1.

Shared value (porter& Kramer 2011)

2. The new science of building great teams (Pentland 2012)
3. Is Yours a learning organization? (Garvin, Edmonso, Gino 2008)
4. How successful leaders think (Martin 2007)
5. Exploitation-Exploration tensions and organizational ambidexterity (Lewis 2008)
6. Reflections - A Perspective on Paradox and Its Application to Modern Management (Johnson)
7. "Both/And" Leadership (Smith, Lewis, Tushman 2016)
8. Organizational change and managerial sensemaking (Luscher, Lewis 2008)

1. Shared value (2011)

Shared value = is not social responsibility nor sustainability, but a new way to achieve economic success.
• Re-conceiving the intersection between society and corporate performance
• The aim is to link the societal actions to the core of the corporation rather than having it put as a separate goal of
a firm
• Requires managers to develo new skills and knowledge
◦ Deeper appreciation of social needs
◦ Greater understanding of the true bases of company productivity
◦ Ability to collaborate across profit/nonprofit boundaries
• Narrow capitalism prevents businesses from harnessing full potential to meet society's broader challenges

• In neoclassical thinking, a requirement for societal improvement- such as safety or hiring the disabled imposes a
constraint on the corporation
◦ This will further result in (theoretically) raising costs and reducing profits

• Externalities = arise when firms create social costs that they do not have to bear, such as pollution
◦ For this reason society must impose
‣ Taxes
‣ Regulations
‣ Penalties
◦ So that these externalities will be internalized by firms
◦ For this reason a lot of firms have excluded these social and environmental considerations from their
economic thinking

• Shared value = in contrast, recognizes that societal needs, not just conventional economic needs, define markets
◦ recognizes that social harms or weaknesses create internal costs for firms
‣ Wasted energy
‣ Costly accidents
‣ Waste of raw materials
◦ => addressing these societal harms/ constraints doesn't necessarily raise costs for firms, but can innovate
‣ New methods
‣ Technology
‣ Management approaches
◦ expanding the total pool of economic and social value
‣ Focuses on improving growing techniques and strengthening the local cluster of supporting suppliers
and other institutions to increase
 • farmer's efficiency
• yields
• product quality
• sustainability
• => bigger pie of revenues and profits

◦ "Teach them to fish rather than just provide them fish"

◦ Blurs the boundary between a profit and non-profit organization

‣ There are new hybrid enterprises
‣ Their job is to combine actions to benefit society as a whole, yet generate profits to be able to operate
‣ This is a strong sign that creating shared value is possible

• Redistribution approach = sharing value that is already created by firms

◦ Example:
◦ Fair trade aims to increase the proportion of revenue that goes to poor farmers by paying them higher
prices for the same crops, fair trade is mostly about redistribution rather than expanding the overall amount
of value created

• A business needs a successful community, not only to create demand for its products but also to provide critical
public assets and a supportive environment.

=>

• A business needs a successful community, not only to create demand for its products but also to provide critical
public assets and a supportive environment. A community needs successful businesses to provide jobs and
wealth creation opportunities for its citizens

=> interdependent relationship

Narrow view of capitalism :

• "business contributes to society by making a profit, which supports employment, wages, purchases,
investments, and taxes. Conducting business as usual is sufficient social benefit"
◦ Social or community issues fall outside its proper scope

• In the past the best companies once took on a broad range of roles in meeting the needs of workers,
communities, and supporting businesses.
• Shortening investor time horizons began to narrow thinking about appropriate investments and this furthermore
lead to this change in profit perspective

=> the scope of strategic thinking contracted

Strategy theory = to be successful, a company must create a distinctive value proposi- tion that meets the needs of
a chosen set of customers.
• this way firm gains competitive advantage

How is shared value created?

