bring very quick cost savings. fusing them into a coherent body of theory and practice (ibid. it is the ‘solutions’ that are close by that we focus upon. All the disciplines are. It is the discipline that integrates the others. and to fail to see organization as a dynamic process. able to act upon the structures and systems of which they are a part. a better appreciation of systems will lead to more appropriate action. We tend to think that cause and effect will be relatively near to one another. Peter Senge argues that one of the key problems with much that is written about. both the incentive and the means to integrate the disciplines. for Peter Senge. but we never directly experience the consequences of many of our most important decisions’. from reacting to the present to creating the future’ (Senge 1990: 69). is that rather simplistic frameworks are applied to what are complex systems. Part of the problem is the nature of the feedback we receive. However. First. Some of the feedback will be reinforcing (or amplifying) – with small changes building on . the argument runs. We tend to focus on the parts rather than seeing the whole. in this way.

However. and also an understanding of the place of balancing (or stabilizing) feedback. and problems with. they’re inconsequential. Senge 1990: 231). Thus. there stand four other ‘component technologies’ or disciplines. Peter Senge (1990: 92) concludes: The systems viewpoint is generally oriented toward the long-term view.: 90). of developing . Principles: guiding ideas and insights. producing more movement in the same direction. Individual learning does not guarantee organizational learning. people often have a problem ‘seeing’ systems. and problems are always caused by someone else’ Bolam and Deal 1997: 27. That’s why delays and feedback loops are so important. you can often ignore them. with more and more and still more of the same. failure to understand system dynamics can lead us into ‘cycles of blaming and self-defense: the enemy is always out there. see.themselves. also Kurt Lewin on feedback). Peter Senge advocates the use of ‘systems maps’ – diagrams that show the key elements of systems and how they connect. master and integrate into our lives. and to apply them to your organization. ‘Whatever movement occurs is amplified. A further key aspect of systems is the extent to which they inevitably involve delays – ‘interruptions in the flow of influence which make the consequences of an action occur gradually’ (ibid. Personal mastery is the discipline of continually clarifying and deepening our personal vision. A small action snowballs. also. Personal mastery. of focusing our energies. The core disciplines Alongside systems thinking. and it takes work to acquire the basic building blocks of systems theory. see the benefits in terms of cost savings. (See. we may cut our advertising budgets. ‘Organizations learn only through individuals who learn. Essences: the state of being those with high levels of mastery in the discipline (Senge 1990: 373). But without it no organizational learning occurs’ (Senge 1990: 139). such reinforcing feedback. On the other hand. A ‘discipline’ is viewed by Peter Senge as a series of principles and practices that we study. and in turn further trim spending in this area. Each is necessary to the others if organizations are to ‘learn’. They only come back to haunt you in the long term. Each discipline provides a vital dimension. The five disciplines can be approached at one of three levels: Practices: what you do. but longer term the decline in visibility may have severe penalties. resembling compound interest’ (Senge 1990: 81). In the short term. In the short run there may be little impact on people’s demands for our goods and services. An appreciation of systems will lead to recognition of the use of.

Moving the organization in the right direction entails working to transcend the sorts of internal politics and game playing that dominate traditional organizations. The discipline of mental models starts with turning the mirror inward. and of seeing reality objectively’ (ibid. It also includes the ability to carry on ‘learningful’ conversations that balance inquiry and advocacy. of black and white. They never ‘arrive’.: 203). Mental models. (Senge 1990: 142) In writing such as this we can see the appeal of Peter Senge’s vision.and –on-action. to bring them to the surface and hold them rigorously to scrutiny. Vision is vocation rather than simply just a good idea. where people expose their own thinking effectively and make that thinking open to the influence of others. although it involves them. It is not about dominance. It goes beyond competence and skills. or even pictures and images that influence how we understand the world and how we take action’ (Senge 1990: 8). It has deep echoes in the concerns of writers such as M. People with a high level of personal mastery live in a continual learning mode.: 141). It goes beyond spiritual opening. Scott Peck (1990) and Erich Fromm (1979). But personal mastery is not something you possess. a commitment to truth. their growth areas. language. ‘Entrenched mental models… thwart changes that could come from systems thinking’ (ibid. and our own power (or lack of it) with regard to them. generalizations. As such they resemble what Donald A Schön talked about as a professional’s ‘repertoire’. . Mastery is seen as a special kind of proficiency. It is a process. Peter Senge is also influenced here by Schön’s collaborator on a number of projects. Chris Argyris. a fundamental part of our task (as Schön would put it) is to develop the ability to reflect-in. thus.: 287-301). (Senge 1990: 9) If organizations are to develop a capacity to work with mental models then it will be necessary for people to learn new skills and develop new orientations.: 147-167). People with a high level of personal mastery are acutely aware of their ignorance.patience. holding creative tension (managing the gap between our vision and reality). These are ‘deeply ingrained assumptions. recognizing structural tensions and constraints. on our behaviour – and. And they are deeply self-confident. Paradoxical? Only for those who do not see the ‘journey is the reward’. We are often not that aware of the impact of such assumptions etc.: 7). and using the subconscious (ibid. their incompetence. It is a lifelong discipline. and for their to be institutional changes that foster such change. learning to unearth our internal pictures of the world. Learning organizations are localized organizations (ibid. The discipline entails developing personal vision. such as the term ‘personal mastery’ creates a misleading sense of definiteness. although it involves spiritual growth (ibid. but rather about calling. It also involves seeking to distribute business responsibly far more widely while retaining coordination and control. In other words it means fostering openness (Senge 1990: 273-286). Sometimes.

When there is a genuine vision (as opposed to the all-to-familiar ‘vision statement’). Increased clarity. When teams learn together. As it gets clearer. ‘As people talk. but developing the sorts of mental models outlined above can significantly improve matters. enthusiasm for its benefits grow’ (ibid. When dialogue is joined with systems thinking. enthusiasm and commitment rub off on others in the organization. not only can there be good results for the organization. Such a vision has the power to be uplifting – and to encourage experimentation and innovation. but because they want to. It builds on personal mastery and shared vision – but these are not enough. But many leaders have personal visions that never get translated into shared visions that galvanize an organization… What has been lacking is a discipline for translating vision into shared vision . ‘it’s the capacity to hold a share picture of the future we seek to create’ (1990: 9).: 227). it is argued. Crucially. such is the emphasis on dialogue in his work that it could almost be put alongside systems thinking as a central feature of his approach. Peter Senge starts from the position that if any one idea about leadership has inspired organizations for thousands of years. no matter how heartfelt. the vision grows clearer. Where organizations can transcend linear and grasp system thinking. Peter Senge suggests. (Senge 1990: 10) The notion of dialogue that flows through The Fifth Discipline is very heavily dependent on the work of the physicist. not because they are told to. Senge argues. there is the possibility of creating a language more suited for dealing with complexity. The practice of shared vision involves the skills of unearthing shared ‘pictures of the future’ that foster genuine commitment and enrolment rather than compliance. . Such learning is viewed as ‘the process of aligning and developing the capacities of a team to create the results its members truly desire’ (Senge 1990: 236). there is the possibility of bringing vision to fruition. David Bohm (where a group ‘becomes open to the flow of a larger intelligence’. People need to be able to act together. The discipline of team learning starts with ‘dialogue’. and thought is approached largely as collective phenomenon). In mastering this discipline. it can also foster a sense of the long-term. There are ‘limits to growth’ in this respect. (Senge 1990: 9) Visions spread because of a reinforcing process. Team learning. allowing the group to discover insights not attainable individually…. people excel and learn. members will grow more rapidly than could have occurred otherwise. the capacity of members of a team to suspend assumptions and enter into a genuine ‘thinking together’. and of focusing on deep-seated structural issues and forces rather than being diverted by questions of personality and leadership style.Building shared vision. To the Greeks dialogos meant a free-flowing if meaning through a group. something that is fundamental to the ‘fifth discipline’. Indeed. leaders learn the counter-productiveness of trying to dictate a vision. [It] also involves learning how to recognize the patterns of interaction in teams that undermine learning.not a ‘cookbook’ but a set of principles and guiding practices.

(Senge 1990: 340) Many of the qualities that Peter Senge discusses with regard to leading the learning organization can be found in the shared leadership model (discussed elsewhere on these pages). and improve shared mental models – that is they are responsible for learning…. His starting point was the ‘purpose stories’ that the managers he interviewed told about their organization. They are responsible for building organizations were people continually expand their capabilities to understand complexity. their lack of personal vision and inability to master the forces of change. what Senge approaches as inspiration.). Integrating the five component technologies is fundamental. but leadership goes beyond this. make key decisions and energize the troops as deriving from a deeply individualistic and nonsystemic worldview (1990: 340). For example. Here we will look at the three aspects of leadership that he identifies – and link his discussion with some other writers on leadership. strategies and ‘systems’ are key area of design. they were relating the story: ‘the overarching explanation of why they do what they do. Building a shared vision is crucial early on as it ‘fosters a long-term orientation and an imperative for learning’ (ibid. Peter Senge argues. Such purpose stories provide a single set of integrating ideas that give meaning to all aspects of the leader’s work – and not unexpectedly ‘the leader develops a unique relationship to his or her own personal . perhaps. and develop their mastery in the learning disciplines’ (ibid. Leader as designer. The functions of design are rarely visible. Taking this stand is the first leadership act. and how that evolution is part of something larger’ (Senge 1990: 346). However. While the notion of leader as steward is. The organization’s policies. most commonly associated with writers such as Peter Block (1993). Against this traditional view he sets a ‘new’ view of leadership that centres on ‘subtler and more important tasks’. Leader as steward. yet no one has a more sweeping influence than the designer (1990: 341). In essence. can be approached asanimation. He came to realize that the managers were doing more than telling stories. Learning organizations will remain a ‘good idea’… until people take a stand for building such organizations. stewards and teachers. ‘is based on assumptions of people’s powerlessness. At its centre the traditional view of leadership.: 344). how their organization needs to evolve. Peter Senge has some interesting insights on this strand. cit.Leading the learning organization Peter Senge argues that learning organizations require a new view of leadership. Other disciplines also need to be attended to. clarify vision. In a learning organization. vision and core values by which people should live. leaders are designers. deficits which can be remedied only by a few great leaders’ (op. ‘the leaders’ task is designing the learning processes whereby people throughout the organization can deal productively with the critical issues they face. the start of inspiring (literally ‘to breathe life into’) the vision of the learning organization. but just how they are to be approached is dependent upon the situation faced.: 345). He sees the traditional view of leaders (as special people who set the direction. the first task entails designing the governing ideas – the purpose.

“Leader as teacher” is not about “teaching” people how to achieve their vision. The concern is to identify how interventions can be made to turn organizations into ‘learning organizations’.). Telling the story in this way allows others to be involved and to help develop a vision that is both individual and shared. Leaders in learning organizations attend to all four. for example. and the ideas he promotes. Such leaders help people throughout the organization develop systemic understandings. systemic structures and the ‘purpose story’. This allows them to see ‘the big picture’ and to appreciate the structural forces that condition behaviour. Building on an existing ‘hierarchy of explanation’ leaders. It is about fostering learning. for everyone. (Senge 1990: 356) Leaders have to create and manage creative tension – especially around the gap between vision and reality. patterns of behaviour.: 356). Accepting this responsibility is the antidote to one of the most common downfalls of otherwise gifted teachers – losing their commitment to the truth. Mastery of such tension allows for a fundamental shift. ‘much of the leverage leaders can actually exert lies in helping people achieve more accurate. Peter Senge starts here with Max de Pree’s (1990) injunction that the first responsibility of a leader is to define reality. ‘but focus predominantly on purpose and systemic structure. Purpose stories evolve as they are being told. One of the important things to grasp here is that stewardship involves a commitment to. By attending to purpose. One of the issues here is that leaders often have strengths in one or two of the areas but are unable. ‘in fact. and similar theorists’ . and responsibility for the vision. can influence people’s view of reality at four levels: events. Peter Senge writes for practicing and aspiring managers and leaders. He or she becomes a steward of the vision’ (op. leaders can cultivate an understanding of what the organization (and its members) are seeking to become. more insightful and moreempowering views of reality (Senge 1990: 353). Leader as teacher. While leaders may draw inspiration and spiritual reserves from their sense of stewardship. It is not their possession. cit. but it does not mean that the leader owns it. Much of his. A key to success is being able to conceptualize insights so that they become public knowledge. their task is to manage it for the benefit of others (hence the subtitle of Block’s book – ‘Choosing service over self-interest’). It enables the leader to see the truth in changing situations. ‘open to challenge and further improvement’ (ibid. Leaders are stewards of the vision. Issues and problems When making judgements about Peter Senge’s work. Leaders learn to see their vision as part of something larger. they are as a result of being told’ (Senge 1990: 351). Peter Senge argues. By and large most managers and leaders tend to focus on the first two of these levels (and under their influence organizations do likewise). we need to place his contribution in context.vision. His is not meant to be a definitive addition to the ‘academic’ literature of organizational learning. to develop systemic understanding. Leaders have to learn to listen to other people’s vision and to change their own where necessary. Moreover they “teach” people throughout the organization to do likewise’ (Senge 1993: 353).

by and large. cit. delivering product innovation. Here we focus on three aspects. committed action on the part of those it is aimed at? This is an especially pertinent question as Peter Senge looks to promote a more holistic vision of organizations and the lives of people within them. management and distribution. The focus may well be on enhancing brand recognition and status (Klein 2001). As Leadbeater (2000: 70) has argued. Such conditions are hardly conducive to building the sort of organization that Peter Senge proposes. Within a capitalist system his vision of companies and organizations turning wholehearted to the cultivation of the learning of their members can only come into fruition in a limited number of instances. What is more. and ensuring that production and distribution costs are kept down. This process is not that easy: . The most appropriate question in respect of this contribution would seem to be whether it fosters praxis – informed. We start with the organization. developing intellectual capital and knowledge (Leadbeater 2000). (Castells 2001: 52) A failure to attend to the learning of groups and individuals in the organization spells disaster in this context. In this field some of the significant contributions have been based around studies of organizational practice. on a planetary scale. such as systems dynamics or psychological learning theory. Productivity and competitiveness are. while making use of individual case studies. Organizations need to be good at knowledge generation.efforts. which real organizations could attempt to emulate’ (Easterby-Smith and Araujo 1999: 2). British companies’ priorities are overwhelmingly financial. appropriation and exploitation. The need to focus on knowledge generation within an increasingly globalized economy does bring us back in some important respects to the people who have to create intellectual capital.). from which implications for design and implementation have been derived’ (op. they may not focus on developing the human resources that the organization houses. a function of knowledge generation and information processing: firms and territories are organized in networks of production. ‘the targets for profit are too high and time horizons too short’ (1995: xi). While those in charge of organizations will usually look in some way to the long-term growth and sustainability of their enterprise. have been ‘devoted to identifying templates. Organizational imperatives. a fundamental concern with the learning and development of employees and associates is simply too idealistic. Peter Senge. where the bottom line is profit. Here the case against Senge is that within capitalist organizations. but in the flow of knowhow that will sustain their business. Yet there are some currents running in Peter Senge’s favour. We can find very few organizations that come close to the combination of characteristics that he identifies with the learning organization. or chosen time. Here the case against Peter Senge is fairly simple. others have ‘relied more on theoretical principles. As Will Hutton (1995: 8) has argued. tends to the latter orientation. the core economic activities are global – that is they have the capacity to work as a unit in real time. companies need to invest not just in new machinery to make production more efficient.

There is. Classically. The issue here is that the people to whom it is addressed do not have the disposition or theoretical tools to follow it through. Many of us may just want to earn a living! Politics and vision. As we saw a discipline is a series of principles and practices that we study. there is a question of how Peter Senge applies systems theory. master and integrate into our lives. tacit. We are also requested to join in something bigger. independent. First. One of the biggest problems with Peter Senge’s approach is nothing to do with the theory. Knowledge carried by an individual only realizes its commercial potential when it is replicated by an organization and becomes organizational knowledge. and the social climate in which teachers work generally offers little support to those who might be disposed to face that threat’ (1975: 159). There are also psychological and social barriers. The process of exploring one’s performance.Knowledge that is visible tends to be explicit. Knowledge that is intangible. the approach entails significant effort on the part of the practitioner. the approach involves a shift from product to process (and back again). It has to be engaged with. It also entails developing quite complicated mental models. A question of sophistication and disposition. it’s rightness. While he introduces all sorts of . examination performance and school attendance) have assumed such a dominance is that alternative process approaches are much more difficult to do well. nor the way it is presented. One clue lies in his choice of ‘disciplines’ to describe the core of his approach. (ibid. talking about and embedded in organizational structures and strategies. The sort of know-how that Leadbeater is talking about here cannot be simply transmitted. and being able to apply and adapt these to different situations – often on the hoof. detachable. and the motivation to carry the task through some very uncomfortable periods. is more complex but more difficult to detach from the person who created it or the context in which it is embedded. as employees. less observable. a straightforward question concerning the vision – will people want to sign up to it? To make sense of the sorts of experiences generated and explored in a fully functioning ‘learning organization’ there needs to be ‘spiritual growth’ and the ability to locate these within some sort of framework of commitment. All this has a direct parallel within formal education. Thus. The question then becomes whether many people in organizations can handle this. it also easy for competitors to imitate. To do it we need considerable support.: 71) Here we have a very significant pressure for the fostering of ‘learning organizations’. In other words. It has to become people’s own. One of the reasons that product approaches to curriculum (as exemplified in the concern for SATs tests. We can make the same case for people in most organizations. They may be superior – but many teachers lack the sophistication to carry them forward. It calls for the integration of different aspects of our lives and experiences. less teachable. here. Here we need to note two key problem areas. personality and fundamental aims in life (and this is what Peter Senge is proposing) is a daunting task for most people. teachable. As Lawrence Stenhouse put it some years ago: ‘The close examination of one’s professional performance is personally threatening. we are not simply asked to do our jobs and to get paid.

. cit. whether business enterprise. (op. or university. (Drucker 1977: 40) If Peter Senge had attempted greater connection between the notion of the ‘learning organization’ and the ‘learning society’. There is not a consideration of questions of social justice. ‘Free enterprise’ cannot be justified as being good for business. An alternative reading is that difference is good for democratic life (and organizational life) provided that we cultivate a sense of reciprocity. hospital. social bonds are threatened’. In some ways there is link here with the concerns and interests ofcommunitarian thinkers like Amitai Etzioni (1995. It can only be justified as being good for society.broader appreciations and attends to values – his theory is not fully set in a political or moral framework. Within it (and arguably aspects of Peter Senge’s vision of the learning organization) there seems. and ways of working that encourage deliberation. and attention to this with regard to management and leadership. Second. This is would not be such a significant problem if there was a more explicit vision of the sort of society that he would like to see attained. there is sneaking suspicion that he may want to transcend it. Moral disagreement will persist – the key is whether we can learn to respect and engage with each other’s ideas. Business is not exception. Here there is a tension between the concern for dialogue and the interest in building a shared vision. 1997). To manage social impacts and social responsibilities. As Richard Sennett (1998: 143) argues with regard to political communitarianism.) He continues: None of our institutions exists by itself and as an end in itself. These are: To think through and define the specific purpose and mission of the institution. Every one is an organ of society and exists for the sake of society. and paid attention to the political and social impact of organizational activity then this area of criticism would be limited to the question of the particular vision of society and human flourishing involved. behaviours and beliefs. it ‘falsely emphasizes unity as the source of strength in a community and mistakenly fears that when conflicts arise in a community. democracy and exclusion. While Peter Senge clearly recognizes the political dimensions of organizational life. He argued that there are three tasks – ‘equally important but essentially different’ – that face the management of every organization. The search is not for the sort of common good that many communitarians seek (Guttman and Thompson 1996: 92) but rather for ways in which people may share in a common life. there is some question with regard to political processes concerning his emphasis on dialogue and shared vision. To make work productive and the worker achieving. His approach largely operates at the level of organizational interests. at times. to be a dislike of politics and a tendency to see danger in plurality and difference. As a contrast we might turn to Peter Drucker’s (1977: 36) elegant discussion of the dimensions of management.

