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Haste – A major cause for business crises and conflicts

September 20, 2007

Juhani AnttilaAcademician, International Academy for QualityVenture Knowledgist Quality Integrationhttp://www.QualityIntegration.biz , http://qiblog.blogspot.com juhani.anttila@telecon.fi

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Haste – A major cause for business crises and conflicts

Contents:

1. Crises, conflicts and haste as phenomena in business environments2. Observations from work researches3. Human conflicts4. Business crisis management5. Learning from accomplished personalities6. Asking “Whys”7. Approaching strengthened performance

xxxx/2.9.2007/jan

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Transition in crisis (*)

(*) Ref.: Adams & al3171/2.9.2007/jan

1. IMMOBILISATIONShock - Mismatch betweenexpectations and reality

2. DENIALDefensiveness - Retreatinto false competence.Denial of needto change

3. INCOMPETENCEAnger, frustration and confusion - Awareness that change is necessary but unsure what to do.

4. ACCEPTANCE OF REALITYSadness - Letting go to pastattitudes and behavior.Excitement - At prospect ofimproved performance

5. TESTINGTrying new approaches and coping with risk of failure (trepidation)

6. SEARCH FOR MEANINGCuriosity - Trying to understand how and why new behaviors are better.

7. INTEGRATIONConfidence - New attitudesand behavior becamepart of behavioralrepertoire

Perceivedcompetence

Beginning a transition Time

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Orienting to business crisis

Crisis is a stage in a sequence of events at which the trend of future events - especially for better or for worse - is determined

– Typically crisis relates to • A condition of instability or danger, as in social,

economic, or political affairs • An unique situation that has reached an extremely

difficult or dangerous culminating point• A time of great disagreement, uncertainty, suspense or

suffering

Crisis is a turning point leading to a decisive change.

The word crisis originates from Greek krísis meaning decision. One type of decision is also if one leaves undone a decision.

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Dr. J. Juran, USA: “There is no real development in oganizations without business crises.”

Crises and conflicts are always in human minds not in organizations.Often due to haste or conflicts business situation develops to worse.

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Changing business environments are conductive to increasing business crises and conflicts.

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Uncertainty and ambiguity Emergence and self-organizing networks of actors Many heterigeneous global actors in virtual networks All linked with everything else, all linkages not known Pradoxal freedom of the actors (”both-and” instead of ”either-or”) Signifigance of immaterial issues (information, knowledge, services) Informal learning and serendipity Increased speed of activities and change Signifigance of transaction phenomena Complex responsive processes of relating Simultaneous agility and maturity requirements Immense pressure / stress of business leaders

(Refs.:D Zohar, R D Stacey)

Certainty and predictability

Modern business culture and operational environments add the business crises and conflicts and the importance to consider them consistently in business management.

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Activities in complex responsive processes of relating

High Certainty Low

High

LowA

gree

men

t

Standards Guidance Monitoring

Political control - compromise

Experimenting

Chaos

Anarchy

Innovation

Creativity

Debate

“Zone of Complexity”

Trial & Error

Appropriate management actions should be selected based on the degree of certainty and level of agreement on the issue in question.

3134/5.4.2006/jan (Ref.: Stacey, Ortner)

All kinds ofactivities may existin business processes.

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The Time Scissors - A Management Dilemma

1900 2000

Reactiontime

Time needed at increasingcomplexities

Time availableat increasing

dynamics

0664/2.9.2007/jan (Ref. K. Bleicher, D. Seghezzi)

Shortage of time (human resources) is a challenge and risk for business success. Business leaders have not time enough to think.

One may easily find examples from daily news how human mistakes - mainly due to shortage of time - have caused serious situations of crises.

