Friday Dec 19, 2025
Friday Dec 19, 2025
Friday, 13 December 2013 04:28 - - {{hitsCtrl.values.hits}}
After Prof. Liyanage’s introduction, Prof. Birkinshaw took the centre stage for his presentation, focusing on the bigger picture of challenges and opportunities large and small organisations face.
Following are excerpts of the presentation, which was attended by the Daily FT’s Sarah Hannan:
I’m going to start with a little teaser; a question for you to get you thinking. This data is collected annually in America, in the UK and in Australia. People list how they view professions and you can probably guess where I’m heading with this. It is not a pretty picture. The business executives are still ahead of the car salesman. They are behind the lawyers, the bankers, the journalists and so forth. There are lots of reasons for this and this is recent data and I update this slide annually. The stats are now about 12 months old but I’m pretty sure the story is quite consistent.
There is a big problem in the world’s perception, the public perception is that the world is a big business and there’s lots of reasons for that. One of them is that as we look across industries we see biggest average companies in a wide variety of industries. You recognise there are many others we could also put on the list where companies are not performing as consistently as they were, big companies like BP in the UK, all the banks, you know the list, have had major crises and as a result I think when companies get into trouble, the public starts to kind of feel that somehow the whole cadre of business executives are not quite as ethical and upstanding and with perhaps less integrity then they should have and I think that’s wrong but the point is if the public believes that, there is an issue because we as people who are influential in the business world have to restore legitimacy to the public to be able to continue to have influence.
If you don’t believe me that the world is getting more difficult and more challenging, here’s just one piece of updates the way we’ve kind of correlated performance in one year of the top 500 companies and we collated that with performance for four and then seven years. When you look at the chart you will notice that the future earnings are becoming much less predictable than the current earnings compared to the predictions done during the ’70s. The correlation between past and future performance is going down quite steeply. What that says is there’s a greater turnover of the companies at the top of the pile and by definition what that means is that previously successful companies are losing out more often than they used to.
New technology is rolling out increasingly quickly and the evolution of telephone technology is a good example. You can see the speed with which rolled out and grew – you’ve got the computer and you’ve got the mobile phone because nowadays adversaries, you people with mobile phones, is actually more than 100% suspect. With these devices we’ve got a very rapidly increasing rollout of technologies.
I don’t remember this guy, he was all the rage last year. He’s now kind of disappeared again, but it took six months for this guy to show a sign; his name was Psy. To go from being a completely unheard of guy outside of Korea to having one billion views on YouTube and of course we know exactly what’s going on here, the viral nature of all the above information. A dissemination allows these guys to become world famous from a standing start in less than a year.
Technology is driving changes in the business world So there’s a lot of stuff happening and I guess we all experience it in its different shapes and forms. What’s my kind of contribution to this? It is to say that firms need to find better ways of responding to this world and accelerating change. It was mentioned that I founded with Gary Hamel the MLab – the management innovation lab. The policy and the papers about Mlab were very simple, we said to ourselves; we as academics shouldn’t be just viewing companies from a fall. We should actually be working with companies to help them to become better at managing. This was six or seven years ago that when we talk about innovation we often obsess about technology innovation. We often obsess about the latest on iPad or iPod or whatever it is, as a product innovation as the stuff that we can physically hold on to. But if you think about it for more than a few seconds, you realise the innovation as a concept applies to any aspect of the things that we do. The products we sell and the ways that we work. Management Innovation Lab was all about enlarging our view of innovation, so the innovation becomes an investigation into how we can work more effectively, rather than just in terms of the products or services that we make.
Let us look at the obstacles we face:
education obviously important, bullet trains and number six didn’t quite make the top five was to give the Church of Scientology tax-exempt status.
Obliquity
Goals are best achieved indirectly and here is a quote from Victor Frankel, famous Holocaust survivor and founder of a branch of psychotherapy: “Don’t aim at success. The more you aim at it and make it a target, the more you are going to miss it. For success, like happiness, cannot be pursued; it must ensue, and it only does so as the unintended side effect of one’s personal dedication to a cause greater than oneself or as the by-product of one’s surrender to a person other than oneself. Happiness must happen, and the same holds for success: you have to let it happen by not caring about it. I want you to listen to what your conscience commands you to do and go on to carry it out to the best of your knowledge. Then you will live to see that in the long-run — in the long-run, I say! — success will follow you precisely because you had forgotten to think about it.”
Let’s look at the corporate goals of TATA: “We are committed to improving the quality of life of the communities we serve. We do this by striving for leadership and global competitiveness in the business sectors in which we operate. Our practice of returning to society what we earn evokes trust among consumers, employees, shareholders and the community. We are committed to protecting this heritage of leadership with trust through the manner in which we conduct our business.”
Looking at profitability and performance in a period of time helps individuals to identify with a higher order purpose and to adopt a new set of management crowd source ideas.
Alternative principles
Progress in the men’s high jump world record between 1900 and 2000 – This is the men’s high jump world record. Some of you will know this story but I’m going to give it a little twist. This is the heights that men have jumped over a 100-year period. 1.59 five meters at the time the previous century up to the current record which is somewhere around 2.5 to 2.55 meters. What do you think is happening there?
The first pre-flop led to this dramatic growth in the world record when it turns out it wasn’t. This is why it’s an interesting story. It turns out that this split in high jump sort of greatness came about because two guys, John Thomas, an American and Valeriy Nikolayevich Brumel, a Russian, work on arch-rivals and as you can see from this chart that both use the old technology, the old method.
Just before the Mexico Olympics Valeriy Nikolayevich Brumel had a motorcycle accident and could no longer jump. So along came the Mexico Olympics and this chap Richard Douglas Dick Fosbury suddenly became a world-famous name. He won the Gold at the Mexico Olympics but and this is where the story gets very interesting! You look at his performance, he was jumping 50 centimetres lower than Valeriy Nikolayevich Brumel. He was a no hope, he was a joke, people were laughing at him for this crazy method of jumping over the back but he stuck with it. He continued to push it and reinforce it and eventually at the Olympics Fosbury with his flop won the gold medal and of course he didn’t beat the world record. He was a good three or four centimetres lower than the record. At that point people started to take him seriously. The full pre-flop is fascinating because for many years it just wasn’t as good as the strategy but eventually became a style.
To become a future-ready organisation strategy of management methods need to be reinvented, competent trustworthy individuals who can take responsibility need to be recruited as sense of purpose, space, resources can nurture emerging behaviour. Be the ones who try something different and rise above their competitors.