The Fifth Discipline that integrates the other 4. or even pictures of images that influence how we understand the world and how we take action. 9) 4) "Team learning starts with dialogue. The emphases on building a shared vision. 8) 3) "Building shared vision a practice of unearthing shared pictures of the future that foster genuine commitment and enrollment rather than compliance. at least it does carry within it some questions around what might make for human flourishing." (p. the capacity of members of a team to suspend assumptions and enter into genuine thinking together.Conclusion John van Maurik (2001: 201) has suggested that Peter Senge has been ahead of his time and that his arguments are insightful and revolutionary." (p. and understanding complexity. team working. also allows us to approach a more holistic understanding of organizational life (although Peter Senge does himself stop short of asking some important questions in this respect). Beyond this. The Fifth Discipline: The Art and Practice of the Learning Organization (Senge 1990) is a book by Peter Senge (a senior lecturer at MIT) focusing on group problem solving using the systems thinking method in order to convert companies into learning organizations." (p. The Five Disciplines The five disciplines of the learning organization discussed in the book are:      1) "Personal mastery is a discipline of continually clarifying and deepening our personal vision. However. He goes on to say that it is a matter of regret ‘that more organizations have not taken his advice and have remained geared to the quick fix’. generalizations. . 7) 2) "Mental models are deeply ingrained assumptions. These are still substantial achievements – and when linked to his popularizing of the notion of the ‘learning organization’ – it is understandable why Peter Senge has been recognized as a key thinker. we can make some judgements about the possibilities of his theories and proposed practices. of focusing our energies. while not being to everyone’s taste. 10) 5) Systems thinking . though. We could say that while there are some issues and problems with his conceptualization. personal mastery and the development of more sophisticated mental models and the way he runs the notion of dialogue through these does have the potential of allowing workplaces to be more convivial and creative. The five disciplines represent approaches (theories and methods) for developing three core learning capabilities: fostering aspiration. and of seeing reality objectively. As we have seen there are very deep-seated reasons why this may have been the case. developing reflective conversation. of developing patience." (p. there is the questions of whether Senge’s vision of the learning organization and the disciplines it requires has contributed to more informed and committed action with regard to organizational life? Here we have little concrete evidence to go on. The drawing together of the elements via the Fifth Discipline of systemic thinking.

the biggest threats we face nowadays are rarely sudden events. and personal mastery to realize its potential.    2) "The enemy out there. Team learning develops the skills of groups of people to look for the larger picture beyond individual perspectives. team learning. This makes it hard to pinpoint the reason an enterprise is failing.. Instead. And personal mastery fosters the personal motivation to continually learn how our actions affect our world. 10) Dividing an elephant in half does not produce two small elephants..    5) The Parable of the Boiling frog 6) The Delusion of Learning from Experience 7) The Myth of the Management Team The 11 Laws of the Fifth Discipline            1) Today's problems come from yesterday's "solutions. 8) Small changes can produce big results. 6) Faster is slower. Cave men needed to react to events quickly for survival." People fail to recognize their purpose as a part of the enterprise. However. mental models. 7) Cause and effect are not closely related in time and space. the harder the system pushes back. 4) The easy way out usually leads back in. 9) You can have your cake and eat it too ---but not all at once. but slow.but the areas of highest leverage are often the least obvious. 5) The cure can be worse than the disease. they see themselves as an inconsequential part of a system over which they have little influence. leading them to limit themselves to the jobs they must perform at their own positions. with so many hidden 'loose screws' around. 11) There is no blame. such as environmental changes." 3) The Illusion of Taking Charge 4) The Fixation of Events The tendency to see things as results of short-term events undermines our ability to see things on a grander scale. . Mental models focus on the openness needed to unearth shortcomings in our present ways of seeing the world. Building shared vision fosters a commitment to the long term. 3) Behavior will grow better before it grows worse. gradual processes." The Learning Disabilities  1) "I am my position." 2) The harder you push."Systems thinking also needs the disciplines of building shared vision.

they will not all work the same way. In 1960 he was awarded a medal by the Japanese Emperor for his services to that country's industry. would he believed. Constantly strive to reduce variation.a set of techniques which allowed them to manufacture high-quality goods without expensive machinery. because there won't be any.in the length of parts supposed to be uniform. in prices. Deming returned to the US and spent some years in obscurity before the publication of his book "Out of the crisis" in 1982. there is no need to inspect manufactured items for defects. 7. if applied to US manufacturing industry. The 14 points seem at first sight to be a rag-bag of radical ideas. he reasoned. While he was there. he taught 'statistical process control' to Japanese engineers . which we have paraphrased here: 1. 4. it is credited with launching the movement."Institute leadership". in work practices ."Cease dependence on inspection". From this premise. The more variation . 5."Improve constantly and forever". 2."Move towards a single supplier for any one item. Although Deming does not use the term Total Quality Management in his book. in delivery times."Institute training on the job". Deming set out 14 points which. If variation is reduced. In this book. rather than merely expect the workforce to do so. and this will introduce variation. 3. Replace short-term reaction with long-term planning. If people are inadequately trained. and with the invention of Total Quality Management (TQM). he set out his 14 points for management. 6. Deming went to Japan just after the War to help set up a census of the Japanese population. but the key to understanding a number of them lies in Deming's thoughts about variation. The implication is that management should actually adopt his philosophy." Multiple suppliers mean variation between feedstocks.the more waste."Create constancy of purpose towards improvement"."Adopt the new philosophy".Deming's 14 points W Edwards Deming was an American statistician who was credited with the rise of Japan as a manufacturing nation. save the US from industrial doom at the hands of the Japanese. Variation was seen by Deming as the disease that threatened US manufacturing. Deming makes a distinction between leadership and mere . Most of the central ideas of TQM are contained in "Out of the crisis".

Ford engineers could not understand the customer preference for the model with Japanese transmission. Deming saw production targets as encouraging the delivery of poor-quality goods. and they were willing to wait for the Japanese model. The latter is quota."Eliminate slogans". testing and sales (the last through global markets)[1] through various methods.it's the process they are working within. 14. 12. from 1950 onward. Finally. Deming sees management by fear as counter. but the other departments that use its outputs. The American-made car . andconsultant. that each department serves not the management. As both transmissions were made to the same specifications."Eliminate management by objectives".and target-based. 13.supervision. He is perhaps best known for his work in Japan. author. product quality. Deming made a significant contribution to Japan's later reputation for innovative highquality products and its economic power."Remove barriers to pride of workmanship". he taught top management how to improve design (and thus service). Ford engineers decided to take apart the two different transmissions."The transformation is everyone's job". Despite being considered something of a hero in Japan. lecturer. Many of the other problems outlined reduce worker satisfaction. professor. at the time of his death. 1993) was an American statistician.productive in the long term. William Edwards Deming (October 14. he was only just beginning to win widespread recognition in the U."Drive out fear". including the application of statistical methods. 10. Harassing the workforce without improving the processes they use is counter-productive. 9.S. He is regarded as having had more impact upon Japanese manufacturing and business than any other individual not of Japanese heritage. 8. Deming's teachings and philosophy can be seen through the results they produced when they were adopted by Japanese industry. Soon after the car model was on the market."Break down barriers between departments". because it prevents workers from acting in the organisation's best interests. 1900 – December 20. There. as the following example shows: Ford Motor Company was simultaneously manufacturing a car model with transmissions made in Japan and the United States. Dr. Another idea central to TQM is the concept of the 'internal customer'. Ford customers were requesting the model with Japanese transmission over the USA-made transmission. 11."Institute education and self-improvement". Another central TQM idea is that it's not people who make most mistakes .

The 14 points apply anywhere. Edwards Deming Institute in Washington. an M. The 14 points are a basis for transformation of [American] industry. He later worked at the U. must learn their responsibilities. 2. from Yale University(1928). Adoption and action on the 14 points are a signal that management intend to stay in business and aim to protect investors and jobs.S. D.parts were all within specified tolerance levels. Edwards Deming Institute is to foster understanding of The Deming System of Profound Knowledge to advance commerce. This made the Japanese cars run more smoothly and customers experienced fewer problems. Deming was the author of Out of the Crisis (1982–1986) and The New Economics for Industry.e. Later. including sacred choral compositions and an arrangement of The Star Spangled Banner.S. Douglas MacArthur as a census consultant to the Japanese government. Such a system formed the basis for lessons for top management in Japan in 1950 and in subsequent years. Deming had an internship at Bell Telephone Laboratories while studying at Yale. Department of Agriculture and the Census Department. Deming played flute & drums and composed music throughout his life. to small organisations as well as to large ones.[3] Deming received a BSc in electrical engineering from the University of Wyoming at Laramie (1921). which includes his System of Profound Knowledge and the 14 Points for Management (described below). to the service industry as well as to manufacturing. Library of Congress includes an extensive audiotape and videotape archive.C. Engineers at Ford could not understand how this was done. he famously taught statistical process control methods to Japanese business leaders. On the other hand. with the aim to become competitive and to stay in business.. Create constancy of purpose toward improvement of product and service. 1. and a Ph. plus or minus 1/8 of an inch . Government.S. and to provide jobs. if a part were supposed to be one foot long. until they met Deming. and peace. We are in a new economic age. Adopt the new philosophy. where the Deming Collection at the U. Education (1993). and much closer to the nominal values for the parts . Deming founded the W. returning to Japan for many years to consult and to witness economic growth that he had predicted would come as a result of application of techniques learned from Walter Shewhart at Bell Laboratories. Both graduate degrees were in mathematics and physics. from the University of Colorado (1925).g. D. Western management must awaken to the challenge. he became a professor at New York University while engaged as an independent consultant in Washington.[4] In 1993..C.then the Japanese parts were within 1/16 of an inch. While working under Gen. prosperity. .D. and take on leadership for change. The aim of the W. the Japanese car parts were virtually identical to each other. They apply to a division within a company.

4. so that everyone may work effectively for the company. depend on meaningful measures of quality. as well as supervision of production workers. Move towards a single supplier for any one item. 12. abolishment of the annual or merit rating and management by objective. 14. 7. a. The responsibility of supervisors must be changed from sheer numbers to quality. 10. 9. 11. We no longer need live with commonly accepted levels of delay. 6. Instead. Break down barriers between departments. Eliminate management by objective. defective material and defective workmanship. Instead. Drive out fear. Substitute leadership. The transformation is everybody's job. Substitute leadership. minimise total cost. Eliminate slogans. Eliminate work standards (quotas) on the factory floor. . Cease dependence on inspection to achieve quality. along with price. and thus constantly decrease costs. 13. Remove barriers that rob people in management and engineering of their right to pride in workmanship. Point 3: Cease dependence on mass inspection. Eliminate the need for inspection on a mass basis by building quality into the product in the first place. exhortations. Such exhortations only create adversarial relationships. Eliminate management by numbers. instead. inter alia. Supervision of management is in need of an overhaul. Point 1: Create constancy of purpose toward improvement of the product and service so as to become competitive. a. End the practice of awarding business on the basis of a price alone. Improve constantly and forever the system of production and service. require. design. Point 2: Adopt the new philosophy. Institute leadership. mistake. End the practice of awarding business on the basis of price tag. 8.3. stay in business and provide jobs. We are in a new economic age. Institute a vigorous program of education and self-improvement. to foresee problems of production and in use that may be encountered with the product or service. and production must work as a team. Put everybody in the company to work to accomplish the transformation. Institute training on the job. b. People in research. The aim of supervision should be to help people and machines and gadgets to do a better job. on a long-term relationship of loyalty and trust. numerical goals. statistical evidence that quality is built in. Point 4: Improve the quality of incoming materials. to improve quality and productivity. 5. sales. Remove barriers that rob the hourly paid worker of his right to pride in workmanship. as the bulk of the causes of low quality and low productivity belong to the system and thus lie beyond the power of the work force. This means. b. and targets for the workforce asking for zero defects and new levels of productivity.

and people in management. What an organization needs is not just good people. Improvement of quality will automatically improve productivity. Modern methods of on-the-job training use control charts to determine whether a worker has been properly trained and is able to perform the job correctly. This implies. Fear can often be found at all levels in an organization: fear of change. demanding zero defects and new levels of productivity without providing methods. People in different areas such as research. sales. Point 14: Top management's permanent commitment to ever-improving quality and productivity must be clearly defined and a management structure created that will continuously take action to follow the preceding 13 points. Substitute aids and helpful leadership. Point 10: Eliminate the use of slogans. Statistical methods must be used to discover when training is complete. of their right to pride of workmanship. constantly improve the system of production and service. Such exhortations only create adversarial relationships. Point 13: Institute a vigorous program of education. poor tools or fuzzy operational definitions. and to belong to it. abolition of the annual merit rating (appraisal of performance) and of management by objectives. whilst on the shopfloor. lack of maintenance of machines. Point 12: Remove the barriers that rob hourly workers. The emphasis of production supervisors must be to help people to do a better job. it needs people that are improving with education. . There should be continual reduction of waste and continual improvement of quality in every activity so as to yield a continual rise in productivity and a decrease in costs. Point 7: Institute modern methods of supervision. Point 11: Eliminate work standards that prescribe numerical quotas for the workforce and numerical goals for people in management. Point 8: Fear is a barrier to improvement so drive out fear by encouraging effective twoway communication and other mechanisms that will enable everybody to be part of change.Point 5: Find the problems. Point 9: Break down barriers between departments and staff areas. and encourage self-improvement for everyone. design. workers can also fear the effects of change on their jobs. administration and production must work in teams to tackle problems that may be encountered with products or service. posters and exhortations for the workforce. Management must prepare to take immediate action on response from supervisors concerning problems such as inherited defects. Point 6: Institute modern methods of training and education for all. fear of the fact that it may be necessary to learn a better way of working and fear that their positions might be usurped frequently affect middle and higher management.

The primacy of the phenomenal: Recognizing and taking seriously the human world of experience as the only immediately given reality. and applications. to the United States . and centering of the given ('insight') in the direction of the desired solution. or were forced to flee. .Connections among psychological contents are more readily and more permanently created on the basis of substantive concrete relationships than by sheer repetition and reinforcement. but as a paradigm that is continuing to . Köhler and Lewin emigrated. The GTA views as its main task the provision of a scientific and organizational framework for the elaboration and further development of the perspective of Gestalt theory in research and practice. Methodologically. Crucial phenomena are examined without reduction of experimental precision.It is the interaction of the individual and the situation in the sense of a dynamic field which determines experience and behavior. behaviorism. or to the Gestalt principles of the organization of perception (as it is presented in many publications).Thinking and problem solving are characterized by appropriate substantive organization. the fruitfulness of which for psychology and psychotherapy has by no means been exhausted. Ernst Mach. processes. and particularly of Christian von Ehrenfels and the research work of Max Wertheimer.In memory. Wertheimer. . but must be understood as essentially far broader and more encompassing: . and Kurt Lewin. The coming to power of national socialism substantially interrupted the fruitful scientific development of Gestalt theory in the German-speaking world. Kurt Koffka.GESTALT THEORY Gestalt theory is a broadly interdisciplinary general theory which provides a framework for a wide variety of psychological phenomena. . Gestalt theory is to be understood not as a static scientific position. restructuring. and has its origins in some orientations of Johann Wolfgang von Goethe. It is especially suited for the understanding of order and structure in psychological events. . . is a fundamental assertion of Gestalt theory. Gestalt theory is not limited only to the concept of the Gestalt or the whole. who opposed the elementistic approach to psychological events. Koffka. there is a tendency toward specific relationships in the interaction of strengths and needs. the attempt is to achieve a meaningful integration of experimental and phenomenological procedures (the experimental-phenomenological method). . Wolfgang Köhler. associationism. and not only drives (psychoanalysis. In this sense. The epistemological orientation of Gestalt theory tends to be a kind of critical realism. Skinner) or static personality traits (classical personality theory). structures based on associative connections are elaborated and differentiated according to a tendency for optimal organization. Human beings are viewed as open systems in active interaction with their environment. and to psychoanalysis. ethology) or external stimuli (behaviorism. and not simply discussing it away.Cognitions which an individual cannot integrate lead to an experience of dissonance and to cognitive processes directed at reducing this dissonance.In a supra-individual whole such as a group.

The epistemological orientation of Gestalt theory tends to be a kind of critical realism.The primacy of the phenomenal: Recognizing and taking seriously the human world of experience as the only immediately given reality. Kurt Koffka. Wertheimer. The GTA views as its main task the provision of a scientific and organizational framework for the elaboration and further development of the perspective of Gestalt theory in research and practice. and Kurt Lewin.Connections among psychological contents are more readily and more permanently created on the basis of substantive concrete relationships than by sheer repetition and reinforcement. associationism. In this sense. and applications. Methodologically. Ernst Mach. the fruitfulness of which for psychology and psychotherapy has by no means been exhausted.In memory. Köhler and Lewin emigrated.In a supra-individual whole such as a group. or were forced to flee. The coming to power of national socialism substantially interrupted the fruitful scientific development of Gestalt theory in the German-speaking world. there is a tendency toward specific relationships in the interaction of strengths and needs. the attempt is to achieve a meaningful integration of experimental and phenomenological procedures (the experimental-phenomenological method). it attains major significance for many of the current concerns of psychology.It is the interaction of the individual and the situation in the sense of a dynamic field which determines experience and behavior. . and not simply discussing it away. or to the Gestalt principles of the organization of perception (as it is presented in many publications). restructuring. ethology) or external stimuli (behaviorism. and has its origins in some orientations of Johann Wolfgang von Goethe. structures based on associative connections are elaborated and differentiated according to a tendency for optimal organization.Cognitions which an individual cannot integrate lead to an experience of dissonance and to cognitive processes directed at reducing this dissonance.Thinking and problem solving are characterized by appropriate substantive organization. and to psychoanalysis. and not only drives (psychoanalysis. . Gestalt theory is not limited only to the concept of the Gestalt or the whole. . but must be understood as essentially far broader and more encompassing: . and particularly of Christian von Ehrenfels and the research work of Max Wertheimer. processes. to the United States. . Skinner) or static personality traits (classical personality theory). . Gestalt theory is a broadly interdisciplinary general theory which provides a framework for a wide variety of psychological phenomena.develop. and centering of the given ('insight') in the direction of the desired solution. Koffka. Wolfgang Köhler. It is especially suited for the understanding of order and structure in psychological events. Through developments such as the theory of the self-organization of systems. is a fundamental assertion of Gestalt theory. Crucial . who opposed the elementistic approach to psychological events. behaviorism. . Human beings are viewed as open systems in active interaction with their environment.

such as the grouping of similar.seemingly innate mental laws which determined the way in which objects were perceived.phenomena are examined without reduction of experimental precision. rather than being a secondary quality that emerges from those parts. problem solving and psychopathology. It should also be emphasized that Gestalt psychology is distinct from Gestalt psychotherapy. defining the parts of which it was composed. Max Wertheimer. divided the object of study into a set of elements that could be . It can be broken up into two: figure or ground. Gestalt psychology or gestaltism (German: Gestalt . and of research into behavior. but as a paradigm that is continuing to develop. Gestalt theory is to be understood not as a static scientific position. at first glance do you see the figure in front of you or the background? These laws took several forms. based on traditional scientific methodology."essence or shape of an entity's complete form") of the Berlin School is a theory of mind and brain positing that the operational principle of the brain is holistic. gestaltism is often opposed to structuralism and Wundt. 1886). such as Kurt Koffka. with self-organizing tendencies. objects together. Early 20th century theorists. The investigations developed at the beginning of the 20th century. Although Gestalt has been criticized for being merely descriptive. and Wolfgang Köhler (students of Carl Stumpf) saw objects as perceived within an environment according to all of their elements taken together as a global construct. in formulating their very similar concepts of Gestalt and Figural Moment. respectively. The phrase "The whole is greater than the sum of the parts" is often used when explaining Gestalt theory. The idea of Gestalt has its roots in theories by Johann Wolfgang von Goethe. as von Ehrenfels's earlier GestaltQualität had been. The Gestalt effect is the form-generating capability of our senses. within this global process. It is based on the here and now. 2000). Through developments such as the theory of the self-organization of systems. it has formed the basis of much further research into the perception of patterns and objects ( Carlson et al. Both von Ehrenfels and Edmund Husserl seem to have been inspired by Mach's work Beiträge zur Analyse der Empfindungen (Contributions to the Analysis of the Sensations. One has little to do with the other. This 'gestalt' or 'whole form' approach sought to define principles of perception -. particularly with respect to the visual recognition of figures and whole forms instead of just a collection of simple lines and curves. parallel. and in the way you view things. thinking. The concept of Gestalt was first introduced in contemporary philosophy and psychology by Christian von Ehrenfels (a member of the School of Brentano). Max Wertheimer's unique contribution was to insist that the "Gestalt" is perceptually primary. Immanuel Kant. and Ernst Mach. In psychology. and analog. it attains major significance for many of the current concerns of psychology. or proximate.