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From time to haste in business

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(*) Time (abstract): An indefinite continuous duration, extent and point Time (personified): An aged bald man (but with a forelock) carrying a scythe and an hour-glassSpeed: Good luck, prosperity, rapidity

Elgin National Watch Company

Busy: to keep occupied; actively and attentively engaged in work or a pastime businessTimely: occurring at a suitable time; seasonable; opportune; well-timed Sudden: occurring without transition from the previous form, state, etc.; abrupt Agile: quick and well-coordinated in movement; lithe; active; lively; marked by an ability to think quickly; mentally acute or awareHasty: unduly quick; precipitate; rash; brief; fleeting; slight; superficial; impatient; impetuous; thoughtless; injudicious

(*) Online Etymology Dictionary

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Human performance in limits

Professor Pekka Niemi (the University of Turku) (*): “… people’s mental performance and ability to work often crumble precisely when things get complicated, as this also means great uncertainty”.

(*) Tieteen päivät (Science days) 20073360/2.9.2007/jan

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How people use their time and race against the clock

Results from the time use research: People have enjoyed more leisure time in the last twenty years. However, as the proportion of people other than workers in the population has increased – students and pensioners – the leisure time of 18 to 64 aged people has factually declined. Previously, the well-educated had more free time than those with less education. Today, those with education and responsible position work longer days than anyone else and have the least free time.

- Although statistics show that the amount of time spent in working per year has decreased, the total working time of those of working age has increased. Salaried work, work done at home and work-like activities have become confounded. - Highly educated workers do more things simultaneously than others.

In many fields work pressures have become unbearable – and recovering from them requires more time. This is often still combined with the pressures of the leisure time.

When we are pressed for time, we look for ways to use the time available more efficiently: we do things faster, replace a time-consuming activity with one that we can complete faster, do many things simultaneously, or set up a tight schedule for getting things done. These measures very often only lead to a feeling of greater urgency and to life becoming even more constrained.

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Attitudes towards time have changed.

People have started talking more and more about being busy. It has become a measure of success. It has become a blanket excuse that one can invoke with pride.

Highly educated people work long days, because their work is interesting but also because long working days have a high status nowadays.

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From haste to exhaustion at work

One obvious reason why people do not have enough time to do their jobs is that there are not enough of them in the workplace for the work that has to be done. The dog-eat-dog competition for profits and the absolute need to commit oneself to one’s work easily lead to exhaustion.

One is more easily aware of delays and missed deadlines. In particular, many members of the middle class are caught in the squeeze of knowledge work. Technology puts a strain on what we can reasonably take in. Information technology has not solved problems but, rather, brought new ones. Due to information flood we cannot concentrate on our work proper. Research has shown that office workers typically have less than fifteen minutes of uninterrupted working time. Interruptions place stress on the brain. One gets the feeling that one never has the chance to finish anything properly.

Also the other negative aspects of working life – uncertainty and unanticipated changes – have increased, and middle management in particular is suffering more than most from stress-related symptoms and a fear of work exhaustion.

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Work exhaustion has negative effects

Often underlying work exhaustion there are the excessive quantitative and qualitative demands of a job. If these demands constantly exceed a person’s resources, the resulting stress can lead to serious exhaustion. At this point, the person experiences general and long-term fatigue, and this feeling does not go away even during leisure time. Those who are susceptible to work exhaustion are often hard working and very committed to their work, frequently demanding more of themselves and taking on too much responsibility.

An exhausted worker takes a cynical attitude towards his or her work and it ceases to be enjoyable or sensible. These workers’ professional esteem is eroded and they begin to fear that they can no longer cope with their work. This feeling increases dissatisfaction, anxiety and various physical ailments. People’s personal relationships also suffer.

Night work causes shortage of sleep and tiredness. One night without proper sleep corresponds a serious state of drunkenness. Alcoholic itself is also often involved with the work exhaustion.

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Organizations (managers) have not enough time to think

Entrepreneurial activity, management in particular, requires deep know-how and knowledge in many specialized areas, e.g., security, quality, and human resources development. If a business does not have the time to develop a profound understanding of these matters and their underlying bases, it will drift into inefficient and even negative development where management is concerned. What typically happens is that things are: a) Limited only to immediate bug fixes and cures of symptonsb) Done superficially or by buying the services of dubious outside “experts”c) Allowed to drift, and everyone is quiet and hopes nothing bad will happen

A lack of time also causes business to lose their identity. What is more, there is no time for innovation either; the sources of innovation dry up. According to Dr. Deming, one requirement for doing business successfully is a profound knowledge of the company’s total operations in its business environment, of the actors involved, of how things fluctuate, and of changes and developments. Without this, the natural, even day-to-day operations of a company will be disrupted.

