Loe raamatut: «Managing in a Complex World»
| utb 5299 |  |
A cooperation of following publishers
Böhlau Verlag · Wien · Köln · Weimar
Verlag Barbara Budrich · Opladen · Toronto
facultas · Wien
Wilhelm Fink · Paderborn
Narr Francke Attempto Verlag · Tübingen
Haupt Verlag · Bern
Verlag Julius Klinkhardt · Bad Heilbrunn
Mohr Siebeck · Tübingen
Ernst Reinhardt Verlag · München
Ferdinand Schöningh · Paderborn
Eugen Ulmer Verlag · Stuttgart
UVK Verlag · München
Vandenhoeck & Ruprecht · Göttingen
Waxmann · Münster · New York
wbv Publikation · Bielefeld
Johannes Rüegg-Stürm
Simon Grand
Managing in a Complex World
The St. Gallen Management Model
Haupt Verlag
Johannes Rüegg-Stürm is Professor of Organization Studies and Director of the Institute for Systemic Management and Public Governance at the University of St. Gallen (HSG), where he heads the Organization Studies Research Center. He has long-standing experience as a process facilitator, consultant, coach, member and president of boards of directors, speaker, and academic leader of entrepreneurial training initiatives for systemic management development.
Simon Grand is Associate Professor of Strategic Management and Management Innovation, Academic Director of the RISE Management Innovation Lab at the University of St. Gallen (HSG), and Research Fellow at the Zurich Center for Creative Economies of Zurich University of the Arts (ZHdK). As a management researcher, strategy designer and member of several boards of directors, he works with entrepreneurs and executives to develop entrepreneurial strategies and effective corporate governance and management practice.
This book was translated by Dr. Mark Kyburz & by Jay Binneweg, M.A. HSG.
1st edition : 2019
Bibliographic information published by Die Deutsche Nationalbibliothek
Die Deutsche Nationalbibliothek lists this publication in the Deutsche
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Copyright © 2019 Haupt, Bern
This book, including all of its parts, is protected by copyright. Every kind of use beyond the limits of the narrow restrictions of the law of copyright is not allowed without the explicit consent of the editor. Noncompliance to this restrictions are inadmissible and criminal. This applies equally for the duplication, translation, microfilming as well as for digital storage and subsequent of the book or any of its parts.
Layout: Alltag Agentur, St. Gallen
Translation: Mark Kyburz & Jay Binneweg
Cover design: Atelier Reichert, Stuttgart
eBook distribution: Brockhaus Commission, Kornwestheim
UTB number: 5299
ISBN 978-3-8252-5299-1(Book)
ISBN 978-3-8463-5299-1(eBook)
Preface
Managing in a Complex World is based on “The St. Gallen Management Model” (SGMM). The SGMM follows a long and rich tradition of presenting in didactic form a theoretically and empirically sound examination of management abreast with current management practice and the latest research developments and findings. This book is a translation of the German original (published in September 2019).
At the end of the 1960s, it was a pioneering achievement to explore management – as the challenge of coping with complexity – from a systems theory perspective, which was quite unusual at the time (Ulrich, 1968). The resulting insights were made accessible to teaching and practice by Hans Ulrich and Walter Krieg (Ulrich & Krieg, 1972), two pioneering scholars at the University of St. Gallen (HSG), as the St. Gallen Management Model.
The SGMM has always intended to contribute to the holistic understanding and integrative treatment of complex management challenges in their unique and differentiated contexts. To this day, this concern has lost none of its relevance.
The present version of the SGMM draws on a long scientific tradition. In particular, it includes ideas and thoughts from several earlier publications: J. Rüegg-Stürm, The New St. Gallen Management Model (2004) and J. Rüegg-Stürm & S. Grand, Das St. Galler Management-Modell. Wissenschaftliche Grundlagen und Praxisbeispiele (2017). At the same time, it consolidates the fundamental insights of our empirical research in recent years and harnesses the scientific potential of practice theory and autopoietic social systems theory. In addition to outlining the scientific basis of the SGMM (Rüegg-Stürm & Grand, 2017), we have conceived this current edition as a working tool along stringent didactic lines. It also serves critical self-reflection for an in-depth examination of management.