Gestalt psychology attempts to understand psychological phenomena by viewing them as organised and structured wholes rather than the sum of their constituent parts." Some of these laws. developed in real conditions. The theoretical principles are the following:   Principle of Totality . The investigations in this subject crystallised into "the gestalt laws of perceptual organization. are as follows. Thus.The School of Gestalt established a need to conduct real experiments which sharply contrasted with and opposed classic laboratory experiments.g. they tried to explain human perception of groups of objects and how we perceive parts of objects and form whole objects on the basis of these. Biotic Experiment . in which it would be possible to reproduce. which are often cited in the HCI or interaction design community. and context. More specifically. the school of Gestalt practiced a series of theoretical and methodological principles that attempted to redefine the approach to psychological research. and Kurt Koffka who founded the so-called gestalt approaches to form perception. why. with higher fidelity. most notably by Max Wertheimer. The concept was first studied by the .A correlation exists between conscious experience and cerebral activity. and at what rate new ideas and technology spread through cultures. In the 30s and 40s Gestalt psychology was applied to visual perception. This signified experimenting in natural situations. what would be habitual for a subject.analyzed separately with the objective of reducing the complexity of this object. Wolfgang Köhler. holism. Diffusion of innovations Diffusion of Innovations is a theory of how. Sternberg 1996).In relation to the Totality Principle any psychological research should take as a starting point phenomena and not be solely focused on sensory qualities. Their aim was to investigate the global and holistic processes involved in perceiving structure in the environment (e. Contrary to this methodology.The conscious experience must be considered globally (by taking into account all the physical and mental aspects of the individual simultaneously) because the nature of the mind demands that each component be considered as part of a system of dynamic relationships. Based on the principles above the following methodological principles are defined:   Phenomenon Experimental Analysis . Gestalt psychology dissociates itself from the more 'elementistic'/reductionistic/decompositional approaches to psychology like structuralism (with its tendency to analyse mental processes into elementary sensations) and it accentuates concepts like emergent properties. Principle of psychophysical isomorphism .

Authority InnovationDecision This decision is made for the entire social system by few individuals in positions of influence or power.[1] Its basic epidemiological or internal-influence form was formulated by H.French sociologist Gabriel Tarde (1890) and by German and Austrian anthropologists such as Friedrich Ratzel and Leo Frobenius. three types of innovation-decisions have been identified within diffusion of innovations. practice. The key elements in diffusion research are: Element Innovation Communication channels Time Definition Rogers defines an innovation as "an idea. or object that is perceived as new by an individual or other unit of adoption" [5]. "A social system is defined as a set of interrelated units that are engaged in joint problem solving to accomplish a common goal" [9]. "Rate of adoption is the relative speed with which an innovation is adopted by members of a social system" [8]. "The innovation-decision period is the length of time required to pass through the innovation-decision process" [7]. Who makes the decision? Based on these considerations. Collective InnovationDecision This decision is made collectively by all individuals of a social system. A communication channel is "the means by which messages get from one individual to another" [6]. Earl Pemberton[2]. . Type Definition Optional InnovationDecision This decision is made by an individual who is in some way distinguished from others in a social system. Social system Decisions Two factors determine what type a particular decision is :   Whether the decision is made freely and implemented voluntarily. who provided examples of institutional diffusion such as postage stamps and compulsory school laws.

In this stage the individual is interested in the innovation and actively seeks information/detail about the innovation. 83). This process is a type of decision-making. evaluation. 79). in this stage the . trial. In later editions of the Diffusion of Innovations Rogers changes the terminology of the five stages to: knowledge. persuasion. Due to the individualistic nature of this stage Rogers notes that it is the most difficult stage to acquire empirical evidence (Rogers 1964. Confirmation Although the name of this stage may be misleading. implementation. and adoption. Ryan and Gross first indicated the identification of adoption as a process in 1943 (Rogers 1962. During this stage of the process the individual has not been inspired to find more information about the innovation. interest. p. Five stages of the adoption process Stage Knowledge Definition In this stage the individual is first exposed to an innovation but lacks information about the innovation.Diffusion of an innovation occurs through a five–step process. Persuasion Decision In this stage the individual employs the innovation to a varying degree depending on the situation. In this stage the individual takes the concept of the innovation and weighs the advantages/disadvantages of using the innovation and decides whether to adopt or reject the innovation. However the descriptions of the categories have remained similar throughout the editions. During this stage the individual determines Implementation the usefulness of the innovation and may search for further information about it. decision. It occurs through a series of communication channels over a period of time among the members of a similar social system. and confirmation. An individual might reject an innovation at any time during or after the adoption process. Rogers categorizes the five stages (steps) as: awareness. p.

Inject an innovation into a group of individuals who would readily use an innovation. Compatibility is the second characteristic. creating an instinctive desire for a specific innovation. In describing how an innovation reaches critical mass. In the book Diffusion of Innovations. The complexity of an innovation is a significant factor in whether it is adopted by an individual. The adoption of an innovation follows an S curve when plotted over a length of time. This is a point in time within the adoption curve that enough individuals have adopted an innovation in order that the continued adoption of the innovation is self-sustaining. observability. trialability. The rate of adoption is defined as: the relative speed with which members of a social system adopt an innovation.[10] The categories of adopters are: innovators. early majority. Rogers outlines several strategies in order to help an innovation reach this stage. The relative advantage is how improved an innovation is over the previous generation. 134). These strategies are: have an innovation adopted by a highly respected individual within a social network. In general individuals who first adopt an innovation require a shorter adoption period (adoption process) than late adopters. An innovation that is more visible will drive communication among the individual’s peers and personal networks and will in turn create more positive or negative reactions. It is usually measured by the length of time required for a certain percentage of the members of a social system to adopt an innovation (Rogers 1962. The fourth characteristic. early adopters. p. and laggards (Rogers 1962. Within the rate of adoption there is a point at which an innovation reaches critical mass. 150) . p. Rogers suggests a total of five categories of adopters in order to standardize the usage of adopter categories in diffusion research. is the extent that an innovation is visible to others. late majority. Rogers defines an adopter category as a classification of individuals within a social system on the basis of innovativeness. Rogers defines several intrinsic characteristics of innovations that influence an individual’s decision to adopt or reject an innovation. If the innovation is too difficult to use an individual will not likely adopt it. and provide positive reactions and benefits for early adopters of an innovation. If a user has a hard time using and trying an innovation this individual will be less likely to adopt it. the level of compatibility that an innovation has to be assimilated into an individual’s life. determines how easily an innovation may be experimented with as it is being adopted. The rates of adoption for innovations are determined by an individual’s adopter category.individual finalizes their decision to continue using the innovation and may use the innovation to its fullest potential. The final characteristic.

and learning theory. 1987). economic. the way that education and training are conducted has changed very little during the past few decades. 1997). software. implementation. we will discuss a very important trend--the gradual shift in focus from thinking about adoption (the initial decision to use an innovation) to . 1996). A complex web of social. Technical superiority. and institutionalization of innovations is essential to the field of educational technology because the field has suffered from a lack of widespread acceptance of technology (Burkman. Following this we will discuss some examples of how adoption and diffusion theory has been incorporated into the field of educational technology. we will discuss the adoption. and institutionalization of educational technology. technical. is not the only factor that determines whether or not an innovation is widely adopted--it might not even be the most important factor (Pool. Understanding why people use educational technology and. In order to fully understand the field. Studying the adoption. design models. such as the common use of electronic mail or word processors in higher education (Green.Educational technology is a field of innovation and change. and institutionalization come in. and assess instruction and training. That’s where adoption. implementation. diffusion. practitioners have to understand more than just hardware. diffusion. while important. and individual factors interact to influence which technologies are adopted and to alter the effect of a technology after it has been adopted (Segal. deliver. Then. implementation. diffusion. perhaps more importantly. administer.1996) or the growing use of performance technology in industry (Desrosiers & Harmon. organizational. why they don’t is at the core of the process. Many of the most important products and practices developed by educational technologists require dramatic shifts in the way we think about. In this chapter. While it’s possible to point to some notable exceptions. We will begin by looking at some of the best known theories about adoption and diffusion. 1994). One major reason for this lack of utilization is that educational technologists have concentrated their efforts on developing instructionally sound and technically superior products while giving less consideration to other issues.

As shown in Figure 1. but a process that occurs over time.thinking about implementation and institutionalization. The first stage is “Knowledge” in which potential adopters find out about an innovation and gain a basic understanding of what it is and how it works. The Confirmation Stage might also describe the adoption of an innovation that was previously rejected. The most widely cited and most influential researcher in the area of adoption and diffusion is Everett Rogers. 1976). that the innovation is actually adopted or rejected. We will define implementation and institutionalization and discuss why this shift is happening. the adopter seeks information about the innovation and either continues or discontinues use of the innovation. Rogers’ Diffusion of Innovations is perhaps the single most important book related to this topic and provides a comprehensive overview of adoption and diffusion theory. It was first published in 1962 and now in its 4th edition (Rogers. occurs when the innovation is actually used. farm innovations in India (Sekon. The second stage is “Persuasion” in which potential adopters form a positive or negative impression of the innovation. 1995). 1999) and include a summary and conclusions. . We will also provide a list of conditions that contribute to implementation (Ely. The fourth stage. 1995). 1995). One of the most important theories discussed by Rogers is the InnovationDecision Process Model. 1968). Potential adopters go through five stages when interacting with an innovation. this model suggests that the adoption of an innovation is not a single act. It is only in the third stage. In the fifth stage. 1943) is considered to be the first major. and weather forecasting (Surry. “Confirmation”. 1998). In fact. 1993). Other researchers have investigated the diffusion of innovations in such diverse fields as solar power (Keeler. Overview of the Adoption and Diffusion Process There has been a long and impressive history of research related to the adoption and diffusion of innovations (Surry & Brennan. Many of the most important and earliest studies in this area were conducted by researchers working in the field of rural sociology (Rogers. a study that investigated the diffusion of hybrid-seed corn (Ryan & Gross. influential diffusion study of the modern era (Rogers. “Implementation”. “Decision”.

Most people will fall into either the Early Majority (34%) or the Late Majority (34%) categories. is not too complex. Educational . Complexity. Fliegel & Kivlin.g.5% of any population.5% of the population. Observability. “Innovators”. Perceived attributes refers to the opinions of potential adopters who base their feelings about of an innovation on how they perceive that innovation in regard to five key attributes: Relative Advantage. and sometimes lengthy process before becoming widely adopted within a population. Five stages of Rogers’ (1995) Innovation-Decision Process Model. beliefs and needs. comprise about 16% of the population. 1966. make up about 2. Another important and influential idea discussed by Rogers is the concept of adopter categories. can be tried out before adoption. The concept of perceived attributes (Rogers.. predictable. 1974). This concept states that.Figure 1. and. Trialability. and has observable benefits. Compatibility. Wyner. Figure 2. Hypothesized distribution of adopter categories within a typical population. “Early Adopters” make up approximatley 13. there is usually a normal distribution of the various adopter categories that forms the shape of a bell curve (see Figure 2). In short. those who readily adopt an innovation. while others will be less likely to adopt. those who will resist an innovation until the bitter end. for any given innovation. 1995) has served as the basis for a number of diffusion studies (e. a certain percentage of the population will readily adopt the innovation. this construct states that people are more likely to adopt an innovation if the innovation offers them a better way to do something. not just relative advantage. “Laggards”. Perceived attributes are important because they show that potential adopters base their opinions of an innovation on a variety of attributes. The concept of adopter categories is important because it shows that all innovations go through a natural. is compatible with their values. According to Rogers.

a period of rapid adoption. He used perceived attributes to develop a method for developing instructional products that would be more appealing to potential . Diffusion Theory Applied to Educational Technology The theories and concepts discussed by Rogers in Diffusion of Innovations are applicable to the study of innovations in almost any field. one can think of the many factors that combined to lead to the widespread acceptance of the World Wide Web between the years 1993 and 1995. When depicted on a graph . such as computers. and not focus exclusively on technical superiority. For example. such as innovative teaching techniques (Holloway. this slow growth. diffusion theory has most often been applied to the study of either artifacts. should try to think about how potential adopters will perceive their innovations in terms of all of the five attributes.technologists. Ernest Burkman (1987) is one of the authors who specifically links diffusion theory with educational technology. Burkman realized that educational technology had been suffering from little utilization and turned to diffusion theory for a possible solution. This curve shows that a successful innovation will go through a period of slow adoption before experiencing a sudden period of rapid adoption and then a gradual leveling off . Figure 3. or knowledge. 1996). In the field of educational technology. A number of researchers have used these theories and concepts to study the adoption and diffusion of educational technology innovations. and a gradual leveling off. The period of rapid expansion. rapid expansion and leveling off form an S-shaped curve (see Figure 3). occurs when social and technical factors combine to permit the innovation to experience dramatic growth. therefore. The S-shaped adoption curve is another important idea that Rogers (1995) has described. Example of an S-curve showing initial slow growth. for most successful innovations.

The five steps in Burkman’s UOID are: 1) Identify the potential adopter 2) Measure relevant potential adopter perceptions 3) Design and develop a user-friendly product 4) Inform the potential adopter (of the product's user-friendliness) 5) Provide Post Adoption Support In addition to Burkman. Fullan and Pomfret (p. prominent researcher in this area.adopters. implementation should be an integral part of a comprehensive and systematic change plan from the beginning. As the adoption and diffusion process moves along. and Black (1997) used diffusion concepts as the basis for an evaluation of a program intended to introduce teachers to the Internet. the actual use or implementation of an innovation in a specific setting becomes more and more important. That is. Sherry.the actual use of an innovation in practice.. other researchers have incorporated diffuison theory into educational technology applications. ". Farquhar and Surry (1994) used diffusion theory to identify and analyze factors that might impede or assist the adoption of instructional innovations within organizations. 360) introduced the concept of "mutual adaptation" whereby local conditions should be considered and modification of original materials and procedures should be altered accordingly. he calls the implementation perspective.. innovations that require replication for successful outcomes often follow an approach that is analogous to behavioral learning. defines implementation as ". procedure. It was felt that the local . Of course.both the content and process of dealing with ideas. programs. From Replication to Mutual Adaptation In the process of implementation.. each product. Stockdill and Morehouse (1992) used diffusion concepts in a checklist of factors to consider when attempting to increase the adoption of distance learning and other educational technologies. A growing amount of dissertation research is being conducted in the area of diffusion theory as it is related to educational technology. Lawyer-Brook. 1996).. From Diffusion and Adoption to Implementation There appears to be a growing trend in innovation research away from adoption and diffusion towards implementation and institutionalization. For example. and policies that are new to the people involved" (Fullan. activities. structures." Further. Michael Fullan. Burkman called his new approach “ user-oriented instructional development (UOID)”. and practice has to maintain a high fidelity to the original or else success cannot be guaranteed. Until Fullan and Pomfret (1977) spelled out the process and issues in their review of implementation research. not much was said about the steps after diffusion and adoption.

Purists. Where innovations have been adopted and implemented.professionals could make better assessments of the needs and potential reception of the innovation than the original developer or researcher. 1975). what are the conditions that appear to facilitate the process? Are there consistencies among the facilitating conditions from innovation to innovation and from place to place? This logic reverses a concern for resistance to a more positive one of facilitating factors thus providing an avenue for further exploration. "Why were . implementation might fail. it was a short step to an approach that was less “lock step” and more analogous to constructivism. Mechanical use." The basic argument has been that if we knew what types of resistance exist. based on measurement of classroom use of computers. perhaps we could design strategies to combat them. Looking for Facilitative Conditions A less common approach to understanding the process of implementation has been to tease out reasons for successful programs rather than to identify the barriers. products and practices. Levels of Technological Implementation (LoTi). Other Models One of the tools often used to guide implementation efforts in schools is Hall's Concerns Based Adoption Model (CBAM) (Hall & Hord. organizational and psychological. Awareness. the Levels of Use (LoU) scale is introduced (Hall & Loucks. 1987). has been proposed by Moersch (1995).. Prominent among those who have journeyed into this puzzling morass are Zaltman and Duncan (1977). This approach to implementation has been successful only when strategies for overcoming specific points of resistance have been developed. felt that if replication was not identical to the original specifications. Integration. Moersch modifies Hall's levels to provide guidance for determining the extent of implementation using seven levels: Nonuse.. and Renewal. These authors define resistance as ". They can be classified as cultural. Integration. Orientation (initial information). In the implementation phase of this model. The basic levels are: Nonuse. What About Resistance to Innovations? Over the years there have been studies and explorations of the resistance factors that thwart diffusion and implementation efforts. Refinement. however. Rather than to come up with ways to get around resistance. Once professional educators realized that they could modify programs. There are many different types of resistance. Infusion. Local participation in the modifications created a greater sense of ownership. Exploration. a series of studies looked at successful implementation of innovations and asked. Expansion. and Refinement. social. Routine. A modification of the LoU.any conduct that serves to maintain the status quo in the face of pressure to alter the status quo. The last four levels actually move into the area of institutionalization discussed later in this chapter. Preparation (to use).

Training is usually a vital part of most successful innovations. Knowledge and skills exist. Time is necessary to acquire and practice knowledge and skills.these innovations successful?" The findings of these studies uncovered eight conditions that contribute to implementation (Ely. communication among all parties involved in the process or their representatives. Dissatisfaction is based on an innate feeling or is induced by a "marketing. 4. "company" time. Things could be better. 5. This means good time. 6. This factor is seen most frequently in those who advocate the innovation and their supervisors. 1999). Others seem to be moving ahead while we are standing still. An incentive is something that serves as an expectation of a reward--a stimulus to act. Without them. 3. Availability of time. Without them. implementation is reduced. . audiovisual media and the like. Resources are the things that are required to make implementation work--the hardware. software. Dissatisfaction with the status quo. This is shared decision-making. 2. A reward is something given for meeting an acceptable standard of performance. Rewards and/or incentives exist. Knowledge and skills are those required by the ultimate user of the innovation. Participation." campaign. Availability of resources. not just personal time at home. Commitment. 7. This condition demonstrates firm and visible evidence that there is endorsement and continuing support for the innovation. people become frustrated and immobilized. 1.