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“Blind leaders of the blind: If the blind leads the blind, both shall fall into the ditch.” (Matthew 15:14)

2808/1.6.2004/jan (Pieter Bruegel the Elder. The Parable of the Blind. 1568. Oil on canvas. Museo di Capodimonte, Naples, Italy)

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If one feels shortage of time that may cause depending on the person and situation: Stress

Work pressure, harassment, and oppression Burn out, a debilitating psychological condition brought about by unrelieved work stress, resulting in:

• Depleted energy and emotional exhaustion• Lowered resistance to illness• Increased depersonalization in interpersonal relationships• Increased dissatisfaction and pessimism• Increased absenteeism and work inefficiency

Shortage of time is an individual human issue

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0046/1.9.2007/jan

Risk of the work exhaustion(BBI, Bergen Burnout Indicator)

BBI Results: above 125 clinical (max 150)101-125 very high76-100 high51-75 low26-50 very lowunder 25 no

BBI Measurement:25 factors

Team Wholeorganization

Unit60

BBI

Verylow

Veryhigh

Low High

No of people

80

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A person working in his / her business process environment

Internal mental process:• Feelings • Appreciations (values)

3167/1.9.200/jan

Conscious tacit knowledge

Subconscious knowledge(individual and collective)

Intended business process:Activities for business targets and needs

Tacit knowledge

Explicit knowledge and information

Conflicts as business threat:- internal mental conflicts- external relationship conflicts

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Human business transaction

0060/1.9.2007/jan

In Out

Human, Emotional

Business, Rational

(Ref. Kaset International)

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Transactions:- Crossing- Supplementing- Hidden

3358/1.9.2007/jan

Transacting people

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Transaction analysis

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At any given time, a person experiences and manifests their personality through a mixture of behaviours, thoughts and feelings. There are three ego-states that people consistently use:Parent (P): A state in which people behave, feel, and think in response to an unconscious mimicking of how their parents (or other parental figures) acted, or how they interpreted their parent's actions. Adult (A): A state in which people behave, feel, and think in response to what is going on in the "here-and-now," using all of their resources as an adult human being with many years of life experience to guide them. This is the ideal ego state, and learning to strengthen the Adult is a goal of transaction analysis. While a person is in the Adult ego state, he / she is directed towards an objective appraisal of reality. Child (C): A state in which people revert to behaving, feeling and thinking similarly to how they did in childhood.

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Emotional hooks

2273/6.1.2002/jan

One’s personality“INTERNAL ELDER”Education

and training

EnvironmentSociety Culture Professional

activity, colleaguesPrivate life, friends

Private subconscious: Personal subconscious contents

Collective subconscious:General laws of the existence and life

Stopper

“Hidden intentions”

“INTERNAL CHILD”

“REALIZING ADULT”

Meeting with otherindividuals

Conscious mindand being (now)

Projections

Emotional hooks

(Ref. Saaristo)

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Conflicting people

Broadly used assessment tool for understanding how different conflict-handling modes affect interpersonal and group dynamics and respond to conflict situations include:

Conflict situations are those in which the concerns or interests of people appear to be incompatible. In conflicts, an individual's behavior can described along assertiveness (extent to which the person attempts to satisfy his own concerns) and cooperativeness (extent to which the person attempts to satisfy the other person's concerns).

1. Thomas Kilmann Conflict Mode Instrument:Assessment modes:• Competing • Accommodating • Avoiding • Collaborating • Compromising

2. Kraybill Conflict Style Inventory:Assessment modes:• Directing• Harmonizing • Avoiding• Cooperating • Compromising

3359/1.9.2007/jan

Conflict resolution is to resolve a conflict. Successful conflict resolution occurs by listening to and providing opportunities to meet each side's needs, and adequately address their interests so that they are each satisfied with the outcome. Conflict resolution aims to end conflicts before they start or lead to verbal, physical, or legal fighting. Conflict management refers to the on-going long-term management activity with intractable conflicts.

