Does the Decalogue Methodology Improve Management Effectiveness?

Back in September, Angela Montgomery published a book entitled The Human Constraint: How Business Leaders Can Embed Continuous Innovation, Conflict Resolution, and Problem Solving Into Daily Practice, which explores an increasingly complex, interdependent, and fast-changing world where companies must have a way to overcome obsolete mental models and embed continuous innovation in their operations with a coherent organizational model.

When I spoke with Angela recently, I asked her: “How does the Decalogue methodology improve management effectiveness?” Here is her complete response: 

Whether it’s a startup, a scaleup, SME or multinational, smoke stack or hi-tech, leaders, founders, managers, and investors face challenges today unlike before. Applying linear thinking and conventional management tools is no longer adequate or effective. Our new reality is a complex, highly nonlinear network of cause-effect relationships. Moreover, the digital age requires better decision-making, faster innovation, and flawless delivery of products and services. What’s needed is a new way of thinking and operating. 

The Decalogue method introduces leaders to a systemic approach to managing operations. It helps them connect dots they would not otherwise see and strategize, plan, and execute at a whole new level. Learning to behave as one cohesive system involves identifying a unique leverage point (constraint) to propel performance and achieve significant and sustainable growth. The method enables a company to develop a systemic value proposition for the market that competitors cannot imitate while improving performance company-wide to deliver their offer reliably. 

The Ten Steps of the Decalogue enhance all aspects of business, from production to marketing and sales, project management, new product development, supply chain, finance, and M&A. The steps give business owners and leaders a clear and focussed path to achieving maximum value with the resources available. A leap in overall performance is achieved by defining a clear goal and measurements, understanding variation to map effective processes and interdependencies, and identifying the one factor that determines the pace of throughput. 

A key part of the journey is embracing and implementing necessary change. Our human ambitions and emotions all have a role to play, and this is what I hope to emphasize in the book. The Decalogue introduces a set of systemic Thinking Processes that enable companies to overcome cognitive barriers to change and channel their energies in a positive direction towards a common goal. These processes embed into daily practice the ability to solve problems, resolve conflicts, and continuously develop breakthrough solutions that add high value. 

What do you think of Angela Montgomery's perspective? Do you have experience with the Decalogue method? Do you think it would be effective in your organization? 

Bioinspired Strategies -- Do They Help Companies Survive?

During this past July, Daniel J. Finkenstadt and Tojin T. Eapen published a book entitled Bioinspired Strategic Design: Nature-Inspired Principles for Dynamic Business Environments, which shows that the same three capabilities essential for the survival of living organisms in harsh environments – efficiency, resilience, and prominence – are also critical for organizations in their process of navigating through their own hostile environments.

I spoke with both authors shortly after the book's publication, and during our conversation, I asked them: "What are bioinspired strategies and how do they help companies survive?" Here is their complete answer:

The bioinspired strategies described in the book draw inspiration from adaptations and mechanisms found in living organisms to solve complex problems. These strategies can be analogically applied to identify survival strategies applicable to human organizations, including companies.

This approach of analogically associating nature with business problems also encourages viewing business operations and challenges as part of an interconnected system.

Bioinspired strategies help companies survive by improving their efficiency, resilience, and prominence (we call it "ERP" capabilities) in challenging environments.

The key lesson in the book can be described as follows:

"The effect of any action on survivability cannot be understood by merely looking at its impact on one of the three ERP factors, efficiency, resilience or prominence that it seeks to modify, but requires looking at indirect effects mediated by the other two factors."

This means that a company’s actions don't exist in isolation – they can have ripple effects across all three factors, which together determine the company's overall ability to survive and thrive.

Firstly, companies can optimize their efficiency (E) by studying how organisms efficiently manage limited resources through principles such as resting, reduction, and reuse.

For example, consider how certain desert plants, like cacti, have adapted to conserve water in arid environments. They have developed specialized structures to store water and minimize water loss through transpiration. This natural strategy can inspire businesses to find innovative ways to conserve and efficiently use their critical resources, especially in resource-scarce operating environments.