• by re-conceiving products and markets, redefining productivity in the value chain, and building supportive
 industry clusters at the company’s locations.
◦ improving value in one area gives rise to opportunities in the others.
• The ability to create shared value applies equally to advanced economies and developing countries, more
specific opportunities will differ

Factors that influence company productivity :

◦ Environmental impact
◦ Energy use
◦ Water use
◦ Employee health
◦ Worker safety
◦ Employee skills
◦ Supplier access and viability

• As capitalism begins to work in poorer communities, new opportunities for economic development and social
progress increase exponentially.
◦ By concentrating on providing services to lower-income and disadvantaged consumers, firms are capable
of benefit substantially

• Supply chain affects and is affected by societal issues; natural resources, water use, health and safety, equal
treatment etc.
◦ By smartly developing their supply chain, firm are capable of cut their costs while improving their
operations.
‣ Example: Walmart reduced packaging and rerouting => saved $200 million while increasing their
sales

Resource use

• Has a high impact on waste quantities, firm's improving/optimising their resource utilization has a high impact
on the environment
◦ Landfills fill slower
◦ Less water/electricity consumption
• Example: Coca Cola cut their total water consumption by 9%, goal being 20%, this has enabled them to also
save up to $4 million

Social entrepreneur = pioneering new product concepts that meet social needs using viable business models
• are often well ahead of established corporations in discovering these opportunities
• Can create shared value which can scale up far more rapidly than purely social programs
• "Real social entrepreneurship should be measured by its ability to create shared value, not just social
benefit"

Role of distribution

• Companies are beginning to re- examine distribution practices from a shared value perspective.
• Example: Google scholar provides academic literature online, this resulting in reduction of paper and plastic
usage

Employee productivity

• living wage, safety, wellness, training, and opportunities for advancement for employees have an impact on
productivity
• Example: Johnson & Johnson implemented incentives and programs for employees to stop smoking, this lead to
a $250 million save in health costs (2000-2008)
• If labor unions would concentrate more on shared value too, these impacts could spread more rapidly
Location

• New way of thinking if challenging the idea that firm's locations is indifferent. The old view was to locate
manufacturing to the cheapest country, this mentality is challenged
• Many firm's have realised that supporting more local and close up operations has several up sides
◦ Transportation savings
◦ Restock of smaller quantities
◦ Cutting emissions

Cluster building = are factors that are put into groups based on their nature
• Productivity and innovation are strongly influenced by these clusters
• Clusters can include not only businesses but institutions such as academic programs as well.
• Important factors driving productivity, innovation and competitiveness forward
• the key is to form an open and transparent market, this enables productivity and the other factors to improve

Government regulation = governing, guiding markets and countries, can encourage companies to pursue shared
value
• On the other hand, wrong governing can lead to the opposite
• Can enhance setting goals and stimulate innovation

Creating shared value (CSV) = is integral to a company's profitability and competitive position in the market
• the shared value is tied and part of the businesses profit making, they are not two external factors that just
influence each other
◦ Integral to competing and profit maximization

Corporate social responsibility (CSR) = business programs that focus mostly on reputation and have only a limited
connection the business
• Are usually short-run
• Separate from profit maximization
• Response to external pressure and expectations
• CSR budget

2. The new science of building great teams

Team building is science = Factors that team members have are observable, quantifiable, and measurable
• and team can be taught to strengthen them
• Communication play a critical role in building successful teams
◦ There are also patterns of communication to be the most important predictor fo a team's success
• the best predictors of productivity were a team’s energy and engagement outside formal meetings.

• good leadership and followership, palpable shared commitment, a terrific brainstorming session—that made a
team greater than the sum of its parts.

Sociometric = a measure of how people interact

• tone of voice
• How much they gesture
• How much they talk & listen and interrupt
• Level of extroversion and empathy
• using these metrics researchers have been able to identify communication patterns

Team mapping

Energy = How team members contribute to a team as a whole

• How much team members put effort or contribute to the team function and operations
• How is the work load and input divided between the members
• Showing the map can help managers adjust their behaviour and identify members that are less energetic
individuals and try to engage them more

Engagement = How team members communicate with one another

• How much is there communication between the members in the group, this map helps managers to spot the
members that are more passive or "invisible" and try to engage them into the communication and decision-
making more

Exploration = how teams communicate with one another

• illustrates how much teams communicate with other teams, is there a lot of cross-functional communication or
more team concentrated working
• Often teams that have a high exploration rate have a low engagement because they have less time to engage
with their own team
• High-performing teams seek more outside connection
• Most important for creative teams (innovation)

*exploration and engagement, while both good, don’t easily coexist

Successful team characteristics :

1. Everyone on the team talks and listens in roughly equal measure, keeping contributions short and sweet.
2. Members face one another, and their conversations and gestures are energetic.
3. Members connect directly with one another, not just with the team leader
4. Members carry on back-channel or side conversations within the team.
5. Members periodically break, go exploring out- side the team, and bring information back.

