8/7/2019 Management Focus Issue 30
1/17
Inside
Collaborate to Innovate
Global Power Shift
Innovating with IT
Project Managers: Lessons Learned?
Releasing Time to Manage
Working through the ZOUD
Issue 30 // Spring 2011 www.som.cranfield.ac.uk/s
ManagingthePriceof
Food
FocusManagement
The Magazine of Cranfield School of Management
8/7/2019 Management Focus Issue 30
2/17
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Cranfeld School o ManagementCranfeld, Bedordshire, MK43 0AL, UK
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2011 Cranfeld University.All rights reserved.
04
20
08
22
10
24
14
26
News
Global PowerShit
Innovating
with IT
ProjectManagers:
Lessons
Learned?
Releasing Time
to Manage
Collaborateto Innovate
Working
through theZOUD
Alumni interview:Howard Dickel
(MSc PPM 2010)
16 Managing the Price o Food
The world continue
a remarkable pace a
the worlds leading m
schools, it is our aim
individuals and organ
stay ahead with the
and research.
Our faculty, which is
largest and most div
business school in E
actively engaged in c
and business relevant research and are closely in touch with the
business and government. Their commitment to our mission of t
knowledge into action and management practice means they are
current and topical in their teaching. They bring not only experie
to their programmes. They understand your challenges. They hav
themselves and they can help you to do the same.
A combination of rigorous research and inspirational teaching is
of everything we do. We are dedicated to making a difference - c
responsible management practice, improving business performan
inspiring the next generation of leaders. We work to change the
students and executives by encouraging innovation and creative t
as the drive to succeed and make a real impact on their organisat
This edition of Management Focus tackles some of the many issu
managers today, from knowing when and how to innovate to ma
effective top team. San Rickard discusses what needs to happen
manage the spiralling cost of food and Professor David Buchanan
Dr Emma Parry share the early ndings from their three-year re
investigating the realities of front-line managers in the NHS.
I do hope you enjoy the read.
Proessor Frank M HorwitzDirector, Craneld School of Management
You can download the magazine at
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Contents Edit
"We are dedicated to
making a difference
- creating responsible
management practice,
improving business
performance and
inspiring the next
generation of leaders."
8/7/2019 Management Focus Issue 30
3/17
Professor Frank Horwitz, Director
of School hosted the Schools
annual awards evening at the Royal
Institutions Faraday Theatre in London
in January. The awards recognise
the very considerable achievements
of alumni and students. Guest
speaker, Warren East (EMBA 1990)
CEO of ARM Holdings, who was
announced at the event as the 2011
Distinguished Alumnus,
Congratulations to Professor Richard
Wilding who received the prestigious
Individual Contribution Award at
the recent European Supply Chain
Excellence Awards. Richard is pictured
with the host of the evening, comedian
Rufus Hound and Mark Judge who
presented him with the award.
Professor Wilding has been
described as one of Europes leadinggurus for supply chain excellence,
The Craneld Knowledge
Interchange (KI) Online has
recently been redesigned and now
offers an even easier route to
the latest relevant and respected
management information from
Craneld. The site gives subscribers
access to a unique blend of
resources, new concepts, latest
publications and presentations. This
exclusive service enables managers
to use the resources for personal
development and business.
In January, Harry Clarke was
presented with the 2011Craneld
Entrepreneur Alumnus of the Year
award. Harry, Commercial Director
at Cobalt Telephone Technologies
completed his Craneld MBA
in 1992. The award is presented
annually to the alumnus who has
made an outstanding entrepreneurial
achievement and promotes the strong
entrepreneurial spirit present withinthe School alumni body.
Distinguished Alumnus Knowledge Online
Entrepreneur AwardSupply Chain Award
News
gave a presentation titled The
future is in our hands. Warren
talked about how we, as consumers,
can exercise intelligent choices
about how and where we spend
our money and that these choices
impact directly on global issues.
His company ARM Holdings is the
major European designer of silicon
chips that provide the brains behind
countless digital devices.
promoting supply chain innovation
in an easily accessible way for nearly
20 years.
Richard has helped develop Cranelds
Centre for Logistics and Supply Chain
Management into a leading centre of
excellence. The Centre provides an
international focal point for advanced
teaching and research in the eld of
logistics, supply chain management andtransportation management.
The uture o ood
Cranelds Executive Doctorate (D
programme has been awarded the
5 year accreditation by the Associa
of MBAs (AMBA). It is one of onl
AMBA accredited DBA programm
UK (and only seven worldwide), w
testimony to the high standard and
quality assurance of its programme
international scale.