Secondly, nature's lessons in adaptation to external forces guide business on resilience (R). Specific principles found in nature such as replacement, repair, and reinforcement can help businesses become more adaptable to market changes and crises.

For example, consider the well-known case of how camels store fat in their humps for long journeys. The camel's hump illustrates the role of reservoirs and reinforcements in survival when faced with extreme unpredictable forces. This principle is also found in business environments, such as building up buffer stocks or cash reserves to manage uncertainty.

Thirdly, the concept of prominence (P), inspired by how organisms balance their visibility towards predators, prey, and mates, can be applied to managing complex relationships that involve both attracting and avoiding attention from observers.

In nature, prominence capability is apparent in the ability of various cephalopod (squid, cuttlefish, octopi) species to alter their appearance in the presence of different observers (predators, prey, or potential mates).

In the book, we show how cephalopods' strategies for managing visibility can be applied to startups dealing with various stakeholders like investors, competitors, and customers.

Nature-inspired strategies offer design principles such as combination, removal, and segmentation. These serve as practical guidelines for generating ideas and managing trade-offs in strategic decision-making. By looking to nature for inspiration, businesses can discover innovative solutions to complex challenges and enhance their chances of long-term survival and success.

What do you think of Daniel and Tojin's ideas? Has your company implemented any methods that use nature as inspiration to solve problems?

The Future of Manufacturing -- What are the New Core Technologies?

This month, Philip J. Gisi published his third book with Productivity Press entitled The Dark Factory and the Future of Manufacturing: A Guide to Operational Efficiency and Competitiveness. His new book provides a view into the future and direction on how to navigate the journey to a more automated, smarter, and continuously learning factory. This book consolidates the major elements of the fourth industrial revolution and describes them in clear terms within the context of integrated manufacturing. It creates awareness and a fundamental understanding of the advanced technologies that are coming together to facilitate highly automated, smarter, agile, and sustainable operations.

When I spoke with Phil this past week, I asked him: "What are some of the newer core technologies in manufacturing and how are they being used?” Here is his complete answer:

Manufacturing is undergoing a significant transformation with the adoption of several newer core technologies such as the Industrial Internet of Things (IIoT), Artificial Intelligence (AI), Augmented Reality (AR) / Virtual Reality (VR), and Digital Twins. IIoT involves connecting machinery, sensors, and other devices to collect and exchange data. This data can be used for real-time monitoring, predictive maintenance, and improving overall efficiency.  AI is being used in manufacturing for process optimization, quality control, predictive maintenance, and even autonomous decision-making. Machine learning algorithms can analyze vast amounts of data to identify patterns and make predictions to avoid unplanned equipment downtime.  

AR and VR technologies are being used in manufacturing for training, design visualization, and maintenance. These technologies can help improve efficiency, reduce errors, and enhance collaboration while the application of a digital twin, serving as a virtual model of a physical manufacturing asset, process, or system, can enable real-time monitoring, simulation, and optimization, leading to improved performance and reduced downtime. As I stated in my latest book, “Manufacturers must be aware of, understand, and embrace these changes to stay competitive and meet the evolving demands of customers in the modern era. This book enhances the awareness and understanding of these core technologies by explaining what they are and how they are being used in manufacturing."  Clearly, these technologies are reshaping the future of manufacturing and will continue to do so as they evolve within the scope of the Fourth Industrial Revolution or Industry 4.0 for short.

What do you think of Philip's perspective? Are these core technologies now part of your business? If so, have they delivered the expected results?

How Can Senior Leaders Be Effective in Times of Constant and Dramatic Change?

At the beginning of January, I spoke with author Joanne Irving about her latest book entitled The C² Factor for Leadership: How the Alchemy of Curiosity and Courage Helps Leaders Become Champions and Lead Meaningful Lives. This book answers the questions: How do we effectively lead in times of constant, often dramatic change? And, equally important, how do we simultaneously create a satisfying, meaningful life? In addition, it reveals that when leaders manifest both traits, they embrace the professional and personal opportunities the future brings. When the landscape is shifting beneath our feet the C² Factor enables us to lead more effectively and helps us cultivate more fulfilling personal lives.