*Individual reasoning and talent contribute far less to team success than one might expect

Communication levels:

1. The most valuable form of communication is face-to-face.

2. Next most valuable is by phone or videoconference
3. The least valuable forms of communication are e-mail and texting.

• “right” number of exchanges in a team is as many as dozens per working hour, but going beyond that decreases
performance

How to apply the data ?

1. Visualization
A. Data itself may be challenging, difficult to interpret and understand, therefore it needs to be visualized by
using formulas to create maps to illustrate the relationship and solutions clearly
B. They will make problem solving easier
2. Training
A. With maps of the data in hand, we can help teams improve performance through visual feedback
B. Visual feedback helps people improve quickly
3. Fine-tuning performance
 A. Through these steps mentioned before implementation to improved performance is possible
B. The maps revealed that the manager needed to keep energy and engagement in balance as he worked to
strengthen them

3. Is Yours a learning organization?

Learning Organization =  An organization in which managers try to maximize the ability of individuals and
groups to think and behave creatively and thus maximize the potential for organizational learning to take place.
• employees in the firm could help help their firms cultivate tolerance, foster open discussion, and think
holistical y and systemical y
• This type of firms ould be able to adapt to the unpredictable more quick y than their competitors could

Building blocks of the learning organization = are factors that are essential for organizational learning and
adaptability
• a supportive learning environment
• concrete learning processes and practices
• leadership behaviour that provides reinforcement
• Firms do NOT perform consistently across these three blocks

1. a supportive learning environment

A. Psychological safety = is a safe feeling as an employee to ask naive questions, disagree with authority
figures or own up to mistakes and present minority viewpoints without feeling fear or discomfort
B. Appreciation of differences = Learning occurs hen people become are of opposing ideas
C. Openness to new ideas = crafting novel (innovative/new) approaches
D. Time for reflection = all w time for a pause in the action and encourage thoughtful revi w of the
organ zatio s processes.
2. Concrete learning processes and practices
A. Having the mechanisms to implement these processes and working methods
B. kn wledge must be shared in ystematic and clear y defined ways
C. Knowledge can move laterally or vertically within a firm
3. leadership behaviour that provides reinforcement
A. Organ zational learning is strong y influenced y the behaviour of leaders.
B. When managers actively listen and question employees, they thereby prompt dialogue and debate, which
furthermore encourages people to learn

Four principles :

1. Leadership alone is insufficient

A. leaders are indeed like y to foster greater learning.
B. learning-oriented leadership behaviours alone are not enough, learning to appear, more explicit and
targeted interventions are needed
2. Organizations are not monolithic
A. a one-s ze-fits-all strate y for building a learning organ zation is unlike y to be successful.
B. Managers need to be especial y sensitive to local cultures of learning, which can va y widely across units
3. Comparative performance is the critical scorecard
 A. The most important scores on critical learning attributes are relativ h our organ zation compares with
competitors or benchmark data.
B. The firms scorecard value does not mean much if it isn't compared to competitors, that is the only way
that value can be put into perspective
4. Learning is multidimensional
A. You can enhance learning in an organ zation in various s, depending on which subcomponent you
emphas ze
B. All aspects of the firm are multidimensional which means that there are several factors that are
interdependent and that they respond to different forces

4. How successful leaders think

Integrative thinking = manager who is able to creative y resolve the tension between two ideas y generating a
new one that contains elements of the others but is superior to both
• keep the entire problem in mind while working on individual segments, and search for creative resolutions
rather than accept trade offs
• A process of consideration and synthesis
• This can be taught and practised, not only born with
• "integrative thinkers do t mind the mess. In fact, th embrace it -- that's where the best answers come from"
• Integrative thinking generates options and new solutions. It creates a sense of limitless possibility

Opposable mind = have the mind and capability to learn new things, teach ourselves new skills and capabilities
• these skill are not exercised enough by humans and therefore great integrative thinkers are rare
• We have the tendency to simplify the world around us and the problems/ issues within

Conventional thinker = are managers who rather than imagining the issue as a whole, prefer breaking it into
smaller segments and solving them step by step. This approach tends to simplify the actual situation and therefore
not create the optimal solutions
• they tend to take the same narrow view of causalit that th do of salience
• They break problem into independent pieces and work on them separately to solve the problem as simple as
possible
• Conventional thinking glosses over potential solutions and fosters the illusion that creative solutions do t actual
exist.