Some of the most important variables regarding the innovation are the attributes of the innovation discussed earlier--its relative advantage (when compared with the current status).. 2.a process through which an organization assimilates an innovation into its structure" (Miles.. . compatibility with the values of the organization or institution. there are six commonly accepted indicators of institutionalization: 1.. Firm expectation that use of the practice and/or product will continue within the institution or organization. Widespread use of the innovation throughout the institution or organization. & Vandenburghe. 1990). Variables in the Setting and the Innovation Itself It is clear that the eight conditions are present in varying degrees whenever examples of successful implementation are studied. Some of the variables in the setting include organizational climate.. 4. The innovation is stable and reutilized.is implementation the final stage? Implementation should lead naturally into institutionalization. political complexity and certain demographic factors.8. It has become integral to the organization or the social system and is no longer considered to be an innovation. What is not so clear is the role of the setting in which the innovation is implemented. by a board and (2) leadership within the institution or project related to the day-to-day activities of the innovation being implemented. 3. Some writers call it "routinization" or "continuation. This factor includes (1) leadership of the executive officer of the organization and. But. 1987). its complexity (or simplicity).an assimilation of change elements into a structured organization modifying the organization in a stable manner. Eckholm.. trialability before wholesale adoption and observability by other professionals or the public... Acceptance by relevant participants--a perception that the innovation legitimately belongs. Leadership. sometimes. A classic work on the topic defines institutionalization as ". Indicators of Institutionalization According to the Regional Laboratory for Educational Improvement of the Northeast and Islands (Eiseman.” The ultimate criterion for a successful innovation is that it is routinely used in settings for which it was designed. The setting and the nature of the innovation are major factors influencing the degree to which each condition is present. Fleming & Roody.

one more decision must be made: "Is this innovation something we want to continue for the immediate future?" If it is. changes in governance. Awareness and experience with the change process is essential for a successful outcome. The technology adoption lifecycle is a sociological model developed by Joe M. new personnel classification. George M. Evaluation should be a constant partner during the process. Rogers at Iowa State University. simple transfer of these principles to specific environments would likely be futile. The change agent could be an internal person or an external specialist. One important conclusion is that there is no formula for this process. A strategy or plan for achieving the goals is the best way to proceed when considering the many variables that are likely to affect the outcomes. implementation and institutionalization have been conducted in many organizations and settings. Just as most instructional development requires a systemic approach so does the change process. internalization of training. [2][3][4] Their original purpose was to track the purchase patterns of hybrid seed corn by farmers. Several other indicators of routine use. describing how new ideas and technologies spread in different cultures. Gross and Bryce Ryan. Beal. Rogers and Bohlen together developed a technology diffusion model[5] and later Everett Rogers generalized the use of it in his widely acclaimed book. Continuation does not depend upon the actions of specific individuals but upon the organizational culture.5. . the above criteria could be used to assess the extent to which the innovation is institutionalized. Once implementation has been achieved.S. adoption. and turnover of key personnel. Bohlen. There is no substitute for a "front-end analysis" or needs assessment that yields the goals and objectives to be attained. Others have since used the model to describe how innovations spread between states in the U. There are many elements that should be considered in the process. Routine allocations of time and money. Summary and Conclusions Case studies of diffusion.[1] building on earlier research conducted there by Neal C. However. All of this activity should be coordinated by a change agent--a person who is sensitive to the variables that will impinge on the process. Beal and Everett M. Diffusion of Innovations[6](now in its fifth edition). called "passages and cycles" are listed by Yin and Quick (1978): support by local funds. most of them outlined in this chapter. structure or procedures. Communication among all participants throughout the process is essential. and 6.

and teacher. Subcommittee for the Study of the Diffusion of Farm Practices (as cited by Beal and Bohlen in their study above). less educated. The process of adoption over time is typically illustrated as a classical normal distribution or "bell curve. tended to be community leaders early majority .very conservative.younger. 2004) was a communication scholar." The model indicates that the first group of people to use a new product is called "innovators." followed by "early adopters. Rogers (March 6. The report summarized the categories as:      innovators . He is best known for originating the diffusion of innovations theory and for introducing the term early adopter. oldest and least educated Everett M." Next come the early and late majority.October 21.more conservative but open to new ideas. according to the demographic and psychological characteristics of defined adopter groups. were more educated. fairly conservative and less socially active laggards . more educated. 1931 . sociologist. and the last group to eventually adopt a product are called "laggards.had larger farms.older. ." The demographic and psychological (or "psychographic") profiles of each adoption group were originally specified by the North Central Rural Sociology Committee. active in community and influence to neighbour late majority . had small farms and capital.Rogers' bell curve The technology adoption lifecycle model describes the adoption or acceptance of a new product or innovation. more prosperous and more risk-oriented early adopters . writer.

an “s-shaped curve. early adopters(13. with Nancy Singer Olaguera) addresses the spread of the Internet. LEVERS OF CONTROL SIMONS . These categories. Rogers was an assistant professor of rural sociology at Ohio State University. then leveling off until only a small percentage of laggards have not adopted. Rogers had no plans to attend university until a school teacher drove him and some classmates to Ames to visit Iowa State University. early majority (34%). Rogers proposes that adopters of any new innovation or idea can be categorized as innovators (2. He returned to Iowa State University to earn a Ph. while the hybrid seed corn stood tall on the neighbor’s farm. the rate of adoption formed what came to typify the Diffusion of Innovations model. in 1931. He was only 30 years old but was becoming a world-renowned academic figure. and adoption.5%). Rogers’ father was finally convinced. based on standard deviations from the mean of the normal curve. but was highly resistant to biological–chemical innovations. Each adopter's willingness and ability to adopt an innovation depends on their awareness. (Arvind Singhal: Introducing Professor Everett M. When graphed.The Diffusion of Innovations became the second-most-cited book in the social sciences. interest. When the first edition (1962) of Diffusion of Innovations was published. (Rogers Diffusion Of Innovations 1983) His research and work became widely accepted in communications and technology adoption studies. based on the mathematically-based Bell curve. so he resisted adopting the new hybrid seed corn. and drunk driving.5%). His father loved electromechanical farm innovations. Geoffrey Moore's Crossing the Chasm drew from Rogers in explaining how and why technology companies succeed.Roger was born in Early liPinehurst Farm in Carroll. the crop on the Rogers’ farm wilted. In the mid2000s. Rogers was also able to relate his communications research to practical health problems. family planning. He then served in the Korean War for two years. late majority (34%) and laggards (16%). During the Iowa drought of 1936. more rapid as adoption increases. trial.” (S curve) The graph essentially shows a cumulative percentage of adopters over time – slow at the start. Rogers decided to pursue a degree in agriculture there.D. cancer prevention. including hygiene. Rogers. and how it has transformed the way human beings communicate and adopt new ideas. in sociology and statistics in 1957. The fifth edition (2003. however. People can fall into different categories for different innovations—a farmer might be an early adopter of mechanical innovations. and also found its way into a variety of other social science studies. evaluation. 47th Annual Research Lecturer. University of New Mexico)[1]. but a late majority adopter of biological innovations or VCRs. Iowa. provide a common language for innovation researchers. even though it yielded 25% more crop and was resistant to drought.

Internal control systems. successful balance scorecard adopters use . Examples in this category include mission statements and vision statements. According to Kaplan & Norton. Interactive systems. Boundary systems describeconstraints in terms of employee behavior. and 5. The confusion is related to how and where the balanced scorecard fits into the levers of control. 3. The purpose of an interactive system is to promote debate related to the assumptions underlying the organization's strategy and ultimately to promote learning and growth. forbidden actions. i. Belief systems.e. Interactive systems focus on communicating and implementing the organization's strategy. Belief systems relate to the fundamental values of the organization. Boundary systems. 4.The five control levers include: 1. 2. Internal control systems are related to protecting assets.. while diagnostic systems theoretically provide information indicating when a system is in control or out of control. Diagnostic systems.

an organization has to use it as a strategic system.the scorecard as an interactive system (p. 350)." "empowerment of employees. The message is. to obtain the potential benefits of the balanced scorecard. Simon's term "interactive system" seems to be essentially the same as Kaplan & Norton's term "strategic system". "Total quality.suggest that traditional controls may no longer be .all popular themes in today's organizations -." and "process reengineering" -. Some balanced scorecard implementations have failed because companies used the scorecard as only a diagnostic system.

it will be difficult to find value in the rest of Simons' ideas. Simons' premise is that a fundamental problem in creating organizational value is balancing unlimited opportunity with limited attention. Simons suggests that heavy reliance on staff groups such as internal auditors as the gatekeepers of diagnostic control systems yields a number of organizational benefits.core values. and critical performance variables -. . the fourth lever of control.then each construct can be controlled with one of four different levers. consists of the formal information systems that managers use to involve themselves regularly and personally in the decision-making activities of subordinates. In his analysis. If the reader disagrees with any of these premises. they desire to achieve and contribute. It is in discussion of this fourth lever that Simons integrates other management theories most heavily. and individuals possess creative potential. According to Simons. Finally. which basically form the organization's own "Ten Commandments" and are used to define acceptable risks and standards of business conduct. In Levers of Control. interactive control systems. Simons makes several significant assumptions about human behavior: individuals in organizations are ethical. Harvard Business School professor and author Robert Simons takes a shot at questions about how today's control systems look and how management can implement and utilize them effectively. The first lever consists of an organization's beliefs systems. He also looks at the auditor's role in recommending and evaluating control systems. if four constructs are understood and analyzed -. Simons' familiarity with strategic management theory is evident and integrates well with the discussions of the levers of control. the levers managers use to process and transmit information. The focus of diagnostic systems is on outcomes.appropriate. Simons recognizes that there are inherent tensions between what individuals want to do and actually will do. how they interrelate. Traditional management controls such as diagnostic control systems are given a bad rap by Simons. Much of Simons' narrative is devoted to explaining what the new "levers of control" are. and he argues that managers either pay too little or too much attention to them. However. Simons focuses primarily on the informational aspects of management control systems. Lever two is made up of boundary systems. Simons maintains. and how these constructs support or contradict other management theories. which are often embodied in the mission statement and are used to communicate core values. Diagnostic control systems. make up lever three. the focus is on process. which include the traditional methods used to measure critical performance variables and interactive control systems. strategic uncertainties. risks to be avoided.

There are four control levers or “systems” that can aid managers in achieving the balance between employee empowerment and effective control: 1. When these deviant behaviors finally came to light. Depending upon the reader's experience.or less -. They must find ways to encourage employees to think for themselves. while still retaining enough control to ensure that employee creativity will ultimately benefit and improve the company. And. He presents results from his ten-year examination of control in several companies from ten different industries. Giving employees too much autonomy has led to disaster for many companies.g. including such well-known names as Sears and Standard Chartered Bank. and productivity while still giving employees the freedom to be creative. innovative and flexible. activities.effectively depending upon the current phase of the firm's life cycle. the companies incurred substantial losses not only financially. . In the modern corporate world. efficiency. In these companies and many others. employees had enough independence that they were able to engage in and mask underhanded. managers simply do not have time to watch everyone all the time. and health aids. food. and sometimes illegal..Simons proposes that the levers of control work more -. this method of managing employees has all but been abandoned except in those industries that lend themselves to standardization and repetition of work activities (e. Simons provides an excellent narrative on balancing empowerment and control and provides a handy summary of what managers and staff groups must do to effectively implement the four control systems. although well articulated. computer. to create new processes and methods. Simons' examination certainly does not oversimplify the challenges experienced by all members of an organization as they collaborate to achieve the enterprise's worthwhile goals. including banking. the field study may enhance understanding of the control lever and life cycle interrelationships. In these work environments. but also in internal company morale and external public relations. in casinos and on assembly lines). diagnostic control systems. and machinery manufacturing. In most industries. His evidence shows how the ten managers and their organizations utilized the control levers to drive changes during the first 18 months of the managers' tenures. Introduction One of the most difficult problems managers face today is maintaining control. employees were given very specific instructions on how to do their jobs and then were watched constantly by superiors to ensure the instructions were carried out properly. One method of preventing these kinds of incidents is for companies to revert to the “machinelike bureaucracies” of the 1950s and 60s.

. 3. interactive control systems. empowered employees may sometimes use their capacity for creativity to manipulate the factors under their control in order not to fall short of their manager’s expectations. measured in quantitative terms. Beliefs systems are generally broad and designed to appeal to many different types of people working in many different departments. itself) are often based on how well performance goals have been met or exceeded.) to periodically scan for anything unusual that might indicate a potential problem. employees must be able to see key values and ethics being upheld by those in supervisory and other top executive positions. as did many companies in the past. and to do it in a way that may be new or innovative. Such manipulations can only have very shortterm positive effects and can very possibly. Diagnostic Control Systems boundary beliefs systems. or other goal. If the goals are reasonable and attainable. but because it reflects the true nature and value system of the company as a whole. It is easier for employees to understand on an informal. etc. systems. In order for beliefs systems to be an effective lever of control. Employee bonuses (and sometimes even employment.2. statistical analyses and variance analyses. no matter how it’s done. depending on their magnitude. releasing them from the leash of perpetual surveillance. However. it is becoming more and more necessary to . ensures the numbers won’t fluctuate in a manner that would draw negative attention to a particular department or person. and This control lever relies on quantitative data. Empowered employees are free to complete their work. Meeting the goal.g. increases/decreases in overhead from month to month. 4. under some but not undue pressure to meet a deadline. when goals become unrealistic. but they can also induce employees and even managers to behave unethically in order to meet some kind of preset goal. Diagnostic systems can be very useful for detecting some kinds of problems. Senior management must be careful not to adopt a particular belief or mission simply because it is in vogue to do so at the time. As companies grow more complex. the diagnostic system works quite well. It enables managers to assign tasks and go on to other things. productivity level. lead to longrun disaster for the company. Beliefs Systems This control lever is used to communicate the tenets of corporate culture to every employee of the company. Managers use these and other numerical comparisons (e. however. innate level the mission and credo of a company that operates in only one industry. actual to budget.

it has become easier and more effective to set the rules regarding what is inappropriate rather than what is appropriate. positive. They are the “dark. cold constraints” to the “warm. Interactive Control Systems The key to this control lever is the word “interactive.establish formal. inspirational” tenets of belief systems. written mission statements and codes of ethics so that there can be no mistaking where the company is going and how it is going to get there. Boundary Systems This control lever is based on the idea that in an age of empowered employees. Companies use many different tools to accomplish this kind of regular communication. types of clients. etc. internally generated productions reports. The constraints are set by top management and are meant to steer employees clear of certain industries. face-toface contact. efficiency. in terms of profitability. there are four important characteristics which set the interactive control system apart: 1) the interactive system focuses on constantly changing data of an overall strategic nature.” Many times a company will implement a boundary system only after it has suffered a major crisis due to the lack of one. etc. One popular method of doing this is to analyze data from reports that are frequently released (for example. the Nielsen ratings). Management must be able to glean what is most critical from all aspects of an organization’s operations so that they can establish and maintain on a daily basis their overall strategic plan for the company. 3) the data is best analyzed in a face-to-face setting in . Though this may seem somewhat like the diagnostic control system discussed earlier. They are also intended to focus employee efforts on areas that have been determined to be best for the company. it is critical that subordinates and supervisors maintain regular. Examples of these kinds of standards include forbidding employees to discuss client matters outside the office or with anyone not employed by the company (sometimes including even spouses) and refusing to work on projects or with clients deemed to be “undesirable. productivity. 2) the strategic nature of the data warrants attention from all levels of management on a regular basis.” and can help to guard the good name of a company. It is important that companies begin to be proactive in establishing boundaries before they are needed.” In order for this kind of control system to work. and professional journals. an asset that can be very difficult to rebuild once damaged. Boundary systems are the flipside of belief systems. Boundary systems can be thought of in terms of “minimum standards. The effect of this kind of thinking is to allow employees to create and define new solutions and methods within defined constraints.

systems. An organic organization is a fluid and flexible network of multi-talented individuals who perform a variety of tasks. as per the definition of D. Harness Employees’ Creativity with the Four Levers of Control Potential To achieve To contribute To do right To create Organizational Managerial Control Blocks Solution Lever Lack of focus or of Build and support Diagnostic control resources. managers can unleash the creative potential of their subordinates without losing overall control of their team and its objectives. but never proved to really exist since it. . ORGANIC ORGANIZATION A term created by Tom Burns and G. It thrives on the power of personalities. rules of the game. A.groups that include all levels of employees. organic organizations. values and mission. and 4) the system itself stimulates these regular discussions. purpose. dialogue to encourage systems. this form of organizational structure was widely sought and proposed. Uncertainty about Communicate core Beliefs systems. temptation. Morand. Using the four levers of control discussed above in conjunction with one another. For an organization to be organic. clear targets. Conclusion Empowering employees is necessary for the continuing health and improvement of most companies. has the least hierarchy and specialization of functions. with no job descriptions or classifications. are flexible and value external knowledge. and communication to have a hub-network-like form. people in it should be equally leveled.M. Also called organismic organization. Stalker in the late 1950s. lack of rigid procedures and communication and can react quickly and easily to changes in the environment thus it is said to be the most adaptive form of organization. Lack of opportunity Open organizational Interactive control or fear of risk. adversely to the mechanistic organization. unlike mechanistic organizations (also coined by Burns and Stalker). learning. Pressure or Specify and enforce Boundary systems.

Stalker in the late 1950s. The use of Organic Organizations is good because in some way it becomes an incentive to employees to perform to the best of their ability. with no job descriptions or classifications. to look at the impact of technical innovation on organisations in the 1960s. a psychologist. are flexible and value outside knowledge. is better than individual leadership because there are several people controlling the environment. Gone are the formal roles and specialisms based on assigned. these establish sections compete for control over the added functions and resources. inefficient. For an organization to be organic. The question was how a traditional firm in Scotland. M. It thrives on the power of personalities. organic organizations. lack of rigid procedures and communication and can react quickly and easily to changes in the environment thus it is said to be the most adaptive form of organization. it has the least hierarchy and specialisation of functions. Gone is the idea that overall knowledge and coordination is found only at the top of the hierarchy. If something new comes into the firm. precisely defined. An organic organization is a fluid and flexible network of multi-talented individuals who perform a variety of tasks. There is the group or department with a stable career structure. Its sectional interests can be in conflict with other groups' interests. The findings were pessimistic in that they doubted whether traditional structures could incorporate fast moving change. moved into electronics in order to have a future and was therefore moving from a position of (diminishing) stability to one of fast moving change. . this leads to group leadership and teamwork. people in it should be equally levelled. There are three typical pathological system responses: Burns and Stalker have an alternative and this is the organismic or Organic form of management (and called Systemic). meaning that the organization takes into consideration the needs of their employees. This is because the individual in a traditional pyramidal organisation is not simply committed to the company.Organic Organizations Leads to Teamwork An organic organization is when the organization exist dependently. Stalker. but never proved to really exist since it is. Since organic organizations takes into consideration the ideas of the employees this opens the doors to create teamwork among employees. as per the definition of D. and adaptations which do take place accentuate the problem. Since in an organic organization the ideas and opinions of the employees are taken into consideration. a sociologist. A term created by Tom Burns and G. Group leadership. this form of organizational structure was widely sought and proposed. They could not attract electronics research and development engineers into their organisations. adversely to the mechanistic organization. Also called organismic organization. Morand. tasks. unlikemechanistic organizations (also coined by Burns and Stalker). This is against the company as a whole. These are pathological systems. and communication to have a hub-network-like form. A. om Burns. teamed up with G. instead of one person telling everyone what is expected.M.