During our conversation, I asked Joanne: "How can senior leaders be effective in times of constant, often dramatic change?" Here is her complete answer:

How can we prepare for the future when COVID and all the changes it provoked remind us of just how surprised we are when it arrives?

Cognitive skills such as business competence, creating a vision, and strategic thinking; and emotional intelligence such as communicating, inspiring, and developing others are necessary but insufficient for leadership today. Beyond specific skills, beyond IQ and EQ, leaders today need personality characteristics that enable them to respond to changes regardless of what conditions emerge. To embrace and exploit the future, leaders need to develop and exercise the C² Factor -- the application of profound curiosity and relentless courage

While both curiosity and courage are often mentioned on lists of desired leadership qualities, the alchemy of the two -- the C² Factor -- is where the magic is. 

Curiosity and courage are symbiotic and when applied synergistically, produce exceptional leadership. To be curious often requires courage – the courage to examine one’s assumptions, beliefs, and attitudes, the courage to be curious about what options have not been considered, whose opinion has been left out, why the organization is structured the way it is…

And it helps us be courageous when we adopt a curious mindset. When faced with a challenge, instead of reacting with defensiveness we can explore the validity of that challenge, be interested in what opportunities it could bring, and what innovation it might inspire. Courage is what enables us to take action in the face of ambiguity.

Leaders who want their organizations to nimbly navigate the lightning-speed change of today and be prepared for an assuredly uncertain future must model the C² Factor and embed it in their organization’s culture. This means:

● Hiring from groups with diverse backgrounds

● Enabling innovation by encouraging challenges to the status quo

● Providing time and resources for exploration outside of one’s immediate area of expertise

● Rewarding judicious risk-taking, even when those experiments fail

Today’s world is different from what tomorrow will bring so business as usual does not work. Leaders must ask questions and make decisions that challenge or even defy conventional wisdom.  They must take action to respond to conditions they have never anticipated. They must exercise their C² Factor.

What do you think about Joanne's ideas? Do you believe that this synergistic application of curiosity and courage results in more effective leadership? 

The Six Fears that Impede Corporate Innovation

New business innovation isn’t working in most large corporations. This is true even though we have made great progress over the past two decades in understanding the mechanics and dynamics of radical innovation. We have got the methodologies for creating the businesses right, but our organizations still seem to snatch defeat from the jaws of victory.

Why is this? New business creation is thriving in the startup sector, often disrupting incumbents, so the problem is not a lack of opportunity. What is going on? 

I recently spoke with James Euchner, whose recently published book -- Lean Startup in Large Organizations: Overcoming Resistance to Innovation -- addresses such questions. During our conversation, I asked him about the sources of resistance and their connection to Lean Startup. Here is his complete answer:

Any new venture confronts uncertainty: uncertainty in customer demand, uncertainty in the timing of the market, uncertainty about new channels or new business models or emerging technologies. Corporations have gotten better and better at managing these types of risk. The Lean Startup movement has done much to help with this.

It is ironic, but the very methods that have led to success in creating product/market fit have interfered with venture/corporate fit. There are, in fact, six fears that Lean Startup awakens inside the corporation that impede innovation.

The first is the fear of chaos: the concern that the iterative and experimental approaches of the Lean Startup will lead to an unmanaged innovation process. An Innovation Stage-Gate helps to contain the chaos. 

The second is the fear that the innovation process will lead to disruption of ongoing operations. Every corporation has established norms that define “how we do things around here.” New business innovation naturally challenges some of these norms. This disruption needs to be acknowledged and explicitly managed for a new venture to succeed.

The third fear is the fear that the lean innovation process will lead the company into opportunities that the company just can’t exploit. Worse, the new directions may even undermine the identity of the firm. A company needs to innovate within clearly defined opportunity spaces to counter this fear.