4 stages of decision making :

1. Determine salience (importance)

A. which factors to take into account.
B. In order to reduce our exposure to uncomfortable complexi y, we often filter out important features
when considering an issue.
2. Analysing causality
A. How the important factors are related to the problem and to each other
B. Is the relationship linear or more complex
3. Envisioning the decision architecture
A. There are often other related questions/decisions that are influenced
B. These decisions will also affect the outcome
C. Architecture means the whole picture and the connections of all variables in the solving the problem
4. Achieving resolution
A. Often an unpleasant trade-off is chosen with little complaint since it appears to be the best possible
alternative
B. An integrative thinker would go back to examine things more deeply, generating new options before
 deciding the the final direction
C.

5. Exploitation-Exploration tensions and organizational

ambidexterity
• Innovation = denotes intricate knowledge management processes of identifying and utilizing ideas, tools, and
opportunities to create new or enhanced products or services

• For firms to prosper or even survive, they need to excel at both exploitative and explorative innovation.
• Exploitation = extends current knowledge, seeking greater efficiency and improvements to enable incremental
innovation.
◦ Actions that a firm makes to increase their knowledge on topics and behaviour that is already familiar to
them
◦ Demands efficiency and convergent thinking to harness current capabilities and continuously improve
product offerings
◦ May enable immediate profits, but foster eventual stagnation and leaving the firm vulnerable

• Exploration = entails the development of new knowledge, experimenting to foster the variation and novelty
needed for more radical innovation
◦ Firms that are more innovative and open to search new knowledge and ideas outside the firm and expand
their knowledge and expertise
◦ Entails search, variation and experimentation effort to generate novel recombinations of knowledge

• Organizational ambidexterity = signifies firm's ability to manage these tensions, this kind of firms are capable of
simultaneously, yet contradictory knowledge management processes, exploiting current competencies and
exploring new domains with equal dexterity

• Architectural ambidexterity = proposes dual structures and strategies, differentiating efforts to focus on either
exploitation or exploration innovation

• Contextual ambidexterity = emphasizes behavioural and social means of integrating exploration and exploitation
◦ Prescribed at the executive level and as a more pervasive approach
◦ Higher-order approach
◦ Dual structures and strategies that enabling shared values that aid coordination

• vicious cycle = cycles that stem from increasingly one-sided focus on either exploitation or exploration
◦ Managers only understanding, focusing and approaching only one side of the cycle
◦ Tend toward homogeneity
◦ Developing mindsets and routines supporting one form of innovation, resulting in neglecting other forms
of innovation

• Organizational ambidexterity = managing such innovation tensions arising from actions taken in the firm
◦ Studies encourage top managers to create supportive structures, strategies and contexts to create a
_balanced_ between usage of exploitation AND exploration
 ◦ 3 factors that interact to reinforce and sustain organizational ambidexterity
‣ A multilevel approach
‣ Complementary tactics
‣ Learning synergies

6. Reflections - A Perspective on Paradox and Its Application

to Modern Management (Johnson)
• A polarity map = set of “realities” that we have been developing is one of many incomplete efforts to
describe and access this phenomenon.
◦ It is a visual framework illustrated below, which helps managers to find optimal solutions by
understanding the relationship between the variables in the paradox
◦ It aims to weight the costs and benefits of both variables in it

• Interdependent pairs = are pairs of actions (Inhaling & Exhaling) that have been with us since the beginning of
time
◦ Is illustrated by a pole graph that forms an 8 from one variable to another, from Inhaling to Exhaling
◦ Each pole brings something positive and negative to the pair, it goes from other variables negative to other
ones positive and then again.
◦ Suggested approach would be to focus on building a culture that pursues both upsides of the two variables.
This is more efficient than solely focusing on one variables upside (positive)
‣ This is called dual strategy
‣ Aims to maximize each poles upside and minimize and predict the downside
7. "Both/And" Leadership (Smith, Lewis, Tushman 2016)