The SGMM is available as a printed book and as an eBook. It supports both educational purposes and entrepreneurial practice in further developing organizational value creation. The SGMM also includes a number of didactic visualizations, which have been specially designed to facilitate working with the model. The visualizations can be downloaded from www.sgmm.ch. [5] The latest version of the SGMM distinguishes a task perspective from a practice perspective. Both perspectives are informed by current research in the social and cultural sciences. Both perspectives highlight key aspects of management practice and complement each other.
Our research partnerships with enterprises and organizations from highly diverse contexts (e.g., industrial groups, technology companies, design agencies, research organizations, hospitals, and public utilities) have time and again highlighted the importance of self-critically examining both one’s own understanding of management and management practice as lived and experienced every day. This examination of management provides unfamiliar perspectives on the interplay of environment, organization, and management practice. These perspectives enable those responsible for an organization to discover new possibilities for development and action.
In this sense, the SGMM cannot be “introduced” in an organization, but instead may serve as a tool to tackle specific tasks. The SGMM may help structure constructive debates about important entrepreneurial issues. And it may also serve as a source of inspiration for developing an organization-specific management model.
Acknowledgments
We have only been able to further develop the SGMM, presented between these covers, thanks to our inspiring cooperation with many colleagues from the scientific community, in particular the University of St. Gallen, and from business practice. On behalf of many colleagues, we would like to thank our team colleagues Simone von Wittken, Christian Erk, Marc Krautzberger, Matthias Mitterlechner, Torsten Schmid, Thomas Schumacher, and Harald Tuckermann. We also thank our colleagues Kuno Schedler, Thomas Bieger, Pietro Beritelli, Dirk Schäfer, Florian Hohmann, Mathias Müller, Thomas Friedli, Urs Fueglistaller, Thomas Zellweger, Alexander Fust, and Frank Halter. They are all personally committed to anchoring the tradition of the SGMM at the University of St. Gallen and play a key role in its further development through their work. Particularly inspiring and enriching was our intense exchange of ideas with Hansjörg Siegenthaler and Elisabeth Michel-Alder, as well as with Martha Feldman, Ann Langley, Ann Cunliffe, Robert Chia, Alfred Kieser, Henry Mintzberg, Davide Nicolini, and Rudolf Wimmer, in the context of our “Distinguished Management Scholar Series.” [6] While developing, realizing, and finalizing this text, we have received tireless support from our committed, professional, and patient project team. Special thanks go to Naomi Kink and Andreas Schwendener. They have supported us not only with excellent project management but also with many inspiring ideas, which have considerably enriched this book. We thank our translators, Jay Binneweg and Mark Kyburz, for their tireless commitment and painstaking attention to detail. We also wish to thank Victoria Hotz and Flavio Tschopp, who have provided valuable advice on making this book more accessible. Our very special thanks go to Monika Steiger for providing the conditions under which we are able to tackle our daily work at the Organization Studies Research Center of the Institute for Systemic Management and Public Governance (IMP-HSG).
We are grateful to the project team at Alltag (Gloria Weiss, Phillip Bührer, and Rachel Kühne), whose patience and creative inspiration have produced visual materials that works, as well as a neatly designed, aesthetically pleasing book. Finally, we wish to thank Matthias Haupt for being an excellent publisher.
We have co-authored this book from start to finish. The fact that our endeavor has borne fruit is not self-evident. It is not our achievement alone, but the result of a mixture of intellectual joy, trust, friendship and happiness, for which we are grateful.
St. Gallen, October 2019
Johannes Rüegg-Stürm & Simon Grand [7]
How best to approach this book
The St. Gallen Management Model (SGMM) is not simply a collection of conceptual frameworks. Instead, it presents two complementary perspectives on the interplay of environment, organization, and management in the form of an integrated model. Together, these interacting perspectives – the task perspective and the practice perspective – form the SGMM.