The fourth fear is that the new business will succeed by cannibalizing the core: the new business will appear to drive revenue and profit, but only at the expense of the financials of the ongoing business. To counter this fear, companies need to explicitly model not only the economics of the business but the impact of the new company on the core business. Sometimes, cannibalization is necessary to the ultimate growth of the firm.

I believe that the fifth fear is the cause of the failure of more new ventures in corporate settings than any other. This is the fear that the investment in the new business will drain resources from the core. It causes the core business to react in ways that smother the new business. Countering this fear often requires separating the new company from the mother ship, at least during incubation. 

Finally, executives often fear making a career-limiting blunder when investing in a new venture. After all, the new venture, by definition, moves into spaces that are less well-understood by executives in the company. To counter this fear, companies need to develop ambidextrous leaders – those who can both execute and innovate. A key requirement is for the executives to spend time in the new ecosystems. 

What has your experience been with new business innovation? What are your thoughts on Jim Euchner’s suggestions for inoculating companies against these corporate antibodies? 

Reusable Visual Models -- Are Your Product Development Teams Using Them?

In September, Penny Cloft, Michael Kennedy, and Brian Kennedy published a book entitled Success Is Assured: Satisfy Your Customers On Time and On Budget by Optimizing Decisions Collaboratively Using Reusable Visual Models. This book teaches new thinking and methodologies to convert the chaotic front end of product development into a convergent process of set-based learning and continuous innovation – a game changer for companies that depend upon a steady flow of innovative products.

I recently spoke with Brian Kennedy about the book and asked him: “What are reusable visual models and why do they make a difference?” Here is his complete answer:

Each of those three words “reusable visual models" pack a fair bit of meaning. As “models," they are representing knowledge about the real world. They are capturing what we know how to do, what we know is possible, what physics allows. In addition, they are capturing what we are trying to achieve or what value we are trying to deliver. And then they are capturing the cause-and-effect relationships between what we know and what we want.

In complex situations where we must engage people with expertise in different areas to make decisions, having models is helpful, but only if all the stakeholders can understand those models. That’s where the “visual” comes in. We need those models to be visually understandable to people without needing to know specialized notations or languages that are only understood by people in certain fields. It is not good enough to just explain what you put in your model… you need those experts in different areas to really understand the model such that they can critique it and find the holes in it or the bad assumptions in it based on their own area of expertise. Finally, to maximize the benefits of such models, it is obviously best if they are “reusable” in similar situations in the future. For many that means capturing them in a known place that can be searched. Most companies, however, have “lessons learned," “best practices," and other such databases… but they experience very little actual “reuse.”

The first key requirement for “reusability” is that it was useful in the first place -- that your team of collaborating experts was able to use it to make the decisions they needed to make. If the knowledge you capture does not change the decisions you make in the future, then it has no value. So, when you make similar decisions in the future, you should be able to use those models to better make those decisions. That’s where the “set-based” aspect of those models becomes important: the models must be designed to capture the design space not a particular design (a particular point in that design space). It is hard to reuse a design to make the right decisions on a different design trying to satisfy different requirements. But knowledge about the design space -- knowledge about how what you know impacts what you want to achieve that is easily reused when making different decisions about different designs trying to satisfy different requirements -- is what we mean by “reusable." And just to stress that point, note that building “reusable" visual models is not just of value to future projects… it is hugely valuable on THIS project. Because invariably we will learn things over the course of the project -- and requirements and conditions may change -- and thus the decisions may need to change or be re-made. When you re-make those decisions, you want to make them considering all the knowledge you used before PLUS the new knowledge (the changes). That is done most effectively and efficiently with “reusable visual models.”