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Thomas Kilmann conflict behaviour modes

Assertivebehaviour

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Cooperativebehaviour

Competitive“I win you lose”

Avoiding“I lose you lose”

Collaborating“I win you win”

Accomodating“I lose you win”

Compomising½ win / win

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The basic concept: Crisis Management

Integrated crisis management:Coordinated activities to direct and control an organization with regard to business crises

Crisis management is a responsibility of the business management, and it is taking place through the managing actions of business leaders.

Experts have an assisting role in crisis management.

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Time, speed and agility in management standards

Management standards emphasize just in time or just on time but not consider the shortness or shortage of time. Time, speed and agility aspects are poorly included in the recognized management standards.

ISO TC 176 has under consideration a question how to take time, speed and agility into account in the ISO 9000 standardization for quality of management. In this context is also considered other related aspect, e.g. networking, innovation, collaboration, complexity, knowledge, learning and serendipity.

3352/7.9.2007/jan Ref.: http://www.zef.fi/service/user/?q=316

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(*) http://www.gwu.edu/~icdrm/publications/ShawTextbook011105.pdf

A framework for integrated business crisis and continuity management (*)

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Time is an essential element in applying the framework. Haste and shortage of time have detrimental impact for managing business crises properly.

(NFPA 1600, Standard on Disaster/Emergency Management and Business Continuity Programs, 2004)

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Inflexible, rigid, complex and formal systems may cause additional annoyance, stress and pressure in business operations – and even carry out their primary purpose ineffectively and inefficiently.- Examples: Too pedantically followed out standards based systems for quality, information security, airport security, etc. Following out standards easily keep status quo and hinder innovative development and cannot provide help for crisis situations. Systems defined by standards use “best practices” (= factually “past practices”) to realize and plan for generalized business needs and expectations. Real business events and incidents are, however, always unique, particular and single issues. Acute cases are remedied afterwards (“post-wisdom”).

An ‘incident' is any event which is not part of the standard operation and which causes, or may cause, an interruption or a reduction in the operation. The objective of incident management is to restore normal operations as quickly as possible with the least possible impact on either the business or the user, at a cost-effective price. (*)

3350/2.9.2007/jan (*) Ref.: ITIL

System standards should be used with intelligence and wisdom

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2343x/15.9.2006/jan

Model of a consistent business management: Deming (Shewhart) Cycle

ACTING:• Preventing actions• Improving actions• Re-engineering• Communicating• Recognizing and rewarding

PLANNING:• Business and management models• Business plan• Approaches and methodology

CHECKING:• Assessing the performance• Reviewing the performance

DOING:• Deploying the approach and achieving the results• Controlling operational performance• Corrective actions

A PC D

P = PlanningD = DoingC = CheckingA = Acting

Applying PDCA model:• Rational control (operational)• Continual rational small step improvement (operational), “Kaizen” approach• Innovative breakthrough changes (strategic)

Breakthrough management is the key area for crisis management.

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Hume’s Guillotine

From ’how things are’, one cannot draw conclusions ’how things should be’.• Only factual statements can follow from exclusively factual statements.

- Between the factual premises and the practical conclusions there is a gap, bridgeable only by a person’s willingness to engage in relevant activity or practice.

(Ref.: David Hume 1711-1776, Immanuel Kant 1727-1804)0692/3.9.2007/jan

Business problems, crises or conflicts cannot be solved only by facts.

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Facts & knowledge for managing business activities

Measuring

Data

Analysing

Information

Reflecting and decidingIntervention

Plan / Act

Effects

0609/25.3.2006/jan

Knowledge- explicit records- tacit knowledge(know-how, competence)

The performance reality of the company business processes

A P

DC

...