"Good leaders are consistent in their decision making, stick to their commitments, and remain on-message"

• Dynamic equilibrium = managers do not focus on being consistent, instead they purposefully and confidently
embrace the paradoxes they confront
◦ Building dynamic equilibrium by separating the imperatives that are in conflict with one another in order
to recognize and respect each one
◦ Simultaneously managing connections between these pairs to benefit from their synergies

Paradoxes of leadership

• Innovation paradox = involve tensions between today and tomorrow, existing offerings and new ones, stability
and change
◦ "Are we managing for today or for tomorrow"

• Globalization paradox = surfaces tensions between global interconnection and local needs
◦ "Do we adhere to boundaries or cross them?"
◦ Boundaries - Geographical, cultural and functional
◦ Should the firm operate in an international market or aim to meet local needs?

• Obligation paradox = being socially responsible can bring down share price, and priorit sing employees can
conflict with short-term shareholder or customer needs.
◦ "Do we focus on creating value for our shareholders and investors or for a broader set of stakeholders?"
◦ Firms struggle with the questions of whether to try to generate wider benefit for society, stakeholders, or to
serve just their investors and own interest

"Paradoxes involve alternatives that are interdependent as well as contradictory"

Example : innovativeness may conflict with operational efficiency, but you ca t be efficient unless you are
innovative at some point - and you wo t be around to be innovative unless you know how to be efficient.

• strategic paradoxes are often a driver of internal conflicts, because paradoxical tensions are often created in
different parts or levels of an organization
◦ Big organizations can have several cultures
◦ People in different business units tend to associate with one side or another of a paradox, which causes
conflicts

• Traditional leadership = Leaders that do not embrace paradoxes but approach complex problems by splitting
them into smaller/simpler parts see resources (time, money, people..) often as scarce
◦ Comes from the mentality that as a lower manager resources are generally speaking controlled by higher
authority and therefore seems like all resources are always scarce
◦ Minimizing complexity and emphasizing stability
◦
• Paradoxical leadership = leaders who use paradoxical thinking and problem solving
◦ often realise that resources can be abundant and often generative
‣ Using alternative technology
‣ New partners
‣ Shifting resources for better use
◦ Embracing dynamism and change, helps to reach dynamic equilibrium in the firm
◦ Requires both separating and connecting opposing forces
◦

8. Organizational change and managerial sensemaking

(Luscher, Lewis 2008)

• Organizational change is essential for short-term competitiveness and long-term survival, yet poses managerial
challenges

• The ever-changing market arises expectations for firms to constantly improve and change, to cut costs while
enhancing flexibility
◦ High executives design these projects, yet leave the implementation of these changes to middle managers
◦ Middle managers "have the challenge of grasping a change they did not design and negotiating the details
with others equally removed from the strategic decision making”

• Sensemaking = an effort to create orderly and coherent understandings that enable change

• Single-loop = signifies incremental variations within an existing frame

• Double-loop = denotes reframing, substantially altering an actor's view and thus enabling dramatic changes in
understanding and action

• In the case of change in the firm :

◦ Firms become more geographically dispersed and leaner
◦ Top managers have less contact with lower levels, expecting middle managers to do the job
◦ Managers having fewer interactions with executives
◦ Employees look to their manages to give sence to change mandates
◦ Managers struggle for understanding

• Action research = seeks to bring together action and reflection, theory and practice, in participation with others,
in the pursuit of practical solutions to issues of pressing concern to people
◦ Purpose is to "produce practical knowledge that is useful to people in the everyday conduct of their lives"
◦ Today tends to be
‣ Instrumental
• Improving organizational systems
‣ Theoretical
• Contributing to social science
‣ Emancipatory
• Empowering the oppressed
◦ Some action researches follow and rely on a systematic intervention, yet others are more flexible and
 without a predetermined process

• working through paradox =helping managers make sense of tenuous demands to reduce anxiety, escape
paralysis and enable action
◦ Steps go through from defining the specific problem, to trying to find approaches to find an optimal
solution

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