What do you think of Brian's explanation of these models and how they should be used? Are reusable visual models part of your product development team's process? More information about this technique and the book can be found here: SuccessIsAssured.com

When 45 Business Gurus Share Their Most Important Insights

Last month, a very interesting book entitled The GuruBook: Insights from 45 Pioneering Entrepreneurs and Leaders on Business Strategy and Innovation, compiled by Jonathan Løw, was published. In it, 45 of the world’s leading entrepreneurs and leaders -- such as Salim Ismail (Singularity University), Naveen Jain (Moon Express), Jimmy Maymann (Huffington Post), Otto Scharmer (Theory U), and Blake Mycoskie (TOMS) -- plainly discuss their ideas about innovation, entrepreneurship, and authentic leadership.


I had the chance to speak with Jonathan Løw about this book, and one of the main questions I asked was: "What inspired you to compile the thoughts of these particular entrepreneurs, innovators, and leaders?" Here is his complete response:  

The GuruBook is first and foremost about listening. Although I have been a serial entrepreneur and have tried to start a number of businesses, have worked with innovation in both large and small organizations, and have been a leader in several organizations, I do not imagine in any way that I have all the answers in these exciting but also complex areas.

I believe that the ability to listen is one of the most important characteristics for future entrepreneurs, innovators, and leaders. This ability to listen, and the curiosity that is inherent in it, may be the factor that gives you an advantage over the competition. Consider, for example, the English mathematician and physicist Isaac Newton, who, like millions of others, saw an apple fall from a tree. The difference was that Newton asked "why."

As a result of my own curiosity and desire to listen more, it was obvious that I should invite the people who, in my eyes, have generated inspiring and pioneering ideas, organizations, and results, to share their thoughts and knowledge with the readers in The GuruBook.

This book’s gurus have been asked to talk/write about what they’re enthusiastic about. That means that you can look forward to becoming more knowledgeable about:

• How to start a business without an idea.

• Why some ideas succeed while others fail.

• How to demystify the task of scaling up a startup as an entrepreneur.

• How you can be enterprising, no matter what phase your organization is in.

• How to create an innovative culture.

• Why simple questions lead to the greatest innovations.

Why businesses and local authorities aren't startups, and what both can learn from each other.

• How to become authentic as a leader.

• Why authentic leadership is a strength.

• Why there’s an entrepreneur in every successful leader.

• Why the ability to listen is all-important whether you’re an entrepreneur or a leader.

The contents of The GuruBook have weight and value because the articles and/or interviews are with people who, for years, have perfected their ability to listen and have consistently become better at understanding their customers, partners, and colleagues.

Through thousands of meetings, sales calls, customer service responses, innovation processes, brainstorms, mail dialogues, LinkedIn discussions, and so on, they have listened and then acted on what they heard. These are the insights that The GuruBook contains.

I fundamentally believe the future belongs to the curious. The future belongs to the entrepreneurs, innovators, leaders, and passionate souls who are not only capable of “listening more intently” to the world about them, but who are capable of “ listening more intently” to the world about them but who also have the ability to act on the input they get.

A website for the book -- https://www.thegurubook.org/ -- includes a list of the gurus participating as well as some more background on the book.

Social Responsibility and Shared Value = Higher Profits

This past month, John C. Camillus, Bopaya Bidanda, and N. Chandra Mohan published a book titled The Business of Humanity: Strategic Management in the Era of Globalization, Innovation, and Shared Value, which explains why many organizations are pursuing a novel, forward-thinking business model. These companies are building "humanity" into their models as the driver of economic, environmental, and social sustainability.

During a recent email conversation with the authors this month, I asked them: “Can companies built on shared value sustain for the long term?” Here is their collective response:

That is a fundamental question that goes to the heart of the Business of Humanity® Proposition. Our answer is an emphatic "Yes!"

Iconic figures such as Nobel Peace Prize-winner Muhammad Yunus contribute to keeping this question alive by proposing “social business” as a model, de-emphasizing profits and focusing primarily on addressing social concerns. This mindset, though most commendable, raises justifiable questions about sustainability.

We see shared value as a requirement for the survival of business. For instance, the importance of sharing value with communities is becoming apparent and activist non-governmental organizations (NGOs) make it an imperative. Remember that Tata Motors had to abandon a $300 million investment in an assembly plant because the local community felt that it had been exploited when land was acquired for the plant.