• The task perspective focuses on the two core tasks of management: first, to provide business-oriented analysis; second, to design organizational value creation. As such, this perspective also examines the analytical tools needed to perform these tasks.
• The practice perspective illuminates the fundamental cultural and communicative preconditions for management to achieve impact. We adopt this perspective to familiarize readers step-by-step with new ways of thinking about environment, organization, and management.
We are convinced that exploring innovative visions of the future and possibilities for action, and opening up to critical reflection what might otherwise be unquestioningly considered self-evident, requires developing new and thus unfamiliar forms of language and thought.
With this in mind, we hope that interested readers will approach this book unbiased. Working with the SGMM ought to serve two purposes: first, to generate new and helpful ways of thinking about management practice; second, to help deepen and reflect on these insights together with colleagues, perhaps also in connection with pursuing a degree or executive training in management. We hope, moreover, that the management practices established at a specific organization, as well as the associated challenges, may also become the subject of the kind of reflection suggested here.
We have provided several aids to support readers as they work through this book. The SGMM is structured according to a number of basic principles. Knowing these facilitates reading the book and working with the model. [9]
• Important definitions and terms are italicized (and thus highlighted). They can also easily be found in the subject index.
• The model categories of the SGMM are presented and explained in the introductions to the task perspective and the practice perspective. These two perspectives and their interplay become more understandable as readers become more familiar with the entire model. Conversely, a solid knowledge of the individual model categories promotes overall understanding of the model. Hence, we suggest that readers not only read through each chapter once, but also delve deeper into especially relevant sections.
• Understanding the model will depend on one’s own grappling with its components and thus on one’s willingness to constructively and critically illumine specific topics based on one’s own work context.
• Managers may use the SGMM to initiate fundamental processes of clarification and reflection, on the one hand in general conceptual terms and on the other in concrete design terms. The term “strategy” illustrates this particularly well:
– The term “strategy,” which we introduce as a model category in the SGMM’s task perspective, has manifold meanings in science and practice. Managers must clarify which aspects, phenomena, and facts of organizational reality the term “strategy” represents and should be used for in daily practice. Hence, one needs to fundamentally clarify the meaning of strategy in general and define how strategy ought to be understood. This serves to develop a common understanding of strategy as a general concept among managers. [10]
– On this basis, one needs to simultaneously clarify what a specific organization’s “strategy” consists of concretely. What is its core? How does it become visible? What is it meant to achieve? The SGMM’s practice perspective includes various considerations and forms of description. These facilitate precisely describing an established strategy in its complexity and “communitizing” its understanding by the responsible managers. This, in turn, is an important prerequisite for further developing a strategy, jointly and purposefully.
• In order to help our readers develop a good overall understanding of the SGMM, we have cross-referenced important topics, terms, and illustrations. The four main chapters are abbreviated as follows:
– Introduction: INT
– Task perspective: TPP
– Transition to the practice perspective: TRA
– Practice perspective: PPP
Chapter abbreviations are followed by a reference to the corresponding section. For example, chapter 5.4.1 (“Cultural understanding”) in the task perspective is cross-referenced as follows: (→ TPP, 5.4.1).
In sum, the SGMM invites managers to work together with their teams on topics and challenges so as provide additional and novel scope for action and development with a view to advancing organizational value creation.
Saying that, the SGMM also invites teachers and students to experience, in a new way, the interplay of environment, organization, and management of organizations with which they may already be familiar, and to critically reflect on selected topics. Visit www.sgmm.ch for additional information and teaching materials. [11]
Preface
INTRODUCTION
1 Why is a detailed examination of management more important than ever?
The term “management” is ubiquitous nowadays. Nevertheless, what management really is, or rather what its core is, often remains vague. Thirty years ago, Hans Ulrich spoke of a “societal function that is not understood” (Ulrich, 1984). He thus highlighted that although management is highly important, not only economically but also societally, its importance is often not explicitly addressed. Second, he indicated that the core of management is actually far from obvious (Malik, 2013; Tsoukas, 1994; Watson, 1994). We consider this unsatisfactory. Not only because management is so omnipresent today but also because it is becoming increasingly important and demanding (Cunliffe, 2014; Mintzberg, 2009; Ulrich, 1984).