Wisdom- myths- values

”Ba”

Environments

Facts

You get what you measure

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Haste may lead to superficial and erroneous measures

Business event

Expectations, Prejudgments

Observation

Impulse, Intervention

New business event

Judgment

Reaction

- Misperception- Inappropriate emotional response- Rational analysis based on incorrect data- Intervention based on incorrect data

(Cognition, Analysis, Evaluation)

(Volition, Decision, Action)

(Sensation, Perception, Description)

GOALS: 1) Learn to distinguish inside yourself observations, reactions judgments and impulses to act (intervene)

2) Identify biases in how you handle each of these processes

1234

1 2

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(Ref.: Edgar H. Schein)3356/1.9.2007/jan

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Time is felt in a personal way.

“I am a great believer that if you can’t get something done in 50 hours a week you probably can’t do it in 150. … I do not really plan my daily performance. It reduces your freedom. I hate regimented planned days. You are always thinking about business where you are. A planned day may restrict creativity.” Robert E. Shaw, Shaw Industries, USA

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“Time is the key issue. I hate meetings and pointless memo writing. Meetings do not get things done, people do. … You know, you can work with something for four hours and achieve nothing. Someone else can finish it in 15 minutes, if they’re focused. That’s the key.” Jorma Ollila, Nokia, Finland

“We are being unproductive because we are in the activity trap – running into meetings, making telephone calls, going for lunch, and being active all of the time.” Ricardo Semler, Semco, Brazil

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Learning from most accomplished people of the world

Martti Ahtisaari, President of FinlandAkito Arima, Professor in physics, JapanPaulo Evaristo Arns, Cardina Archibishop, BrazilRafidad Aziz, Minister and economist, MalaysiaHector Babenco, Film director, Argentina, BrazilSusan Caroline Bambrick, Theatre director, ItalyLuciano Benetton, Entrepreneur, ItalyGeorges Blanc, Restaurant owner and chef, FranceOriol Bohigas, Architect, SpainJan Carlzon, Prsesident of SAS, SwedenRobert de Castello, World record athlete, AustraliaDennis Connor, Yachtsman, Cup winner, USAIvo Cramer, Choreographer, SwedenLindsay Fox, Entrepreneur, AustraliaKjell Fredheim, Executive vice president of SAS, NorwayPaulo Freire, Educator, BrazilValery Gergiev, Artist and conductor, RussiaMichel E. Heinecke, Businessman, USA, ThailandMasanari Iketani, CEO of Tokyo steel, Japan

Mariss Jansons, Orchestra conductor, NorwayCheong Choong Kong, CEO of Singapore airlinesTom Lasorda, Baseball team manager, USALars Löfgren, Theatre manager, SwedenFumihiko Maki, Architect, JapanWilma Mankiller, Principal in chief, Indian Cherokee nation, USAM.P. Narayanan, Chairman of Indian coal, IndiaCurt R. Nicolin, Indusrialist, SwedenArne Naess, Mountain climber, NorwayJorma Ollila, CEO of Nokia, FinlandWilliam G. Pagonis, Commanding General, USAAnand Panyarachun, Minister, top business executive, ThailandIeoh Ming Pei, Architect, USAEsa-Pekka Salonen, Conductor, Finland Ricardo Semler, Businessman, BrazilRobert Shaw, Business leader, USADick Smith, Adwenturer, entrepreneur, AustraliaBert-Olof Svanholm, CEO of ABB, SwedenMike H. Walsh, CEO of Tenneco, USA

3355/1.9.2007/jan (Ref.: Bjelland, Dahl &Partners)

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Personal world-class performance

WORLD CLASS PERFORMANCE

Focus Mastery Intensity Integrity

AWARENESS

Openness in learning / receptiveness

Personal Inter-personal

Action Ethical

0850/3.9.2007/jan (Ref.: Bjelland, Dahl& Partners 1993)

Awareness:- General and multi- disciplinary awareness- Contextual awareness

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1592/3.9.2007/jan (*) Otto Mäkilä 1939, Turku art museum, Finland)

"They see what we do not see." (*)

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Lao Tsu (*): Tao-Te Ching, Poem #26: “Lightly strong”

“Gravity is the root of lightness; stillness is the ruler of movement.Therefore a wise prince, marching the whole day, does not go far from his baggage wagons. Although he may have brilliant prospects to look at, he quietly remains in his proper place, indifferent to them. How should the lord of innumerable chariots carry himself lightly before the kingdom? If he do act lightly, he has lost his root; if he proceed to active movement, he will lose his throne.”