528). It takes a huge change to become organismic if it can be done. Communication is horizontal. they have shown it needs stability. However. There is also history. PATH-GOAL THEORY . Heterodox liberal Christians inside these organisations were organismic (or systemic) in authority. with manifest and latent functions . unable to hold together a Church that is spiralling away into its new denominational constituents. the mechanistic and the organismic can be applied elsewhere. motivations . because they took it upon themselves to be the experts and specialists of theology in their very diverse writings. 1995. Experts may know more than many managers. One is the Weberian ideal types of mechanistic and organismic organisations. I applied it to historical and broad Christian Churches. So they are not actual expected organisations but tendencies for analysis. integration and pattern maintenance (Haralambos. The power system leaks out at many levels. Orthodox liberal Christians are bureaucrats and compromisers.actually. goal attainment. traditional and systemic. Rosenberg. One organisation then adapts successfully to a stable system. A firm has to know its past and reveal to itself the three systems of motivation. 1949. Without any reference to human fulfilment. 873). An organisational chart would depend on which job is being done and what process it involves. each with their own types of authority. So there is more than a hint of the Parsonian sociology of functional systems with adaptation.in terms of people using the manifest language of the overt system of formal control while operating latently with other motivations (Merton. Everyone should consult and consider the overall aims of the company as the situation keeps changing. career climbing and purposive decision taking. and one to a changing system. vertical and diagonal as required by the types of work involved. Because of the use of sociological categories. Knowledge is collaborative rather than restricted into specialisms. namely the charismatic. The politicking then is more diffuse. Expert career structures go beyond the organisation (just as do top executives) and may be based on individual reputations. and it may not last long. Those heterodox who left to join specialist liberal denominations pursued instead human relations authority. The mechanistic organisation defends itself through its people in positions of power. Holborn. This seemed to be the depressing summit of capitalist organisation. There are a number of sociological analyses here. in Coser.In organismic management a continual adjustment and flexibility in individual tasks is emphasised. they have argued for a need for a more human and responsive type of institution. because they were essentially re-creators of open gatherings that discussed truth. Technical additions and fast change means that experts are needed. The mechanistic relates to Weber also on bureaucracy and its rational-legal authority. 1976.

an Ohio State University graduate. [5] Occupations in which the achievement motive were most predominant were technical jobs. The theory states that a leader's behavior is contingent to the satisfaction.[5] The achievement-oriented leader behavior refers to situations where the leader sets challenging goals for followers. The path-goal model can be classified both as a contingency or as a transactional leadership theory. According to the original theory. motivation and performance of his subordinates. The theory was inspired by the work of Martin G. and supportive leader behaviors:  The directive path-goal clarifying leader behavior refers to situations where the leader lets followers know what is expected of them and tells them how to perform their tasks.The path-goal theory. in 1971 and revised in 1996. It is the leader’s job to assist followers in attaining goals and to provide the direction and support needed to ensure that their goals are compatible with the organization’s goals.[2] The supportive leader behavior is directed towards the satisfaction of subordinates needs and preferences.[1] in which the leadership behaviors and the follower perceptions of the degree to which following a particular behavior (path) will lead to a particular outcome (goal). This behavior is predominant when subordinates are highly personally involved in their work. The theory argues that this behavior has the most positive effect when the subordinates' role and task demands are ambiguous and intrinsically satisfying. and shows confidence in their ability to meet this expectation. sales persons. scientists. coaches.[2] The path-goal theory was also influenced by the expectancy theory of motivation developed by Victor Vroom in 1964.[2] The participative leader behavior involves leaders consulting with followers and asking for their suggestions before making a decision. and motivational when need satisfaction is contingent on performance. the manager’s job is viewed as guiding workers to choose the best paths to reach their goals. and the leader facilitates. The theory argues that leaders will have to engage in different types of leadership behavior depending on the nature and the demands of a particular situation. and entrepreneurs. The leader shows concern for the followers’    . and rewards effective performance. also known as the path-goal theory of leader effectiveness or the path-goal model. is a leadership theory in the field of organizational studies developed by Robert House. as well as the organizational goals. participative.[4] A leader’s behavior is acceptable to subordinates when viewed as a source of satisfaction. Evans (1970). The original path-goal theory identifies achievement-oriented. directive. engineers. expects them to perform at their highest level. The revised version also argues that the leader engages in behaviors that complement subordinate's abilities and compensate for deficiencies.

psychological well being. Environmental factors determine the type of leader behavior required if the follower outcomes are to be maximized. as situations require. . Effective leaders clarify the path to help their followers achieve goals and make the journey easier by reducing roadblocks and pitfalls. Environment is outside the control of the follower-task structure.[5] This behavior is especially needed in situations in which tasks or relationships are psychologically or physically distressing. authority system. Follower characteristics are the locus of control.[2] Path-goal theory assumes that leaders are flexible and that they can change their style. that moderate the leader behavior-outcome relationship. In contrast to the Fiedler contingency model. the path-goal model states that the four leadership styles are fluid. and work group. Research demonstrates that employee performance and satisfaction are positively influenced when the leader compensates for the shortcomings in either the employee or the work setting. The theory proposes two contingency variables. such as environment and follower characteristics. Personal characteristics of subordinates determine how the environment and leader are interpreted. and that leaders can adopt any of the four depending on what the situation demands. and perceived ability. experience.

Rewards may also be increased as needed and role ambiguity decreased (by telling them what they should be doing). Participative leadership Consulting with followers and taking their ideas into account when making decisions and taking particular actions.The Path-Goal Theory of Leadership was developed to describe the way that leaders encourage and support their followers in achieving the goals they have been set by making the path that they should take clear and easy. Achievement-oriented leadership . including the follower's capability and motivation. This includes giving them schedules of specific work to be done at specific times. In removing roadblocks. This approach is best when the work is stressful. This increases the follower's sense of security and control and hence is appropriate to the situation. This includes increasing the follower's self-esteem and making the job more interesting. leaders: • • • Clarify the path so subordinates know which way to go. Directive leadership Telling followers what needs to be done and giving appropriate guidance along the way. Increasing the rewards along the route. Leaders can take a strong or limited approach in these. as well as the difficulty of the job and other contextual factors. they may be directive or give vague hints. House and Mitchell (1974) describe four styles of leadership: Supportive leadership Considering the needs of the follower. boring or hazardous. In clarifying the path. This may be used when the task is unstructured and complex and the follower is inexperienced. showing concern for their welfare and creating a friendly working environment. they may scour the path or help the follower move the bigger blocks. Remove roadblocks that are stopping them going there. In increasing rewards. In particular. This variation in approach will depend on the situation. they may give occasional encouragement or pave the way with gold. This approach is best when the followers are expert and their advice is both needed and they expect to be able to give it.

specifying or assigning certain work tasks to be followed. Achievement-oriented leadership: Challenging goals are set and high performance is encouraged while confidence is shown in the groups' ability. High standards are demonstrated and expected. Participative leadership: Decision making is based on consultation with the group and information is shared with the group. For example.Setting challenging goals. both in work and in self-improvement (and often together). . • • • • Directive leadership: Specific advice is given to the group and ground rules and structure are established. This approach is best when the task is complex. clarifying expectations. The leader shows faith in the capabilities of the follower to succeed. Supportive leadership: Good relations are promoted with the group and sensitivity to subordinates' needs is shown.

[1] RACI is an acronym derived from the four key responsibilities most typically used: Responsible. Accountable (also Approver or final Approving authority) The one ultimately accountable for the correct and thorough completion of the deliverable or task. also known as RACI matrix or Linear Responsibility Chart (LRC). And Informed. i. Consulted. Accountable. Role Distinction There is a distinction between a role and individually identified people: a role is a descriptor of an associated set of tasks. There is typically one role with a participation type of Responsible.Responsibility assignment matrix A Responsibility Assignment Matrix (RAM). which can impede the value of this technique in clarifying the participation of each role on each task. Outside of this exception.e. and with whom there is two-way communication. Consulted Those whose opinions are sought. In other words. at most. It is especially useful in clarifying roles and responsibilities in cross-functional/departmental projects and processes. There must be only one Accountable specified for each task or deliverable. often only on completion of the task or deliverable. and the one to whom Responsible is accountable. and with whom there is just one-way communication. this generally implies that participation has not yet been fully resolved. Very often the role that is Accountable for a task or deliverable may also be Responsible for completing it (indicated on the matrix by the task or deliverable having a role Accountable for it. Where more than one participation type is shown. just one of the participation types. although others can be delegated to assist in the work required (see also RASCI below for separately identifying those who participate in a supporting role). an Accountablemust sign off (Approve) on work that Responsible provides. describes the participation by various roles in completing tasks or deliverables for a project or business process. may be performed by many people. Responsible Those who do the work to achieve the task. Informed Those who are kept up-to-date on progress. it is generally recommended that each role in the project or process for each task receive. and one . it is implied). but no role Responsible for its completion.

. and a person who is able to perform the role of project manager may also be able to perform the role of business analyst and tester.person can perform many roles.as illustrated in the image of an example responsibility assignment (or RACI) matrix.g. and a horizontal axis (top row) of roles (e.g. For example. . from an organizational chart) .g... The matrix is typically created with a vertical axis (left-hand column) of tasks (e. although traditionally each project only has one project manager at any one time. from a product breakdown structure PBS). an organisation may have 10 people who can perform the role of project manager. from a work breakdown structure WBS) or deliverables (e.

e. working with others)  Habit 4: Think Win-Win Synopsis: Genuinely striving for mutually beneficial solutions or agreements in your relationships. which creates an atmosphere of caring. self mastery)  Habit 1: Be Proactive Synopsis: Take initiative in life by realizing your decisions (and how they align with life's principles) are the primary determining factor for effectiveness in your life.  Habit 5: Seek First to Understand. first published in 1989. which was marked by the release of a 15th anniversary edition in 2004. propel you towards goals. is a self-help book written by Stephen R.The Seven Habits of Highly Effective People The Seven Habits of Highly Effective People. Covey presents an approach to being effective in attaining goals by aligning oneself to what he calls "true north" principles of a character ethic that he presents as universal and timeless. The Next Three are to do with Interdependence (i. which compels them to reciprocate the listening. and enrich the roles and relationships elaborated in Habit 2. then to be understood Synopsis: Using empathetic listening to be genuinely influenced by a person. take an open mind to being influenced by you. Evaluating if your efforts exemplify your desired character values.e. It has sold over 15 million copies in 38 languages since first publication. prioritizing.  Habit 3: Put First Things First Synopsis: Planning. and executing your week's tasks based on importance rather than urgency. Valuing and respecting people by understanding a "win" for all is ultimately a better long-term resolution than if only one person in the situation had gotten his way. which are represented by the following imperatives: The First Three Habits surround moving from dependence to independence (i. respect. Envision the ideal characteristics for each of your various roles and relationships in life. and positive problem solving. . Taking responsibility for your choices and the subsequent consequences that follow.  Habit 2: Begin with the End in Mind Synopsis: Self-discover and clarify your deeply important character values and life goals. Each chapter is dedicated to one of the habits. Covey.

one is always attempting to integrate and master the principles outlined in The 7 Habits at progressively higher levels at each iteration. change. According to Covey. purposeful and good life. and modeling inspirational and supportive leadership The Last habit relates to self-rejuvenation. a concept in which a person believes there are enough resources and success to share with others. along with meaningful and consistent progress. and power. commit. and health to create a sustainable long-term effective lifestyle. and 3). not considering the possibility of all parties winning (in some way or another) in a given situation. which is founded on the idea that. recognition and responsibility. whose book The Seven Habits Of Highly Effective People. The idea of renewal by education will propel one along the path of personal freedom. so as to achieve goals no one person could have done alone. that means you lose. Through our conscience.e. became a blueprint for personal development when it was published in 1990. Dr Stephen Covey's inspirational book .  Habit 7: Sharpen the Saw Synopsis: The balancing and renewal of your resources. security. Habit 6: Synergize Synopsis: Combining the strengths of people through positive teamwork. How to yield the most prolific performance out of a group of people through encouraging meaningful contribution. one must be increasingly educating the conscience in order to grow and develop on the upward spiral. and leads to the sharing of profits. wisdom. the spiral will result in growth. 2. It is commonly contrasted with the scarcity mindset (i. Don't let the challenge daunt you: The 'Seven Habits' are a remarkable set of inspirational and aspirational standards for anyone who seeks to live a full. if someone else wins or is successful in a situation. Individuals with an abundance mentality are able to celebrate the success of others rather than be threatened by it.The abundance mentality is believed to arrive from having a high self worth and security (see Habits 1. destructive and unnecessary competition). as the business . In essence. Subsequent development on any habit will render a different experience and you will learn the principles with a deeper understanding. The Upward Spiral model consists of three parts: learn. and constant improvement. Organizations may also apply an abundance mentality while doing business.7 Habits Of Highly Effective People® Dr Stephen Covey is a hugely influential management guru. Covey explains the "Upward Spiral" model in the sharpening the saw section. energy. do. and are applicable today more than ever. Covey coined the term abundance mentality or abundance mindset. A number of books appearing in business press since then have discussed the idea. The Seven Habits are said by some to be easy to understand but not as easy to apply.

necessary because achievements are largely dependent on co-operative efforts with others.world becomes more attuned to humanist concepts.Franklin Covey which has a global reach. (See the section on time management. habit 3 is the second or physical creation. and that success follows a co-operative approach more naturally than the confrontation of win-or-lose. Covey says that habit 2 is the first or mental creation. Stephen Covey's Seven Habits of Highly Effective People® Habit 1 . has also built a huge training and consultancy products and services business . speaker. This is about organizing and implementing activities in line with the aims established in habit 2. Covey helps to explain this in his simple analogy 'diagnose before you prescribe'. academic and humanist. This is Covey's habit of communication.) Habit 4 . By developing the habit of concentrating on relevant activities you will build a platform to avoid distractions and become more productive and successful. towards what you consider your aims.begin with the end in mind® Covey calls this the habit of personal leadership . and has at one time or another consulted with and provided training services to most of the world's leading corporations. rather than have it control you.leading oneself that is. conditions and circumstances Habit 2 . and the Johari Window. Habit 5 . Covey's values are full of integrity and humanity.think win-win® Covey calls this the habit of interpersonal leadership. Simple and effective. choice. (See the associated sections on Empathy. as is so often the case.seek first to understand and then to be understood® One of the great maxims of the modern age. He says that win-win is based on the assumption that there is plenty for everyone. and contrast strongly with the process-based ideologies that characterised management thinking in earlier times. and it's extremely powerful.be proactive® This is the ability to control one's environment. and the power to decide response to stimulus. Stephen Covey. Transactional Analysis. as well as being a renowned writer.) . Habit 3 .put first things first® Covey calls this the habit of personal management. Self determination. and essential for developing and maintaining positive relationships in all aspects of life.

you re in for an awakening. and it necessarily surrounds all the other habits. another distinct aspect of fulfilment through helping others. physical and the social/emotional. Covey released The Leader In Me—How Schools and Parents Around the World Are Inspiring Greatness. and The Seven Habits of Highly Effective Families. Stephen Covey's Seven Habits are a simple set of rules for life . or listen to the full audio series if you can get hold of it. Time will tell whether the 8th Habit achieves recognition and reputation close to Covey's classic original 7 Habits work. Huntsman School of Business at Utah State University. In his more recent book 'The 8th Habit'. As a newly minted CEO. Utah) is the author of the best-selling book. enabling and encouraging them to happen and grow. In 2008. and thoroughly uplifting. The 8th Habit book also focuses on leadership. 1932 in Salt Lake City. one may think to finally have the power to set strategy. Stephen R. and full access to the finer points of your business. Covey (born October 24. For many people.inter-related and synergistic.sharpen the saw® This is the habit of self renewal.Habit 6 . Read the book. Principle-Centered Leadership. Covey released The 8th Habit. and also with the later life-stages in Erikson's Psychosocial Life-Stage Theory. Stephen Covey introduced (logically) an the eighth habit. says Covey. which aligns helpfully with Maslow's notions of 'Self-Actualization' and 'Transcendence' in the Hierarchy of Needs model. literally changes their lives. comprehensive.synergize® Covey says this is the habit of creative co-operation . or listening to him speak. The Seven Surprises for New CEOs The Seven Surprises for New CEOs were described first in the HBR of October 2004 in an article by Michael Porter. The Seven Habits of Highly Effective People.the principle that the whole is greater than the sum of its parts. This 7 Habits summary is just a brief overview . Habit 7 . the authority to make things happen. Covey interprets the self into four parts: the spiritual. In 2004.the full work is fascinating. reading Covey's work. One Child at a Time. which implicitly lays down the challenge to see the good and potential in the other person's contribution. But if one expects the job to be as simple as that. Other books he has written include First Things First. Jay Lorsch and Nitin Nohria on CEO leadership. This is powerful stuff indeed and highly recommended. mental. which deals with personal fulfilment and helping others to achieve fulfilment too. He is currently a professor at the Jon M. Even though you bear . and yet each one powerful and worthy of adopting and following in its own right. which all need feeding and developing.

as a new CEO you must learn to manage organizational context rather than focus on daily operations. you're in for an awakening.fully prepares a person to be the chief executive. you may think you finally have the power to set strategy.” Professor Porter will return to South Africa on July 3 for a full-day event organised by Global Leaders. Even though you bear full responsibility for your company's wellbeing. even though others might treat you as omnipotent. • Giving orders is very costly. you must recognise that your position does not confer the right to lead. Nothing . The following seven surprises are most common for new CEOs: These seven surprises for new CEOs carry some important lessons: First. you must remember that you are subject to a host of limitations. Michael Porter. Finally. How well and how quickly you understand. but you need to use it with extreme caution. • It is hard to know what is really going on. “You have more power than anybody else in the corporation. First.not even running a large business within the company . . Second. has seven surprises for new CEOs. but you need to use it with extreme caution. He explained: “These surprises carry some important and subtle lessons. you are a few steps removed from many of the factors that drive results. • You are still only human. The seven most common surprises are: • You can't run the company. you must recognize that your position does not confer the right to lead. Second. Professor of Harvard Business School and acknowledged as the most influential living management thinker. South Africa’s global competitiveness and CSR initiatives. you are a few steps removed from many of the factors that drive results. But if you expect the job to be as simple as that. accept. you must remember that you are subject to a host of limitations. nor does it guarantee the loyalty of the organization. He will present a cutting-edge programme covering corporate strategy. You have more power than anybody else in the corporation. following his half-day workshop for the Global Leaders Africa Summit a year ago. nor does it guarantee the loyalty of the organisation. Porter et al have discovered that nothing not even running a large business within the company fully prepares a person to be the chief executive. you must learn to manage organisational context rather than focus on daily operations. and full access to the finer points of your business. • Pleasing shareholders is not the goal. the authority to make things happen. even though others might treat you as omnipotent. • You are always sending a message. “Finally. He says: “As a newly minted CEO.full responsibility for your company s well-being. • You are not the boss.

as well as a practical. then managers must give attention to both sets of job factors. The two-factor. If. If management is equally concerned with both (as is usually the case). Instead. he found that job characteristics related to what an individual does — that is. influence on attitudes toward administration[2]. technical problems. and working conditions[1]. . this appears to parallel Maslow's theory of a need hierarchy. a psychologist. status. personal worth. dissatisfaction results from unfavorable assessments of such job-related factors as company policies. Herzberg added a new dimension to this theory by proposing a twofactor model of motivation. it should be concerned with the nature of the work itself — the opportunities it presents for gaining status. or motivation-hygiene theory. recognition. individuals look for the gratification of higher-level psychological needs having to do with achievement. So far. responsibility. based on the notion that the presence of one set of job characteristics or incentives lead to worker satisfaction at work. supervision. interpersonal relations on the job. Thus. thus making him happy and satisfied. and the nature of the work itself. on the other hand. individuals are not content with the satisfaction of lower-order needs at work. developed from data collected by Herzberg from interviews with a large number of engineers and accountants in the Pittsburgh area. while a separate set of factors cause dissatisfaction. It was developed by Frederick Herzberg. who theorized that job satisfaction and job dissatisfaction act independently of each other. However.and confront the seven surprises will have a lot to do with your success or failure as a CEO. and working conditions. competency. This theory suggests that to improve job attitudes and productivity. supervision. the absence of such gratifying job characteristics does not appear to lead to unhappiness and dissatisfaction. Rather. From analyzing these interviews. assuming responsibility. salary. advancement. for example. administrators must recognize and attend to both sets of characteristics and not assume that an increase in satisfaction leads to decrease in unpleasurable dissatisfaction. while another and separate set of job characteristics lead to dissatisfaction at work. satisfaction and dissatisfaction are not on a continuum with one increasing as the other diminishes. His findings have had a considerable theoretical. management wishes to reduce dissatisfaction. However. procedures. to the nature of the work he performs — apparently have the capacity to gratify such needs as achievement. According to Herzberg. and for achieving self-realization. but are independent phenomena. Attitudes and their connection with industrial mental health are related to Maslow's theory of motivation. those associated with minimum salary levels or safe and pleasant working conditions. Thus. and self-realization. then it must focus on the job environment — policies. if management wishes to increase satisfaction on the job.” TWO FACTOR THEORY The two-factor theory (also known as Herzberg's motivation-hygiene theory) states that there are certain factors in the workplace that cause job satisfaction.

and include aspects such as company policies. for example. the dissatisfiers (company policy and administrative practices. Motivation factors are needed to motivate an employee to higher performance. though dissatisfaction results from their absence. and Hygiene factors (e. who offered little data to support his ideas. Here is the description of this interview analysis: Briefly. achievement. challenging work. and to provide reasons. chosen because of their professions' growing importance in the business world. if you perform a work related action because you have to then that is classed as movement. interpersonal relationships. or wages/salary[4]. but if you perform a work related action because you want to then that is classed as motivation.The theory was based around interviews with 203 American accountants & engineers in Pittsburgh.g. Conversely. The subjects were asked to relate times when they felt exceptionally good or bad about their present job or any previous job. and advancement) are mostly unipolar. Herzberg also further classified our actions and how and why we do them. Herzberg and others have presented considerable empirical evidence to confirm the motivation-hygiene theory. arising from intrinsic conditions of the job itself. salary and fringe benefits) that do not give positive satisfaction. job security. and salary) contribute very little to job satisfaction[3]. they contribute very little to job dissatisfaction.g. intrinsic interest in the work. we asked our respondents to describe periods in their lives when they were exceedingly happy and unhappy with their jobs. recognition. Unlike Maslow. status. Each respondent gave as many "sequences of events" as he could that met certain criteria—including a marked change in feeling. . supervisory practices. responsibility) that give positive satisfaction.. although their work has been criticized on methodological grounds. hygiene factors are needed to ensure an employee is not dissatisfied. These are extrinsic to the work itself. or personal growth[4].  Essentially. working conditions. and contained some substantive description other than feelings and interpretations… The proposed hypothesis appears verified. supervision. a beginning and an end. The factors on the right that led to satisfaction (achievement. that is. responsibility. such as recognition. and a description of the sequence of events giving rise to that positive or negative feeling. Two-factor theory distinguishes between:  Motivators (e.

