Understanding organisations as living systems value creation machines creates leadership that is empowered for a new class of organisational performance management.
If you were the director of a factory producing widgets, you would know the throughput of your machines, the value of the product, and the cost of upgrading the machinery. You would be able to make a rational decision to invest to upgrade specific machines, or overcome bottlenecks, so the factory could produce more widgets… if it was going to be profitable to do so.
Our directors have oversight responsibility of value creation factories producing knowledge, services and ‘intangible’ non-financial value. They have no visibility of the throughput of the machine. They cannot determine what upgrade might be effective, if the cost of the upgrade is justified, or if their upgrade investment will make (or has made) any difference. They are blind. They are left to make investment decisions on gut feel, trust in others’ visibility-impaired judgements, to put their money somewhere else, or to do nothing at all.
Emerging approaches are available that now let us measure our value creation capacity. Empowered by evidence, a new generation of captains of our intangible value creation machines will be able to fly to greater heights. They will know the throughput of the value creation machines under their care. They will know the cost of an upgrade, the quantum of extra value creation capacity that upgrade will delivery, and they will know the prevailing market conditions of opportunities and risks.
Simple decisions to act will follow.
The throughput of the machine will be measured. Executives whose facilitation of actions that increase the throughput of the machine will be rewarded. Executives who fail develop corporate capacity will be called to account.
Boards will be able to consider the demonstrated value-creation capacity of their organisation as it changes over time, and determine if they are have the actual proven capacity to achieve their objectives. In the light of evidence, boards will be empowered to consider whether either their goals, or the management of the organisation, needs to change.
A new generation of leaders will have tools that give visibility of the throughput of their corporate flying machines, and will take measured steps to improve those systems, to influence their teams to greater aligned performance, and to deliver a step-change in realization of the potential of their organization.
Themes Explored In This Keynote Address
Danny’s futurist foresight is a powerful meeting of the latest global research, the leading edge of enhanced professional disciplines, thousands of real-world observations of corporate behaviours, and his unique way of unpacking complex issues through systems thinking, economics, social philosophy, pragmatism, positivity… and humor.