3366/5.9.2007/jan (*) c. 600 B.C.E.

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Arjuna’s crisis: “Kill the relatives”

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As a business leader you must do your duty. They must win their enemies although they were your nearest relatives.

“Therefore get up. Prepare to fight and win glory. Conquer your enemies and enjoy a flourishing kingdom. They are already put to death by My arrangement, and you, O Savyasaci, can be but an instrument in the fight.” (Ref.: Gita 11-33) (*)

(*) The Bhagavad Gita

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Sun Tzu (*): “Attack your own plans”

SunTzu gave the advice that to win the battle one should not attack the enemy but the enemy’s plan.

Today we find ourselves asking what that plan is. In the business world, the situations we face are often polarized to the point where we see competitors as the enemy. This attitude runs contrary to old as well as modern principles, which steer us toward networked, win-win cooperation.

You are our own worst enemy with your dyed-in-the-wool thoughts, principles and procedures. These are what must be overcome. The important thing is to develop ourselves and develop what we do to keep operations viable.

In terms of modern team sports, one could say that the goal is not to beat your opponent but yourself. The key is to overcome stagnated ideas and detrimental routines.

3367/5.9.2007/jan (*) c. 544 BC – 496 BC

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Self-management

• Being aware of one’s own spiritual process and its performance in business environments and recognizing

– limitations of rationality– significance of non-rationality– effect of irrationality

• Considering situation unbiased– quieten down for observing purely

(senses and mind)– becoming clearly conscious of one’s

own intentions and opportunities– liberating intuition to creativity and

rational decision-making

• Acting straightforwardly without prejudice

– using all knowledge, information, abilities, etc.

– focusing to the essentialities– acting with sincerity and empathy– communicating naturally

• Developing continually oneself in practical everyday activity

– seeing one’s identity and duty and the relevant operating environment

– enhancing understanding– organizing own time and activity– using beneficial tools and skills

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Paradox of speed in business management

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A prerequisite for increasing speed is to stop (*):• to think and understand the situation• to create premises for speed

Systemic capacity for reflecting = to have time. Mental models & mental systems, the collective mind of the company.

But how to get in practice busy business leaders to stop a while!

(*) Danah Zohar

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Getting to the root cause through “5 Whys”

The 5 Whys is a simple problem-solving technique that helps users to get to the root of the problem quickly. Made popular in the 1970s by the Toyota Production System, the 5 Whys strategy involves looking at any problem and asking: “Why?” and “What caused this problem?”

Example:1. Why is our client, Hinson Corp., unhappy? Because we did not deliver our services

when we said we would. 2. Why were we unable to meet the agreed-upon timeline or schedule for delivery? The job

took much longer than we thought it would.3. Why did it take so much longer? Because we underestimated the complexity of the job. 4. Why did we underestimate the complexity of the job? Because we made a quick

estimate of the time needed to complete it, and did not list the individual stages needed to complete the project.

5. Why didn't we do this? Because we were running behind on other projects. We clearly need to review our time estimation and specification procedures.

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(Ref.: Model-Netics)0001m/10.5.2007/jan

Why?

What?

Who?

How?Where?

When?

Action Compass

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Systemic management of business resources

Managing based on system recognition and feedback loops.