Skandia Navigator Measuring Intangible Assets Software .

Nevertheless. maybe even departments in these companies. Skandia applies the BSC idea to the Navigator by applying measures to monitor critical business success factors under each of five focuses: financial. are not required to adopt a set form or number of measures. customer. because the Navigator is primarily seen as a navigation tool and not one that provides detailed implementation guidelines. the Navigator is adopted widely across Skandia and has been incorporated in the MIS system of Skandia under the Dolphin system. "What are the critical factors that enable us to achieve success under each of the focus areas?" Then a number of indicators designed to reflect both present and future performance under these factors are chosen. They are not even required to report on the same indicators from year to year. and renewal. "What are the key success factors for the measuring entity in general?" The entity then asks. The companies that comprise the Skandia Corporation. human. Under the Navigator model. the measuring entity—whether the organization or individual business units or departments—asks the question.The leading feature of Skandia's Navigator is its flexibility. process. "What are the indicators that are needed to monitor present and future . Edvinsson explains that the measuring entity may also have a different starting point by asking. Skandia still believes in the value of learning through taking an experimental approach. Despite its pioneering work and leadership in measuring IC.

The human focus tracked number of full-time employees. number of female managers. and a total of 24 were selected for tracking. For example. For the satisfied customer factor. implementing efficient administrative routines. this generated the following indicators: • Satisfied customer index • Customer barometer • New sales • Market share • Lapse rate • Average response time at the call center • Discontinued calls at the call center • Average handling time for completed cases • Number of new products These indicators are then grouped under the various focuses. the overall set of indicators for a certain period (strategic phase) that the Navigator model monitors also changes. the IT department used the following measures: Under the financial focus. The indicators included number of contracts. The customer focus looked at the contracts that the department handled for Skandia-affiliated companies. Not only does the Navigator allow this high level of flexibility in the choice of indicators from time to time. and training expense/ employee. these measures are examined and placed under the five focuses depending on what they purport to measure. for example. Each of these "success factors" generated a set of indicators. but it also encourages individual employees to express their goals and monitor their own and their team's performance. the department measured return on capital employed. In one example. These included establishing long-term relationships with satisfied customers. establishing long-term relationships with distributors (particularly banks). SkandiaLink asked senior managers to identify five separate key success factors for the company in 1997.performance for the chosen success factors?" Once these are determined. and employing satisfied and competent employees. the Navigator model was used by Skandia's corporate IT to monitor its vision of making IT the company's competitive edge. savings/contract. operating results. Finally. number of managers. creating an IT system that supports operations. surrender ratio. and points of sale. Under the process focus the . As key success factors change. and value added/employee. as many measures as necessary are chosen to monitor them. To that end.

The details can be filled in later as management steers the business toward meeting its strategic goals. With time the Dolphin system will probably lead to streamlining the various "navigators. two out of five companies looked at employee turnover. while the other companies focused on the number of full-time employees in addition to or instead of training hours. As a result. In Skandia's IC Supplement. published in 1994. . which can then be integrated with traditional financial accounting". with the exception of recurring generic indicators like customer and employee satisfaction. But even with generic measures. Being flexible and idiosyncratic to the needs of the measuring unit. to an extent that it reported these measures to external stakeholders. Value reporting framework pwc The insights gained from our global research programme have been codified into PricewaterhouseCoopers corporate reporting framework. through the Dolphin system. strategy and structure. and IT/administrative expense.46 each of Skandia's companies reported and monitored a different set of indicators reflecting the strategies and key success factors of each. Skandia wants the Navigator to be a tool for plotting a course rather than a detailed guideline. Despite inconsistencies and the huge number of indicators generated. Compared to the BSC model. the number of indicators generated for the whole organization was enormous. while at the same time allowing each measuring unit to develop its own dialect. as an indicator of employee satisfaction under the human focus. In 1993. It seems that Skandia is serious about communication despite the inconsistency of the measures used. the same measures were not used consistently. the Navigator ensures that the whole organization talks IC. Skandia appointed an IC (as opposed to financial) controller to "systemically develop intellectual capital information and accounting systems. Though IC reporting requires more consistent measures. The number of indicators under each focus and the factors that each company attempted to monitor were different. Skandia automated the Navigator. both companies and investors consider critical to assessing performance. or a well-defined model. and performance. where the measures are more or less prescribed." and give rise to a more consistent set of indicators through sharing and communication. and incorporated it into its management information system (MIS). according to our research. The underlying philosophy is to provide the highest level of flexibility within a defined framework. managing for value. all underpinned by relevant performance measures. Skandia appears determined to balance between its desire to provide transparency on how their organization is being run while continuing to experiment with the Navigator. Each of these broad categories encompasses specific elements that. The framework identifies four broad categories of information that all industries and companies share in common: market overview. For example.department measured the number of contracts per employee. administrative expense/gross premiums written. the Navigator's underlying philosophy allows for multiple variations.

Integrated reporting refers to the integrated representation of a company’s performance in terms of both financial and non-financial results. Companies reporting using this framework. Integrated reporting provides greater context for performance data." [1] Companies that produce integrated reports include BASF. integrated reporting is referred to in this manner: "A key challenge for leadership is to make sustainability issues mainstream. more investors are going . often online. BT and HSBC.[2] Corporate reporting on financial and non-financial information in a single document has grown as socially responsible investing (SRI) has grown faster than the investment industry overall. clarifies how sustainability fits into operations or a business. the SRI market has grown at an annual rate of 22% since 2003. risk.As our ongoing research has expanded across industries and as our experience in applying our knowledge to the real world of corporate reporting has grown. Novo Nordisk. The Prince of Wales' Accounting for Sustainability project introduced the Connected Reporting Framework in 2007. Strategy. In the King III Report (otherwise known as King Code of Governance for South Africa 2009). In 2008. for specific stakeholder groups. hence the phrase ‘integrated reporting’ which is used throughout this Report. which links sustainability performance reporting with financial reporting and strategic direction in a connected way. the corporate reporting framework has evolved. UTC was the first Dow Jones Industrial Average member to produce an integrated report. while global growth rates for assets under management have stagnated around 10%. include Aviva. performance and sustainability have become inseparable. Globally.[3] As more assets are managed with SRI frameworks. Phillips. and may help embed sustainability into company decision making. United Technologies Corporation (UTC) and American Electric Power (AEP). Some companies that report in an integrated manner also report additional sustainability information. Our industry-specific research and analysis enables us to tailor the framework by highlighting the elements that are most important to a particular industry.

and The Prince's Accounting for Sustainability Project are collaborating to establish an International Integrated Reporting Committee (IIRC) to oversee the development of global integrated reporting standards and guidelines. Altman Z-score The Z-score formula for predicting bankruptcy was published in 1968 by Edward I. with matching by industry and approximate size (assets). Altman applied the statistical method of discriminant analysis to a dataset of publicly held manufacturers.033T3 + 0. The original data sample consisted of 66 firms. at the time. T1 = Working Capital / Total Assets. The Z-score is a linear combination of four or five common business ratios.014T2 + 0. Altman. The coefficients were estimated by identifying a set of firms which had declared bankruptcy and then collecting a matched sample of firms which had survived.beyond financial information to consider non-financial.999T5. All businesses in the database were manufacturers. IFAC (International Federation of Accountants). weighted by coefficients. extra-financial or environmental. who was. Z-scores are used to predict corporate defaults and an easy-to-calculate control measure for the financial distress status of companies in academic studies. It recognizes operating earnings as being important to long-term viability. T2 = Retained Earnings / Total Assets.012T1 + 0. and small firms with assets of <$1 million were eliminated.006T4 + 0. non-manufacturing and service companies. Measures profitability that reflects the company's age and earning power. social and governance (ESG) information in investment decisions. The Zscore uses multiple corporate income and balance sheet values to measure the financial health of a company. an Assistant Professor of Finance at New York University. Measures operating efficiency apart from tax and leveraging factors. The estimation was originally based on data from publicly held manufacturers. Measures liquid assets in relation to the size of the company. . half of which had filed for bankruptcy under Chapter 7. but has since been re-estimated based on other datasets for private manufacturing. The original Z-score formula was as follows: Z = 0. T3 = Earnings Before Interest and Taxes / Total Assets. the Global Reporting Initiative (GRI). The formula may be used to predict the probability that a firm will go into bankruptcy within two years.

. and the only marketing paper in the list. This model has been widely influential in marketing and management science. Altman found that the ratio profile for the bankrupt group fell at -0. Everett Rogers published Diffusion of Innovations.48 avg. Bass contributed some mathematical ideas to the concept. a highly influential work that described the different stages of product adoption. It was ranked number five. Standard measure for sales turnover (varies greatly from industry to industry).[2] Prior to this. Frank Bass published his paper "A new product growth model for consumer durables" in 1969. The model is widely used in forecasting. Adds market dimension that can show up security price fluctuation as a possible red flag T5 = Sales/ Total Assets. It was subsequently reprinted in the December 2004 issue of Management Science. the basic Bass diffusion is a Riccati equation with constant coefficients. Mathematically.25 avg. and for the non-bankrupt group at +4. A company's Z score is a positive function of five factors: (net working capital) / (total assets) (retained earnings) / (total assets) (EBIT) / (total assets) (market value of common and preferred) / (book value of debt) (sales) / (total assets). In 2004 it was selected as one of the ten most frequently cited papers in the 50-year history of Management Science [4]. the higher the Z score and the lower the probability of bankruptcy Also called Zeta BASS DIFFUSION MODEL The Bass diffusion model was developed by Frank Bass and describes the process of how new products get adopted as an interaction between users and potential users.T4 = Market Value of Equity / Book Value of Total Liabilities. Z Score Analysis A company failure or bankruptcy prediction method developed by Professor Edward Altman of New York University. especially product forecasting and technology forecasting. along with the Dirichlet model of repeat buying and brand choice. Although the weights are not equal. It has been described as one of the most famous empirical generalisations in marketing. the higher each ratio.

e.Model formulation [2] Where:     is the rate of change of the installed base fraction is the installed base fraction is the coefficient of innovation is the coefficient of imitation multiplied by the Sales is the rate of change of installed base (i. adoption) ultimate market potential : [2] The time of peak sales [2] [edit]Explanation .

38. The coefficient q is called the coefficient of imitation. Typical values of p and q when time t is measured in years:[5]   The average value of p has been found to be 0.3 and 0.5 Extensions to the model Generalised Bass model (with pricing) . external influence or advertising effect.01 The average value of q has been found to be 0. and is often less than 0. internal influence or wordof-mouth effect. with a typical range between 0.The coefficient p is called the coefficient of innovation.03.

g. only one of these reduces to the Bass model under ordinary circumstances. Relationship with other s-curves There are two special cases of the Bass diffusion model. Norton and Bass extended the model in 1987 for sales of products with continuous repeat purchasing. . but that the shape of the curve is always similar. Although many extensions of the model have been proposed. This means that decision variable can shift the Bass curve in time.[4]. This model was developed in 1994 by Frank Bass. The formulation for three generations is as follows:[4] where     is the incremental number of ultimate adopters of the ith generation product is the average (continuous) repeat buying rate among adopters of the ith generation product is the time since the introduction of the ith generation product  It has been found that the p and q terms are generally the same between successive generations. despite a wide range of managerial decision variable. Trichy Krishnan and Dipak Jain: where is a function of percentage change in price and other variables Successive generations Technology products succeed one another in generations. e.Bass found that his model fit the data for almost all product introductions. pricing and advertising.

Use in online social networks The rapid. Sincerity (down-to-earth. The Bass model is a special case of the Gamma/shifted Gompertz distribution (G/SG). o Family-oriented. pp 347-356) is a framework to describe and measure the “personality” of a brand in five core dimensions. AN EXPLANATION OF THE TRAITS BELONGING TO EACH OF THE FACETS These traits are: o o Down-to-earth o Down to earth. Here's what Ms. charming) Ruggedness (outdoorsy. cheerful) Excitement (daring. intelligent. The trait measurements are done using a five point scale (1 = not at all descriptive. and her father before her. Aaker. The Bass diffusion model is used to estimate the size and growth rate of these social networks. when the model reduces to the Exponential distribution. wholesome.  The first special case occurs when q=0. successful) Sophistication (upper class. up-to-date) Competence (reliable. spirited. each divided into a set of facets. 3. The second special case reduces to the logistic distribution. researched: THE FIVE CORE DIMENSIONS AND THEIR FACETS These are: 1. 2. recent (as of early 2007) growth in online social networks (and other virtual communities) has led to an increased use of the Bass diffusion model. I believe that it's imperative that a brand be carefully "humanized" in order to connect with the audience. 4. honest. o Small-town Honest o Honest . It is a model to describe the profile of a brand by using an analogy with a human being. 5. imaginative. when p=0. 8/97. 5 = extremely descriptive) rating the extent to which each trait describes the specific brand. BRAND PERSONALITY AAKER The Brand Personality Dimensions of Jennifer Aaker (Journal of Marketing Research. tough) Each facet is in turn measured by a set of traits.

o o o o o o o o o o o o Sincere Real Wholesome o Wholesome o Original Cheerful o Cheerful o Sentimental o Friendly Daring o Daring o Trendy o Exciting Spirited o Spirited o Cool o Young Imaginative o Imaginative o Unique Up to date o Up to date o Independent o Contemporary Reliable o Reliable o Hard working o Secure Intelligent o Intelligent o Technical o Corporate Successful o Successful o Leader o Confident Upper class o Upper class o Glamorous o Good looking Charming o Charming o Feminine o Smooth Outdoorsy o o .

imaginative. So. I’m actually feeling kind of lazy and thinking about the screening of the documentary I worked on earlier this year. 2nd Dimension – EXCITEMENT The most exciting brands are daring. wholesome. spirited. and possibly uttered it yourself. and such I am going to post a quick break down of the 5 dimensions of brand personality.o o o o Outdoorsy Masculine Western Tough Rugged Tough o o 5 Dimensions of Brand Personality It’s Saturday. success or failure is dependent upon the consumers’ buying in to what they’re selling. and companies spend millions on advertising and marketing activities so that they can influence what those associations might be. because I am feeling lazy. and not in the mood to post some lengthy piece with loads of pictures. Just as we each chooses our friends based on their personalities. Consumers make purchasing decisions based on any number of factors they associate with individual brands. Sure. In light of this. the products bearing the Burton name are designed with their audience in mind. brands can elicit the same sort of response in consumers. because it happens to be true. honest. it’s good thing for us that someone has studied this and given us a few answers: 1st Dimension – SINCERITY Consumers interpret sincere brands as being down-to-earth. 3rd Dimension – COMPETENCE . No matter what the product or service that an organization is offering to its target audience. (I just saw a bunch of you roll your eyes. some people find Rachael Ray annoying. Not only are Burton snowboards on the cutting edge of technology and performance. Funky graphics and forward-thinking designs make Burton a leader in their competitive industry. and I have spent the morning reading and drinking coffee. but more people find her endearing – the kind of woman you can sit down with for a chat at the kitchen table.) How many times have you heard the statement. “the consumer owns the brand”? It would probably be safe to say you’ve heard it a dozen or so times. and cheerful. and on the cutting edge. wouldn’t it be interesting to know which human personality traits consumers tend to apply to brands? Well.

In good times and bad. which involves assessing potential threats and finding the best ways to avoid those threats. there are a few financial services firms that still manage to play well in consumer minds. Communication that occurs within the response phase of emergency management scenarios. Even in these trying economic times. The North Face has built an empire by outfitting people who actually do scary outdoorsy things. smart guy next door who can tell you what to do with your 401k allocations. 4th Dimension – SOPHISTICATION A brand that is sophisticated is viewed as charming and fit for the upper classes. (b) the element of surprise. the event could more accurately be described as a failure or incident. Three elements are common to most definitions of crisis: (a) a threat to the organization. CRISIS MANAGEMENT Crisis management is the process by which an organization deals with a major event that threatens to harm the organization. crisis management involves dealing with threats after they have occurred. 5th Dimension – RUGGEDNESS Interestingly. or the general public. understand. and those who just like to look good on the streets of NYC. . Crisis management consists of: Methods used to respond to both the reality and perception of crises. especially from the moment it first occurs to the point that recovery procedures start. and success are the traits associated with these brands. It is a discipline within the broader context of management consisting of skills and techniques required to identify. consumers pick up on this personality dimension quite well.[1] Venette[2] argues that "crisis is a process of transformation where the old system can no longer be maintained. If change is not needed. and (c) a short decision time." Therefore the fourth defining quality is the need for change. intelligence. Charles Schwab is the stable. Rugged brands are seen as outdoorsy and tough. assess. this brand remains strong as a symbol of a life lived in all the right places. its stakeholders. successful. In contrast to risk management. Establishing metrics to define what scenarios constitute a crisis and should consequently trigger the necessary response mechanisms.Reliability. the Chanel brand is unequaled. When it comes to esteem and seemingly eternal longevity. doing all the right things. and cope with a serious situation.

There must be open and consistent communication throughout the hierarchy to contribute to a successful crisis communication process. but crises can be clustered. [3] The credibility and reputation of organizations is heavily influenced by the perception of their responses during crisis situations. although it is probably untrue to say that Crisis Management represents a failure of Risk Management since it will never be possible to totally mitigate the chances of catastrophes occurring. During the crisis management process. Lerbinger categorized seven types of crises Natural disaster Technological crises Confrontation Malevolence Crisis of skewed management value Crisis of deception Crisis of management misconduct Crisis Management Model Successfully defusing a crisis requires an understanding of how to handle a crisis – before they occur.g. moving operations to another site). Crisis is also a facet of risk management. Gonzalez-Herrero and Pratt found the different phases of Crisis Management.Crisis management methods of a business or an organization are called Crisis Management Plan. it is important to identify types of crises in that different crises necessitate the use of different crisis management strategies. The related terms emergency management and business continuity management focus respectively on the prompt but short lived "first aid" type of response (e. There are 3 phases in any Crisis Management are as below . putting the fire out) and the longer term recovery and restoration phases (e.Potential crises are enormous. The organization and communication involved in responding to a crisis in a timely fashion makes for a challenge in businesses. Crisis management is occasionally referred to as incident management. although several industry specialists such as Peter Power argue that the term crisis management is more accurate.g.

such as the company spokesperson or crisis team members. the team members will act more quickly and effectively. Management Crisis Planning No corporation looks forward to facing a situation that causes a significant disruption to their business. information should be accurate. but the long-term effects of every decision. First. Providing incorrect or manipulated information has a tendency to backfire and will greatly exacerbate the situation. legal and government impact. Then each critical function and or/process must have its own contingency plan in the event that one of the functions/processes ceases or fails. As a result. and the plan should indicate how quickly each function should be performed. Business continuity planning When a crisis will undoubtedly cause a significant disruption to an organization. a business continuity plan can help minimize the disruption. political. especially one that stimulates extensive media coverage. Contingency planning Preparing contingency plans in advance. so working with speed and efficiency is important. Testing these contingency plans by rehearsing the required actions in a simulation will allow for all involved to become more sensitive and aware of the possibility of a crisisis. Public scrutiny can result in a negative financial. Crisis management planning deals with providing the best response to a crisis. The contingency plan should contain information and guidance that will help decision makers to consider not only the shortterm consequences. Crisis management teams can rehearse a crisis plan by developing a simulated scenario to use as a drill. one must identify the critical functions and processes that are necessary to keep the organization running. The plan should clearly stipulate that the only people to speak publicly about the crisis are the designated persons. Structural-functional systems theory addresses the intricacies of information networks and levels of command making up organizational communication. Structural-functional systems theory Providing information to an organization in a time of crisis is critical to effective crisis management. The structural-functional theory identifies information flow in organizations as . The first hours after a crisis breaks are the most crucial. is the first step to ensuring an organization is appropriately prepared for a crisis. in the event of an actual crisis.1 The diagnosis of the impending trouble or the danger signals 2. as part of a crisis management plan. When preparing to offer a statement externally as well as internally. Choosing appropriate Turnaround Strategy 3 Implementation of the change process and its monitoring.