Here we mean the core purpose of management, which often remains undefined in business administration (Malik, 2013; Ulrich, 1984): to shape value creation through division of labor, as today’s organizations do in the form of products and services for specific value creation addressees (customers, citizens, patients, students, etc.). Such value creation is increasingly preconditioned. It depends on specific knowledge, complex integrated processes, elaborate technical expertise, and sophisticated physical and technological infrastructures. Often, value creation also involves a large variety of actors, who may perceive and evaluate the value of value creation very differently in its overall context.
The three examples below illustrate just how diverse and complex modern value creation is:
• Take a young biotech enterprise: Its basic value creation may lie in developing new medication for cardiovascular disorders. Central to this value creation are scientific findings on mechanisms of action in the human body, new R&D processes (e.g., from systems biology), and new technologies (e.g., digital simulation models). These are sometimes developed by the company itself, sometimes in partnerships with other startups and established corporations, and sometimes are also taken over from these. At the same time, it is important to attract the best employees in the relevant fields of knowledge and to secure the necessary financial resources in several funding rounds. The key tasks – structuring this complexity, setting the right priorities, and establishing robust partner relationships with different stakeholders – all require effective management practice. [20]
• Or an orchestra: Its central value creation may lie in performing excellent concerts and going on successful tours, or in producing special recordings. Yet societal changes and digitalization are fundamentally changing the context of value creation: Concerts must reach new target groups (e.g., younger generations), tours intensify competition among orchestras (such competition is often global), the distribution of recordings is subject to new technical conditions (streaming, YouTube, etc.) and to altered economic rules of the game involving completely new business models. At the same time, orchestras need to keep offering traditional concerts and reinterpreting music for the present. These changes and the associated uncertainties must be carefully addressed by effective management practice.
• Or a hospital: Its central value creation lies in treating and healing patients. Medical and technical progress is leading to increasing specialization among doctors, nurses, therapists, etc. At the same time, technological support is growing in various areas (diagnosis, treatment, and patient data management). While medical records must now be kept electronically, patients may obtain wide-ranging information about their illnesses online. This is changing the relationship between health professionals and patients from a patronal relationship to a partnership. In addition, the growth in new treatment options, with corresponding resource requirements, substantially exceeds the financial resources flowing into healthcare through tax revenues, health insurance premiums, and self-paying patients.
As a result, not only treatment decisions are becoming more complex, but so are decisions associated with devising treatment offerings, as well as developing and efficiently using physical and technical infrastructures, medical devices, IT systems, etc. Medical or care-related knowhow alone no longer suffices to meet this challenge. What is required is effective management practice, one capable of integrating changing treatment options, associated patient expectations, and the ambitions and demands of different professions to advance innovative patient-centric value creation.
Against the background of these three examples, chapter 2 explains in detail the key reference point of management: organizational value creation. Chapter 3 introduces the SGMM, illustrates the purposes of management models, and explains how the SGMM came about. [21]
2 Organizational Value Creation: The Key Reference Point of Management
2.1 Value Creation as Outcome and Process
Management is not an end in itself, but always concerns organizational value creation. The term value creation refers to two distinct, yet closely related issues:
• On the one hand, value creation means the outcome of value creation, i.e., products or services (or effects in general), from which value creation addressees (e.g., customers, patients, or a concert audience) can derive a specific benefit.
• On the other, value creation means the value creation process, i.e., all activities leading to the outcome of value creation (such activities include inbound logistics, production and outgoing logistics, marketing, distribution, and customer service). Any value creation process can be greatly simplified and schematized as a “value chain” (Figure 1).
When the SGMM speaks of value creation, we always mean both aspects, because the outcome can never be understood and designed without the process.
Figure 1: Value chain (Porter, 1985: 37) [22]