(Ref.: Repenning & Sterman)

Plus ca change, plus c'est la

même chose

Stop to think

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Deepness in knowing and learning

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1. Know

3. Apply

5. Synthesize

Passive knowing, reproducing, and quoting knowledge produced by others

Active applying knowledge in new situations, solving problems

Assessing value and making choices and recommendations for innovative reforming, critiquing attitudes and beliefs

(Ref.: Bloom, Mayer)

6+. Metacognitive skills to understand how the learner learns. Awareness of one’s own knowledge and ability to understand, control, manipulate, and making own ideas questionable

2. Comprehend

4. Analyze

6. Evaluate

Finding meanings, interpreting facts, inferring cause & consequence

Recognizing and explaining patterns and meanings, seeing parts and wholes

Composing knowledge, creating new ideas, predicting and drawing conclusions

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Informal learning

3330/20.6.2007/jan

Informal learning Joe Cross: Informal learning – The other 80%http://internettime.com/Learning/The%20Other%2080%25.htm#_Toc40161533

Serendipic learningParasitic learningTeemu Arina: Serendipity 2.0: Missing third places of learvinghttp://tarina.blogging.fi/2007/06/23/serendipity-20-missing-third-places-of-learning/#comments

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Old learning theories

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• Cognitivism takes a computer-like information processing model. Learning is viewed as a process of inputs, managed in short term memory, and coded for long-term recall. Knowledge is viewed as symbolic mental constructs in the learner's mind, and the learning process is the means by which these symbolic representations are committed to memory. • Pragmatism (similar to cognitivism) states that reality is interpreted, and knowledge is negotiated through experience and thinking. • Behaviorism and cognitivism view knowledge as external to the learner and the learning process as the act of internalizing knowledge. • Objectivism (similar to behaviorism) states that reality is external and is objective, and knowledge is gained through experiences. • Constructivism suggests that learners create knowledge as they attempt to understand their experiences. Constructivism assumes that learners are not empty vessels to be filled with knowledge. Instead, learners are actively attempting to create meaning. Learners often select and pursue their own learning. Constructivist principles acknowledge that real-life learning is messy and complex. • Interpretivism (similar to constructivism) states that reality is internal, and knowledge is constructed.

(Ref. G. Siemens)

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Innovative collaborative networking in three dimensions

3169/20.9.2006/jan (Ref.: Peter Gloor: COIN = Collaborative Innovation Network))

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Skills andcapabilities

Awareness andsensibilities

Attitudes,interests,

and beliefs (1) Guiding ideas

(3) Innovativemanagementinfrastructure

(2) Theory, methods,and tools

Continuous strengthening an organization’s managerial basis for confronting challenges

1325x/15.2.2004/jan

Performanceexcellence

(Ref.: P. Senge, Learning organization)

Domain of change

”Pumpeffect” (**)

Domain of action (business activity) (*)

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Crisis management ensuring organization's performance improvement

(*) Ref.: Cranfield School of Management3171/20.9.2006/jan

1. IMMOBILISATIONShock - Mismatch betweenexpectations and reality

2. DENIALDefensiveness - Retreatinto false competence.Denial of needto change

3. INCOMPETENCEAnger, frustration and confusion - Awareness that change is necessary but unsure what to do.

4. ACCEPTANCE OF REALITYSadness - Letting go to pastattitudes and behavior.Excitement - At prospect ofimproved performance

5. TESTINGTrepidation - Trying newapproaches and copingwith risk of failure

6. SEARCH FOR MEANINGCuriosity - Trying to understand how and why new behaviors are better.

7. INTEGRATIONConfidence - New attitudesand behavior becamepart of behavioralrepertoire

Businessperformance

Beginning a transition Time

The universal curve of transition (*)

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Conclusions

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• Business crises are turning points in a decisive change of business priorities.• Conflicts of interests and uncertain business environments aggravate decision-

making and -implementing in crises situations.• Haste is waste in itself and additionally a remarkable factor to generate business

crises and conflicts. Haste should be taken seriously as a threat to business performance and

sustainable success.• Crisis management should be integrated with in normal business management

activities by the business leaders’ responsibility. • Sound management practice by using profound knowledge is a steadfast basis in

confronting business crises. • Effective and transparent communication and learning through collaboration

increase holistic business awareness and abilities to cope with business crises and conflicts.

• Ultimately all business systems and their use are based on and impacted by decisions of authorized and powerful individuals and relationships between involved people.