The affable CEO. California. At Mattel.through the help of consultants effective thermal processes that would not harm the products' flavors when production resumed.[18] Mattel Mattel Inc. invited them to a teleconference call with executives and scheduled TV appearances or phone conversations with Mattel's chief executive. In October 1996. the toy maker.[16] When another bottle of tainted Tylenol was discovered in a store. Fortynine cases were reported. faced two product recall in two weeks. coli poisoning. coli infection. expressed remorse. an outbreak of E. they were appreciative of the company's response."networks" made up of members and "links". including the death of a small child. a murderer added 65 milligrams of cyanide to some Tylenol capsules on store shelves. Colorado and British Columbia was traced to unpasteurized apple juice manufactured by natural juice maker Odwalla Inc. All of these steps were communicated through close relations with the media and through full-page newspaper ads. earning high marks from consumers and retailers. has been plagued with more than 28 product recalls and in Summer of 2007. Though upset by the situation. established a schedule of daily press briefings.[17] Odwalla Foods When Odwalla's apple juice was thought to be the cause of an outbreak of E. detailed symptoms of E. Tamper-resistant packaging was rapidly introduced. Odwalla conferred with the FDA and Washington state health officials. Odwalla then developed . Information in organizations flow in patterns called networks Examples of successful crisis management Tylenol (Johnson and Johnson) In the fall of 1982. Within 24 hours. Johnson & Johnson recalled and destroyed 31 million capsules at a cost of $100 million.m. including three in one family. the company lost a third of its market value. just after the 7 a. recall announcement by federal officials. James Burke. coli bacteria in Washington state. it took only a matter of minutes for the manufacturer to issue a nationwide warning that people should not use the medication in its capsule form. They told each to check their e-mail for a news release outlining the recalls. The company "did everything it could to get its message out. a public relations staff of 16 was set to call reporters at the 40 biggest media outlets.. and took responsibility for anyone harmed by their products. and explained what consumers should do with any affected products. sent out press releases which announced the recall. appeared in television ads and at news conferences informing consumers of the company's actions. and Tylenol sales swiftly bounced back to near pre-crisis levels. The Mattel CEO Robert Eckert did 14 TV interviews on a Tuesday in August and about 20 calls with . concern and apology. amongst problems with exports from China. killing seven people.

These tires were mostly used on the Ford Explorer.individual reporters. This led to an arrest. This case served as a design for how to handle other crisis situations. showing the production process to demonstrate that such tampering was impossible within their factories. spectacular crashes— Bridgestone/Firestone recalled 6. and every employee of Pepsi was kept aware of the details. which Pepsi made public and then followed with their first video news release.S. a crisis management strategy can help upper management make more calculated decisions in how they should respond to disaster scenarios. alone. along with coupons for further compensation.[21] Ford and Firestone Tire and Rubber Company The Ford-Firestone Tire and Rubber Company dispute transpired in August 2000. local residents were not sure how to react to warnings of potential threats from the Union Carbide plant. The corporation was completely open with the public throughout. Symbolic intervention can be counter productive. According to American University’s Trade Environmental Database Case Studies (1997). The company simultaneously publicly worked with the FDA during the crisis."[19] Pepsi The Pepsi Corporation faced a crisis in 1993 which started with claims of syringes being found in cans of diet Pepsi.[citation needed] This made public communications effective throughout the crisis. Pepsi urged stores not to remove the product from shelves while it had the cans and the situation investigated. and after the crisis cost thousands of lives. After the crisis had been resolved.5 million tires.[22] . illustrates the importance of incorporating cross-cultural communication in crisis management plans. the world's top-selling sport utility vehicle (SUV).[20][citation needed] Examples of unsuccessful crisis management Bhopal The Bhopal disaster in which poor communication before. In response to claims that their 15-inch Wilderness AT. during. radial ATX and ATX II tire treads were separating from the tire core—leading to grisly. the corporation ran a series of special campaigns designed to thank the public for standing by the corporation. Mattel had responded to more than 300 media inquiries in the U. A second video news release displayed the man arrested. A third video news release showed surveillance from a convenience store where a woman was caught replicating the tampering incident. Operating manuals printed only in English is an extreme example of mismanagement but indicative of systemic barriers to information diffusion. By the week's end. a day after the crisis Union Carbide’s upper management arrived in India but was unable to assist in the relief efforts because they were placed under house arrest by the Indian government. According to Union Carbide’s own chronology of the incident (2006). The Bhopal incident illustrates the difficulty in consistently applying management standards to multi-national operations and the blame shifting that often results from the lack of a clear management plan.

Then they said very little about what they were doing to solve a problem that had caused more than 100 deaths—until they got called to Washington to testify before Congress. on other groups such as the Coast Guard. the company did not appoint a public relations manager to its management team until 1993. relative to the identity of competing products. positioning has come to mean the process by which marketers try to create an image or identity in the minds of their target market for its product. killing thousands of fish. relative to the identity of your own product. These responses also happened within days of the incident. Yahoo . 4 years after the incident. by contrast. and sea otters. In the classic example of Avis claiming "No. 1989. We Try Harder". the company had neither a communication plan nor a communication team in place to handle the event—in fact. a tanker belonging to the Exxon Corporation ran aground in the Prince William Sound in Alaska. especially Native Americans. numerous fishermen. even laying blame. De-positioning involves attempting to change the identity of competing products. An important component of hi-tech marketing in the age of the World Wide Web is positioning in major search engines such as Google. they blamed consumers for not inflating their tires properly. in the collective minds of the target market. did not react quickly in terms of dealing with the media and the public. Then they blamed each other for faulty tires and faulty vehicle design. First. fowl.[23] Exxon On March 24. at times. brand. in the collective minds of the target market. The Exxon Valdez spilled millions of gallons of crude oil into the waters off Valdez. the CEO. the point was to say something so shocking (it was by the standards of the day) that it cleared space in your brain and made you forget all about who was #1. and not to make some philosophical point about being "hungry" for business. or organization. Exxon established its media center in Valdez. Hundreds of miles of coastline were polluted and salmon spawning runs disrupted. a location too small and too remote to handle the onslaught of media attention. Lawrence Rawl. The growth of high-tech marketing may have had much to do with the shift in definition towards competitive positioning. Re-positioning involves changing the identity of a product.2. The original work on Positioning was consumer marketing oriented. POSITIONING TROUT In marketing. Exxon. and the company acted defensively in its response to its publics. say crisis experts. and was not as much focused on the question relative to competitive products as much as it was focused on cutting through the ambient "noise" and establishing a moment of real contact with the intended recipient. did not become an active part of the public relations effort and actually shunned public involvement.The two companies committed three major blunders early on. lost their livelihoods.

Generally. 19 of 2001 paperback edition) What most will agree on is that Positioning is something (perception) that happens in the minds of the target market. price. distribution. which tends to be web oriented in their shopping and purchasing habits as a result of being highly connected and involved in social media in general. which can be accomplished through Search Engine Optimization. It will happen whether or not a company's management is proactive.June/1969) and then popularized by Al Ries and Jack Trout in their bestseller book "Positioning . It is the aggregate perception the market has of a particular company. in which the case is made that the typical consumer is overwhelmed with unwanted advertising. product or service in relation to their perceptions of the competitors in the same category. It was then expanded into their ground-breaking first book. Also positioning is defined as the way by which the marketers creates impression in the customers mind. Positioning is a concept in marketing which was first introduced by Jack Trout ( "Industrial Marketing" Magazine. and has a natural tendency to discard all information that does not immediately find a comfortable (and empty) slot in the consumers mind.and Bing. the product positioning process involves: Defining the market in which the product or brand will compete (who the relevant buyers are) Identifying the attributes (also called dimensions) that define the product 'space' Collecting information from a sample of customers about their perceptions of each product on the relevant attributes . reactive or passive about the on-going process of evolving a position. This is an especially important component when attempting to improve competitive positioning among a younger demographic. But a company can positively influence the perceptions through enlightened strategic actions. product or service utilizing traditional marketing placement strategies (i.The Battle for Your Mind. and competition). probably the most common is: identifying a market niche for a brand. Although there are different definitions of Positioning. It is based on the concept that communication can only take place at the right time and under the right circumstances" (p. also known as SEO.e. packaging. promotion. "Positioning: The Battle for Your Mind." (McGraw-Hill 1981) This differs slightly from the context in which the term was first published in 1969 by Jack Trout in the paper "Positioning" is a game people play in today’s me-too market place" in the publication Industrial Marketing." in which they define Positioning as "an organized system for finding a window in the mind.

don't have the physical attributes of products . Functional positions  Solve problems  Provide benefits to customers  Get favorable perception by investors (stock profile) and lenders 2. 2010) The process is similar for positioning your company's services. will only be effective if the brand itself stays close to its roots of uniqueness and core values. watch their facial expressions and listen for their response. there are three types of positioning concepts: 1. More generally.that is. however. you'll know you're on the right track. we can't feel them or touch them or show nice product pictures. Test it on people who don't really know what you do or what you sell. what value do clients get from my services? How are they better off from doing business with me? Also ask: is there a characteristic that makes my services different? Write out the value customers derive and the attributes your services offer to create the first draft of your positioning.Determine each product's share of mind Determine each product's current location in the product space Determine the target market's preferred combination of attributes (referred to as an ideal vector) Examine the fit between: The position of your product The position of the ideal vector Position. Symbolic positions  Self-image enhancement  Ego identification  Belongingness and social meaningfulness  Affective fulfillment 3. (Faheem. Experiential positions  Provide sensory stimulation  Provide cognitive stimulation Brand management in highly competitive and dynamic markets. The two . When they want to know more because you've piqued their interest and started a conversation. focuses on specific market segments and captures a competitive positioning in a specific market. So you need to ask first your customers and then yourself. Services.

To position a brand efficiently within its market. It's the rational and persuasive reason to buy the brand in highly competitive target markets (Kotler & Keller. 2006:310). 3. whereas brand positioning a competitive orientated combat tool fulfils on the short term. brand identity to express the brand tangible and intangible unique characteristics on the long term. to position the brand successful in the mind of customers and prospects (Trout. every mismatch will be filtered out and blocked. 1995:3-8): 1. 2001:2-5). For this reason. management needs to understand five mental elements in the positioning process. "Learning is simply remembering what we're interested in" (Trout. 2001:29). Minds are limited • • • According to social scientists our selective process has at least three rings of defence: (1) selective exposure.brand management tools that could fulfil that role are brand identity and brand positioning. (3) selective retention (Trout. but to manipulate the mind set and to retie existing connections (Ries & Trout. The mind accepts only (new) information which matches its current mindset. customers and prospect in particular. 2007:95-102). Kotler and Keller define brand positioning as an "act of designing the company's offering and image to occupy a distinct place in the mind of the target market." The objective of positioning is to locate the brand into the minds of stakeholders. 1995:11-24). 2001:193-206). Minds are insecure . Therefore it is essential to understand and to know the position a brand owns in the mind of a customer instead of defining what the brand stands for. 2. Positioning communicates a specific aspect of identity at a given time in a given specific market segment within a field of competition. (Ries & Trout. Brand identity and brand positioning need to be connected within their own specific functions. Minds hate confusion • To avoid confusion emphasize simplicity and focus on the most obvious powerful attribute and position it well into the mind (Trout. it is critical to evaluate the brand objectively and assess how the brand is viewed by customers and prospects (Ries & Trout. (2) selective attention. Trout suspects that people discriminate information to access their mind as a self-defence mechanism. Positioning the brand in highly over-communicated B2B environments could easily fail when the minds of customers and prospect obviously get confused. Brand positioning is the sum of all activities that position the brand in the mind of the customer relative to its competition. Hence positioning derives from identity and may chance over time and/or differ per product (Kapferer. 1995:13). Positioning is not about creating something new or different. 1995:11-12). A recognizable and trusted customerfocused value proposition can be the result of a successful positioning without doing something to the product itself.

Minds tend to be emotional rather then rational. Often people tend to follow others as a principle, social proof to guide the insecure mind in making decisions and reduce the risk of doing something wrong. Behavioural scientists say there are five forms of perceived risk: (1) monetary risk, (2) functional risk, (3) physical risk, (4) social risk, (5) psychological risk (Trout, 1995:25-28)

4. Minds don't change

• •

According Petty and Cacioppo (as quoted in Trout, 1995:35)"...beliefs are thought to provide the cognitive foundation of an attitude. In order to change an attitude, then, it is presumably necessary to modify the information on which that attitude rests. It is generally necessary, therefore, to change a person's belief, eliminate old beliefs, or introduce new beliefs." Once the market has made up it mind about a brand it is impossible to chance that mind (Trout, 1995:34). In general, the mind is sensitive to prior knowledge or experience. (Ries & Trout, 2001:6) At the end it comes back to what the market is familiar and already comfortable with (Trout, 1995:34-35).

5. Minds can lose focus

Variations to the brand, for example line extensions, can leverage the distortion of minds, in other words: the mind loses focus. To enforce the mindset it is necessary to stay focussed and consistent on the key attributes of the brand.

Positioning is in essence a strategy to position the brand against other brands (Trout, 1995:146). Consequently, positioning requires a balance of ideal points of parity and point of different brand associations within the given market and competitive environment. Establishing brand positioning starts with identifying: (1) the target market, (2) the nature of competition, (3) the points of parity (POP), and (4) the points of difference (POD) (Keller, 2006:98-99). Marketeers can use a brand mantra to emphasize the core brand associations that reflects the "heart and soul" of the brand. The brand mantra is a three- to five-word (phrase) that captures the indisputable "heart and soul"; the essence or spirit, of the brand positioning. The brand mantra communicates what the brand is and what it is not. Next to that, it can provide a brand guidance to appropriate product extension, line extension, acquisitions and mergers, internal communication. A brand mantra provides (as well) a short list of crucial brand considerations which leverage a consistent brand image and internal branding. Keller distinguish three determinant categories to design a brand mantra: (1) the emotional modifier, (2) the descriptive modifier, (3) the brand function (Keller, 2006:121-123). Positioning results from an analytical process based on four questions: (1) a brand for what, (2) a brand for whom, (3) a brand for when, (4) a brand against whom? Obviously it indicates the brand's distinctive characteristics, essential points of difference,

attractiveness to the market and "raison d'être". Kapferer's standard approach to achieve the desired positioning is based on four determinations; (1) definition of target market, (2) definition of the frame of reference and subjective category, (3) promise or consumer benefit, (4) reason to believe (Kapferer, 2007:100-102). According to Ries and Trout the secret of a successful position is to balance a unique position with an appeal that's not too narrow. Organizations should look for manageable smaller targets which deliver the appropriate and unique value proposition rather than a bigger homogeneous highly competitive market. Its success is captured by the willingness to sacrifice a minor role the total market in return for leadership in specific oligopolistic market segments (Ries & Trout, 2001:208). Treacy and Wiersema argue that leadership comes with a strong focus on delivering excellent customer value. Based on a three-year study of 40 companies they distinguish three value disciplines on which organizations should focus; (1) operational excellence, (2) customer intimacy, or (3) product leadership. See figure 18. The challenge for organizations is to sustain the chosen value disciple persistent through the organization and to create internal long term consistency. Two golden rules to success; (1) excel in one of the three value disciplines to create a leadership position and (2) deliver adequate level of excellence in the two other value disciplines (Treacy & Wiersema, 1993:3-14).

Value disciple model (Treacy & Wiersema, 1993,3) According to Kapferer there is a direct connection between the brand essence, brand identity and brand position that enables the brand to change over (long term) time within certain degrees of freedom and still remain it self. Brand positioning capitalizes on a specific part of identity within the playing field which varies by segment, demography, market dynamics and time. For that Kapferer argues that on a global level a unified

identity can initiate multiple specific market strategies for different markets without jeopardizing the brand essence and identity (Kapferer, 2007:105).

ENTERPRISE ARCHITECTURE ZACHMAN
The Zachman Framework is an Enterprise Architecture framework for enterprise architecture, which provides a formal and highly structured way of viewing and defining an enterprise. It consists of a two dimensional classification matrix based on the intersection of six communication questions (What, Where, When, Why, Who and How) with six rows according to reification transformations. The Zachman Framework is not a methodology in that it lacks specific methods and processes for collecting, managing, or using the information that it describes.The Framework is named after its creator John Zachman, who first developed the concept in the 1980s at IBM. It has been updated several times since. The Zachman "Framework" is a taxonomy for organizing architectural artifacts (in other words, design documents, specifications, and models) that takes into account both whom the artifact targets (for example, business owner and builder) and what particular issue (for example, data and functionality) is being addressed. The term "Zachman Framework" has multiple meanings. It can refer to any of the frameworks proposed by John Zachman: The initial framework, named A Framework for Information Systems Architecture, by John Zachman published in an 1987 article in the IBM Systems journal.[5] The Zachman Framework for Enterprise Architecture, an update of the 1987 original in the 1990s extended and renamed .[6] One of the later versions of the Zachman Framework, offered by Zachman International as industry standard.In other sources the Zachman Framework is introduced as a framework, originated by and named after John Zachman, represented in numerous ways, see image. This framework is explained as, for example: a framework to organize and analyze data[7], a framework for enterprise architecture.[8] a classification system, or classification scheme[9] a matrix, often in a 6x6 matrix format a two-dimensional model[10] or an analytic model.

a two-dimensional schema, used to organize the detailed representations of the enterprise. [11] Beside the frameworks developed by John Zachman numerous extensions and or applications have been developed, which are also sometimes called Zachman Frameworks. The Zachman Framework summarizes a collection of perspectives involved in enterprise architecture. These perspectives are represented in a two-dimensional matrix that defines along the rows the type of stakeholders and with the columns the aspects of the architecture. The framework does not define a methodology for an architecture. Rather, the matrix is a template that must be filled in by the goals/rules, processes, material, roles, locations, and events specifically required by the organization. Further modeling by mapping between columns in the framework identifies gaps in the documented state of the organization.[12] The framework is a simple and logical structure for classifying and organizing the descriptive representations of an enterprise. It is significant to both the management of the enterprise, and the actors involved in the development of enterprise systems.[13] While there is not order of priority for the columns of the Framework, the top-down order of the rows is significant to the alignment of business concepts and the actual physical enterprise. The level of detail in the Framework is a function of each cell (and not the rows). When done by IT the lower level of focus is on information technology, however it can apply equally to physical material (ball valves, piping, transformers, fuse boxes for example) and the associated physical processes, roles, locations etc. related to those items. Framework for enterprise architecture In the 1997 paper "Concepts of the Framework for Enterprise Architecture" Zachman explained that the framework should be referred to as a "Framework for Enterprise Architecture", and should have from the beginning. In the early 1980s however, according to Zachman, there was "little interest in the idea of Enterprise Reengineering or Enterprise Modeling and the use of formalisms and models was generally limited to some aspects of application development within the Information Systems community".[20] In 2008 Zachman Enterprise introduced the Zachman Framework: The Official Concise Definition as a new Zachman Framework standard.

The contractor must redraw the architect's plans to represent the builder's perspective. and how it would relate to the general environment in which it will operate. or other required supporting technology. They correspond to the system model designed by a systems analyst who must determine the data elements. technology. who will have to live with it in the daily routines of business. input/output (I/O) devices. Owner's View (Enterprise or Business Model) .The first architectural sketch is a "bubble chart" or Venn diagram.Next are the architect's drawings that depict the final building from the perspective of the owner. Designer's View (Information Systems Model) . which constitute the designs of the business and show the business entities and processes and how they relate. They correspond to the enterprise (business) models. which must adapt the information systems model to the details of the programming languages. Subcontractor View (Detailed Specifications) . Builder's View (Technology Model) . which depicts in gross terms the size. and functions that represent business entities and processes.The architect's plans are the translation of the drawings into detail requirements representations from the designer's perspective. logical process flows. It corresponds to an executive summary for a planner or investor who wants an overview or estimate of the scope of the system. with sufficient detail to understand the constraints of tools. partial relationships. The builder's plans correspond to the technology models. These correspond to the detailed specifications that are given to programmers who code individual .     Planner's View (Scope) . and materials. what it would cost. and basic purpose of the final structure.Subcontractors work from shop plans that specify the details of parts or subsections. shape.