We go even further by arguing that sharing value strategically with the organization’s stakeholders enhances profitability. The disruptive innovations that are part of the Business of Humanity’s profit-enhancing business model will create damaging conflicts between stakeholders if they are not purposefully engaged in the process of value creation and understand that they will be earning a slice of a substantially larger pie.

We are definitely not being Pollyannaish. When Paul Polman, the chairman of Unilever, was asked how his company could continue to make profits with its emphasis on social and environmental sustainability, his response was that he did not see how profits could be sustained without such an emphasis. The Business of Humanity strategy development process is designed to ensure that shared value promotes profitability and, consequently, sustainability.

Do you think there is validity to the argument that a more human-centered capitalism is vital as a long-term business strategy and the correct method for sustainable economic behavior?  

How Can We Overcome Toxic Conformity at Work?

Why are many of our organizations almost allergenic in their responses to innovation? Why do we penalize those courageous individuals who challenge the status quo by swimming against the tide? What can we do at work to ensure that dissenting voices speak up and make us reflect on where we are going and what we are really trying to achieve? 

 I recently put these questions to Bill Templeman, author of the just-published book, Leadership Basics for Frontline Managers: Tips for Raising Your Level of Effectiveness and Communication. I wanted to know why this dynamic happens and what managers or anyone in a leadership position can do about it. Here is his complete response:  

All organizations with any sort of hierarchy are prone to believing in their visions and plans for the future; the stronger the culture, the greater the belief that “We are on the right path!” It is no secret that business plans become documents of faith, just like party platforms become documents of faith for politicians. The CEO of a major hi-tech firm recently said that he measured his executives’ teamwork skills by assessing their degree of commitment to the corporate business plan. But what if this plan is flawed? 

Admiral John Godfrey, the former Director of Britain’s Naval Intelligence Division, in analyzing "Operation Mincemeat," a highly successful World War II espionage operation, identified two major weaknesses of the Nazi’s command structure: "wishfulness" and "yesmanship."

Wishfulness is that tendency among individuals and organizations to believe information that supports their own view of reality while simultaneously to reject all contradictory information. Yesmanship is the tendency of those with less positional power to agree with those who have greater power, mainly out of fear. Yesmanship is an enabling behavior for wishfulness. 

What can we do to ensure that wishfulness and yesmanship do not distort our business planning and decision- making? How can we encourage people to speak their truth?

• Be the change you want to see in your people. If you want the truth, you must speak the truth and be the truth. 
• Encourage debate and dialogue. Welcome ideas that conflict with your own assumptions. 
• Hire people who are likely to disagree with you on business issues. 
• Instead of arguing with dissenters, ask for explanations of their thinking. 
• Treat everyone according to a set of worthwhile values.
• Build a culture of trust by demonstrating trust.
• Show your commitment by demonstrating everything you believe in through your own behavior.
• Cherish your dissenters and critiques. 

How far would Bill’s ideas go in your organization in terms of encouraging new thinking that goes against the current? Are there other ways you could discourage the toxicity of conformity at work?

Innovation and Lean Development

In a recent e-mail discussion with Timothy Schipper and Mark Swets (authors of Innovative Lean Development: How to Create, Implement and Maintain a Learning Culture Using Fast Learning Cycles), I asked them both to succinctly explain to me why innovation and lean development are important skills for an organization to develop and foster. They replied jointly, and I am posting the response here as many readers will find it quite interesting:

"What you need to know about the problem or solution to an opportunity may only become apparent as you try to solve it. The key to design is the effective management of the dual exploration of both the problem space and the solution space. Rapid learning cycles bring both effectiveness and efficiency to any product or service innovation challenge. A design team faces two difficulties: the first is to understand the problem, and the second is to find a solution. There is no logical, straight line to success. The team or individual must work back and forth between solution and problem, between innovative ideas and the requirement definitions. Multiple learning cycles provide the way out of this messy problem. The problem and the solution co-evolve in the same design process."

What are your thoughts on this response?