[26] In addition. form the columns of the Zachman Framework and these are:[24] 1.e. and the underlying interrogatives that they answer. modules without being concerned with the overall context or structure of the system. and the flexing of those styles to varying circumstances at work. Leadership Styles at Work We believe that the focus of this type of training should be on the situational use of leadership styles. Because each of the elements on either axis is explicitly different from the others. but actually are different representations — different in context. The best leaders are skilled at several styles. the single factor that makes his framework unique is that each element on either axis of the matrix is explicitly distinguishable from all the other elements on that axis. meaning. models). and instinctively understand when to use them at work. Alternatively.. creating different descriptive representations (i. which translate from higher to lower perspectives. 3. The basic model for the focus (or product abstraction) remains constant. they could represent the detailed requirements for various commercial-off-the-shelf (COTS). it is possible to define precisely what belongs in each cell. The basic model of each column is uniquely defined. motivation. 5. then answers those questions from that viewpoint. 4. the six categories of enterprise architecture components. For example. This last point is an important one. and use. yet related across and down the matrix. each perspective focuses attention on the same fundamental questions. . or components of modular systems software being procured and implemented rather than built. The representations in each cell of the matrix are not merely successive levels of increasing detail. 6. Actual System View or The Functioning Enterprise Focus or Columns In summary. 2. what is the most effective style to use when placed in a certain situation? This is one of the guiding principals behind the various models of leadership styles. government off-the-shelf (GOTS). The data description — What The function description — How The Network description — Where The people description — Who The time description — When The motivation description — Why In Zachman’s opinion. Research has demonstrated that the leader's ability to adopt his or her leadership style to the situation at hand is important to their organization's success.

because the level of involvement required by this approach. however. can be very time consuming. If you're interested in the effective application of different leadership styles. This leader is easily recognized by their theme of . and is receptive to improvement suggestions or ideas. as well as the decision-making process.Choosing a Leadership Style In the following sections we are going to explain the six different leadership styles that were identified by Daniel Goleman in connection with his theory of emotional intelligence. the democratic leader builds flexibility and responsibility. The examples of leadership styles appearing below contain a brief description of the leader's characteristics. In his writings. Goleman described a total of six different leadership styles. Be careful with this style. the Pacesetting Leadership Style is extremely effective. When used effectively. We've chosen Goleman's model of leadership style because it's both simple and all-encompassing. Much of this information already appears in our article on situational leadership. The coaching leader aids others to get up to speed by working closely with them to make sure they have the knowledge and tools to be successful. They exemplify the behaviors they are seeking from other members of the group. They can help identify new ways to do things with fresh ideas. Democratic Leaders The Democratic Leadership Style gives members of the work group a vote. as well as an example of when the styles are most effective. Coaching Leaders In the Coaching Leadership Style the leader focuses on helping others in their personal development. in nearly every decision the team makes. then you might want to look at that article too because it also speaks to the theory put forth by Ken Blanchard and Paul Hersey. The pacesetting leader sets very high performance standards for themselves and the group. This situational leadership style works best when the employee already understands their weaknesses. and in their job-related activities. or a say. This leadership style needs to be used sparingly since workers can often "burn out" due to the demanding pace of this style. Pacesetting Leaders When employees are self-motivated and highly skilled. Affiliative Leaders The Affiliative Leadership Style is most effective in situations where morale is low or teambuilding is needed.

which have a negative affect on thework environment. If you're going to attempt to learn a different leadership style make sure your approach contains each of these elements. Certainly the ability to switch between styles." Employees can expect much praise from this style. as situations warrant. Mastering Multiple Leadership Styles The formula for a leader's success is really quite simple: The more leadership styles that you are able to master. It is also effective during disasters. then the Authoritative Leadership Style can be very effective in this type of situation. we may need to unlearn old habits. patience."employee first. Authoritative Leaders If your business seems to be drifting aimlessly. unfortunately.often achieved superior performance from their followers as well as a healthy climate in which to work. The authoritative leader is an expert in dealing with the problems or challenges at hand. or dealing with under performing employees usually as a last resort. affiliative and coaching styles . the stronger the link between the situation at hand and the desired reaction. It's not easy to master multiple leadership styles. and even rewards to stay motivated. The more often the new style or behavior is repeated. In fact. feedback. Coercive Leaders The Coercive Leadership Style should be used with caution because it's based on the concept of "command and control. authoritative. Goleman's research revealed that leaders who were able to master four or more leadership styles .especially the democratic. will result in superior results and workplace climate. the better the leader you will become. This leader also allows employees to figure out the best way to achieve those goals. Learning a new skill requires time. You can work with a coach. The coercive leader is most effective in situations where the company or group requires a complete turnaround. . or keep your own notes on how you reacted under certain conditions. In order to master a new way of leading others. Learning a new leadership style therefore takes practice and perseverance. poor performance may also go without correction. This is especially important for leaders that fall back on the pacesetting and coercive leadership styles. and can clearly identify goals that will lead to success. a mentor." which usually causes a decrease in motivation among those interacting with this type of manager.

It is a very collaborative style which focuses on emotional needs over work needs. The Democratic Leader . Done badly. The Affiliative Leader The Affiliative Leader creates people connections and thus harmony within the organization. it has a very strong impact on the climate. They can fail when trying to motivate more experienced experts or peers. holding long conversations that reach beyond the workplace. When done badly. telling them where to go but not how to get there . It is best used when individuals need to build long-term capabilities. It is best used for healing rifts and getting through stressful situations. Any leader can use any style. helping people find strengths and weaknesses and tying these to career aspirations and actions. It has a positive impact on climate.thus motivating them to struggle forwards.Daniel Goleman. Richard Boyatzis and Annie McKee. This style is best when a new direction is needed. These are styles. They openly share information. They are good at delegating challenging assignments. not types. The Visionary Leader The Visionary Leader moves people towards a shared vision. The Coaching Leader The Coaching Leader connects wants to organizational goals. It has a highly positive impact on the climate. Done well. hence giving knowledge power to others. this style looks like micromanaging. in Primal Leadership. it avoids emotionally distressing situations such as negative feedback. it is often used alongside visionary leadership. describe six styles of leading that have different effects on the emotions of the target followers. and a good mix that is customised to the situation is generally the most effective approach. Overall. demonstrating faith that demands justification and which leads to high levels of loyalty.

They identify poor performers and demand more of them. The Pace-setting Leader The Pace-setting Leader builds challenge and exciting goals for people. They get short term results but over the long term this style can lead to exhaustion and decline. The Commanding Leader The Commanding Leader soothes fears and gives clear directions by his or her powerful stance. A good example would be a car manufacturer that operates with very low inventory levels. they will roll up their sleeves and rescue the situation themselves. listening to both the bad and the good news. Done badly. relying on their supply chain to deliver the parts they need to build cars. thereby reducing inventory costs. It is best used for results from a motivated and competent team. They need emotional self-control for success and can seem cold and distant. It often has a very negative effect on climate (because it is often poorly done). it looks like lots of listening but very little effective action. This approach is best in times of crisis when you need unquestioned rapid action and with problem employees who do not respond to other methods. . It is best used to gain buy-in or when simple inputs are needed ( when you are uncertain). expecting people to know what to do. The parts needed to manufacture the cars do not arrive before nor after they are needed. It has a positive impact on climate. A classic problem happens when the 'star techie' gets promoted. When done badly. expecting excellence and often exemplifying it themselves.The Democratic Leader acts to value inputs and commitment via participation. JUST IN TIME An inventory strategy companies employ to increase efficiency and decrease waste by receiving goods only as they are needed in the production process. If necessary. it lacks Emotional Intelligence. This method requires that producers are able to accurately forecast demand. especially self-management. commanding and expecting full compliance (agreement is not needed). They tend to be low on guidance.

This saves warehouse space and costs. and are therefore not a simple solution for a company to adopt. allowing any stock habituates management to stock keeping. lack of flexibility of employees and equipment. Implemented correctly.[2] however some research demonstrates that basing JIT on the presumption of stability is inherently flawed. its effective application cannot be independent of other key components of a lean manufacturing system or it can ". However. The ideas in this way of working come from many different disciplines including statistics. Philosophy of JIT is simple: inventory is waste. and to constantly improve those processes to require less inventory.. Secondly. For instance. . Just-in-time (JIT) is an inventory strategy that strives to improve a business's return on investment by reducing in-process inventory and associated carrying costs.rather do they arrive just as they are needed. production management."[1] In recent years manufacturers have continued to try to hone forecasting methods (such as applying a trailing 13 week average as a better predictor for JIT planning. JIT inventory systems expose hidden causes of inventory keeping. The company must follow an array of new methods to manage the consequences of the change. These problems include backups at work centers. which tell production when to make the next part. process variability. quality. Inventory is seen as incurring costs. This way of working encourages businesses to eliminate inventory that does not compensate for manufacturing process issues. the complete mechanism for making this work is often misunderstood. This does not mean to say JIT is implemented without an awareness that removing inventory exposes pre-existing manufacturing issues. machine reliability. industrial engineering. JIT can improve a manufacturing organization's return on investment. and inadequate capacity.. Just In Time production method is also called the Toyota Production System. To meet JIT objectives. The JIT inventory philosophy defines how inventory is viewed and how it relates to management. Quick notice that stock depletion requires personnel to order new stock is critical to the inventory reduction at the center of JIT. Management may be tempted to keep stock to hide production problems. such as the presence or absence of a part on a shelf. and behavioral science. or waste. Kanban are usually 'tickets' but can be simple visual signals. This inventory supply system represents a shift away from the older "just in case" strategy where producers carried large inventories in case higher demand had to be met. and efficiency.end up with the opposite of the desired result. contrary to traditional accounting. instead of adding and storing value. the process relies on signals or Kanban (看板 Kanban?) between different points in the process.

the need for storage facilities is reduced. Increased emphasis on supplier relationships. The tool used here is SMED (single-minute exchange of dies). at the right place. Cutting setup time allows the company to reduce or eliminate inventory for "changeover" time. The JIT system has broad implications for implementers. JIT Just-in-Time manufacturing `Just-in-time' is a management philosophy and not a technique. quality and quantity.In short. Time—wasted in traffic jams 2. Increased scale has required a move to vans and lorries (trucks). When parts move directly from the truck to the point of assembly. Supplies come in at regular intervals throughout the production day. Cusumano (1994) highlighted the potential and actual problems this causes with regard to gridlock and burning of fossil fuels. at the right time. A company without inventory does not want a supply system problem that creates a part shortage. which simplifies inventory flow and its management. Supply is synchronized with production demand and the optimal amount of inventory is on hand at any time. This violates three JIT waste guidelines: 1. During the birth of JIT. This saves the company money. the just-in-time inventory system focus is having “the right material. multiple daily deliveries were often made by bicycle. It originally referred to the production of goods to meet customer demand exactly. Small or individual piece lot sizes reduce lot delay inventories. Employees with multiple skills are used more efficiently. in time. This makes supplier relationships extremely important. Having employees trained to work on different parts of the process allows companies to move workers where they are needed. Scrap—fuel burned while not physically moving Benefits Main benefits of JIT include:       Reduced setup time. without the safety net of inventory. and in the exact amount”-Ryan Grabosky. it is not made. . Inventory—specifically pipeline (in transport) inventory 3. Production scheduling and work hour consistency synchronized with demand. either by not having to pay workers overtime or by having them focus on other work or participate in training. If there is no demand for a product at the time. whether the `customer' is the final purchaser of the product or another process further along the production line. The flow of goods from warehouse to shelves improves.

each worker is responsible for the quality of their own output. Eliminating waste.workplace cleanliness and organisation.simpler systems may be easier to understand.`foolproof' tools.to smooth the flow of products through the factory. o waste of motion. o Poka-yoke .It has now come to mean producing with minimum waste. JIT is a method of inventory control that brings material into the production process.ensuring machinery and equipment functions perfectly when it is required.to signal problems to initiate corrective action. Total productive maintenance . which reduces the need to store excessive levels of material in the warehouse. Andon (trouble lights) .anything that does not add value to the product. o waste from product defects. Set-up time reduction . flexibility and job satisfaction. There are seven types of waste: o waste from overproduction.providing machines with the autonomous capability to use judgement. just before the material is needed in the manufacturing process. Multi-process handling . i. jigs etc.a multi-skilled workforce has greater productivity.increases flexibility and allows smaller batches.simple tools to `pull' products and components through the process. Good housekeeping . o processing waste. methods. o Quality control at source . Elements of JIT include: • • • • • • • • Continuous improvement. so workers can do more useful things than standing watching them work. o Attacking fundamental problems . Levelled / mixed production . o A product oriented layout . Jidoka (Autonomation) . o Striving for simplicity . o Devising systems to identify problems.produces less time spent moving of materials and parts.e. The technique works when each operation is closely synchronized with the subsequent ones to make that operation possible. easier to manage and less likely to go wrong. o inventory waste. . o transportation waste. Ideal batch size is 1item. prevent mistakes o Preventative maintenance. "Waste" is taken in its most general sense and includes time and resources as well as materials. warehouse or to the customer just in time to be used. o waste of waiting time. and continually improving it. Just in Time or JIT method creates the movement of material into a specific location at the required time. Kanbans .

Director of Career Development Programs at Harvard Business School. because all product is made to meet actual orders – however. so actual orders provide a signal for when a product should be manufactured. in the correct quantity and at the correct time. . becoming obsolete or out of date Avoids the build-up of unsold finished product that can occur with sudden changes in demand Less time is spent on checking and re-working the product of others as the emphasis is on getting the work right first time Disadvantages of JIT • • • There is little room for mistakes as minimal stock is kept for re-working faulty product Production is very reliant on suppliers and if stock is not delivered on time. JIT is a very responsive method of production FOUR DIMENSIONS OF RELATIONAL WORK What Are the Four Dimensions? The four dimensions were identified by Timothy Butler. Information is exchanged with suppliers and customers through EDI (Electronic Data Interchange) to help ensure that every detail is correct.Just in time is a ‘pull’ system of production. and James Waldroop. This means that stock levels of raw materials. This requires a carefully planned scheduling and flow of resources through the production process. components. Advantages of JIT • • • • • Lower stock holding means a reduction in storage space which saves rent and insurance costs As stock is only obtained when it is needed. Demand-pull enables a firm to produce only what is required. Modern manufacturing firms use sophisticated production scheduling software to plan production for each period of time. a car manufacturing plant might receive exactly the right number and type of tyres for one day’s production. and the supplier would be expected to deliver them to the correct loading bay on the production line within a very narrow time slot. less working capital is tied up in stock There is less likelihood of stock perishing. Supplies are delivered right to the production line only when they are needed. For example. which includes ordering the correct stock. work in progress and finished goods can be kept to a minimum. the whole production schedule can be delayed There is no spare finished product available to meet unexpected orders. a founding principal of the consulting firm Peregrine Partners.

4. . Many of us are strong in at least one of these areas – but we may be strong in several areas. have a strength in one area. 3. For instance. Relational creativity. This should also improve the team's performance and productivity. "Understanding 'People' People. or our team members. Both are effective influencers. Interpersonal Facilitation Team members who are strong in this area are often "behind the scenes" workers. Influencers are also good at creating networks: they excel at making strategic friendships and connections. because everyone will be using their natural strengths. or in none of them. if you suspect that someone you're dealing with has a "hidden agenda" during group meetings. What is relevant is that if we. and they love having knowledge and ideas that they can share. Influence People who are strong in this dimension enjoy being able to influence others. then you may need to ask for help from someone on your team who is strong in interpersonal facilitation. 2. Butler and Waldroop argue that a good match will make both the manager and the team happier. They're good at sensing people's emotions and motivations. It's not relevant which area is stronger. A person with strong intuition will likely have some insight into what is motivating this other team member. Or maybe a manager can be relied on to persuade clients to give his team a little more time on a deadline. Perhaps a team member always seems able to "lift" tired colleagues. They're also skilled at helping others cope with emotional issues and conflict." According to their findings. we should try to match their work to that strength. 2. Team leadership. the Four Dimensions of Relational Work are: 1.Butler and Waldroop analyzed the psychological tests of over 7. Influencers don't always have to be in a sales role to use this strength effectively.000 business professionals and published their findings in their 2004 article. Influence. Interpersonal facilitation. They're great at negotiating and persuading. Let's examine each of the Four Dimensions in greater detail: 1.

If she talks about when she influenced a key decision. and they're more interested in the people and processes necessary to reach the goal. but there's an important difference. or motivate others to act. you may decide to pursue a career that uses that strength. Influencing involves person-to-person interaction. Relational Creativity People who are strong in this dimension are masters at using pictures and words to create emotion. Structure your conversation around a specific skill . However. identifying someone's interpersonal skills and strengths takes more effort. Remember that relational creativity is different from influencing. This area also might sound like the influencing dimension. when you ask a job candidate to explain the best moment at her last job. For example. • • Listen carefully . she might be strong in the influence dimension. Use the following tips to help you to assess your current team members. or to ensure that you're hiring the right person for a position. influencers love to impact and shape decisions. build relationships. Assessing the Four Dimensions It's generally easy to evaluate technical skills when you're recruiting or reviewing a team member's work history. But team leaders thrive on working through other people to accomplish goals. if you're strong in interpersonal facilitation. Team Leadership Team members who are strong in team leadership succeed through their interactions with others. while relational creativity occurs from a distance. so also try to find out if she's ever served on a committee or executive board. Tip: You can also apply the Four Dimensions of Relational Work to yourself when thinking about your own career development. Ask the . listen closely. if you need to find a new team member who is strong in interpersonal facilitation.3. 4. Remember. then structure your interview or performance appraisal around that skill. An example is a corporate copywriter who writes such a moving speech that the CEO ia able to inspire the entire company to meet an aggressive deadline.For example. Influencers thrive on the end result and the role they play in closing a deal.For instance.

so use your best judgment. Notice how the person makes you feel .• • candidate to describe how he would resolve a conflict between two other colleagues. one-on-one conversations or during their performance appraisals. (Of course. This is because someone may be strong in this area. Relational work is often ignored or undervalued. Ask when the person experiences "flow" . Rewarding Your Team As well as using the four dimensions to build your team. and assign tasks and projects to the most appropriate people. project. But these interpersonal traits are what make the organization function effectively. then he might excel at team leadership. You could do this in informal. You could even try role playing. If he gets people excited and motivated about their work. even if he has never held a management position. It doesn't have to be a huge change. you can also use the model to reward your team effectively. but has never had a job. Ask your team member or candidate to describe a time when she experiencedflow. Start by educating your team members about their own dimension.It's often easy to identify a person skilled in team leadership. because the more they're rewarded. the more they'll use those skills. she might be strong in relational creativity. and how that person interacts with other members of his team. Key Points . You can also reward team members by giving them work that uses their strength. If her task at that time was creative. this may not be a suitable approach for all teams . don't make decisions based on job titles. Try to connect some type of compensation to their skill. It's important to compensate your team members for these skills. adding tasks or projects that use people's strengths can influence dramatically how satisfied they are with their jobs – and with the organization.) Tip 2: When you look for people to fill each dimension. or mean simply reshaping the role that a person has now. because team members may not currently be in roles or positions that use their strengths. This may require you to create a new role. Pay attention to how you feel when talking to this person. try to structure your teams so that all four dimensions are represented by someone. or about the opportunities that the organization faces. Tip 1: To help ensure balance. and make sure they understand that they'll be rewarded for using their strengths. or task that used this strength.Finding someone skilled at relational creativity can be difficult.

The four dimensions are influence. and team leadership. as well as your own strengths. Matching people's strongest dimensions with the work they do benefits everyone. . relational creativity. interpersonal facilitation. you're all more satisfied and excited about what you're doing – and your organization benefits from improved productivity and engagement. When you and your team are using your strengths.The Four Dimensions of Relational Work can help you understand team members' interpersonal strengths.

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