Senior Business Economist, San R
was commissioned to write a repo
value of crop protection which wa
by the Crop Protection Associatio
report was launched at the annual
House Food Security Conference
attended by some of the most inu
speakers in agricultural developme
a leading commentator on food, fa
rural policy issues and is often calle
advise the government.
International accre
VentureDay 2011
The Schools Bettany Centre will h
2011VentureDay on 12 May. The o
conference and networking event
at entrepreneurs and those interes
cutting-edge entrepreneurial perfoKeynote addresses will be given by
entrepreneurs including Harry Cla
former media tycoon Eddy Shah.
S P R I N G 2 0 11 MF MF
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News
Research
The 2010 Female FTSE report from
the Schools International Centre for
Women Leaders revealed another
year of barely noticeable change in
the number of women in
leadership positions of the UKs
top 100 companies.
The report, complied by Professor
Susan Vinnicombe OBE, Dr Ruth
Sealy, Jacey Graham and Elena Doldor,
detailed that there are just 135 female-
held directorships out of1,076 on the
FTSE100 boards. The latest gure of
12.5% highlights a three year plateau
(12.2% in 2009 and 12% in 2008)
signifying a situation of stagnation
when it comes to diversity in
British boardrooms.
Equalities Minister Lynne
Featherstone said: It is worrying
that women who make up more
than 50% of the population still
account for just one-eighth of
FTSE 100 directors. Making boards
more diverse is not about political
correctness - its about making sure
companies draw senior staff from the
widest possible pool of talent, whichis good for business, good for staff
and good for customers.
Diversity report has huge impact
A study into public sector innovation
carried out by Professor Keith Gofn
and Dr David Baxter showed that public
sector managers need more guidance on
commercial partnerships in order
to make them work effectively.
A survey revealed that only a minority of
respondents were able to give examples
of successful service innovations in theUK public sector, and very few of these
examples were commercial partnerships.
Public sectorinnovation
Change at any age
A new study led by Dr Emma Parry,
has revealed that there is considerable
stagnation in the careers of many over
50s. The research conducted for the
Employers Forum on Age (EFA) found
that many employers are not currently
doing enough to prevent this and the
loss of skills and attitudinal problems
that result.
Mobile savvshopper
A new report co-autho
Dr Silvia Rossi and Prof
Wilding raises serious q
the ability of Britains cu
infrastructure to suppor
development of mobile
that provide shoppers w
product information. Th
partnership with GS1 U
quality of product descr
data available in three of
downloaded third-party
scanning apps. Only 9%the correct product des
compared with the app
Ineective salesbehavioursThe Harvard Business Review (HBR)
recently published an article discussing
Cranelds research project wit h sales
consultancy Silent Edge. The article by
Professor Lynette Ryals highlights the
key ndings from the project. Craneld
worked with data, provided by Silent
Edge, analysing the performance of 800
sales professionals observed in live sales
interactions. The results identify eight
sets of behaviours in sales meetings. By
understanding these behaviours, managers
can effect changes in their current sales
force and recruit better team members in
the future.
Key ndings of a signicant new
piece of research from Professor
Michael Dickmann and Dr Emma
Parry have revealed International
NGOs widely agree that they must
improve the speed, quality and
effectiveness of their humanitarian
leadership response to overcome
the challenges that arise from climate
change, global insecurity, scarce
resources and increasing scrutiny
from a wide range of stakeholders.
The research is the result of a joint
initiative by Craneld and People In
Aid. Funded by ELRHA, the research
aims to help agencies understand the
nature and scope of internationalleadership competencies required
over the next decade.
Leadershipchallenges
Lord Davies of Abersoch, former
Labour trade minister was asked by
Business Secretary Vince Cable and
Minister for Women Theresa May
in August last year to carry out a
review to increase the representation
of women on the boards of UK
companies. Professor Susan
Vinnicombe, Director of Cranelds
International Centre for Women
Leaders was a member of Lord Davies
steering committee. The report
Women on Boards was published on
24 February. Cranelds Female FTSEreport was referenced extensively in
articles about the review.
S P R I N G 2 0 11 MF MF
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IT
by Joe PeppardProessor o Inormation Systems
Innovatingwith
A ramework developed by Cranfeld can help
organisations to consider and assess their
current approaches to business innovation with IT.
nformation technology is
now part of the very fabric
of almost all organisations.
Indeed, few could survive for very long
without their IT systems. While IT
provides tremendous opportunities
for innovation, most non-technology
organisations struggle to take advantage
of these opportunities. A global survey
that we conducted as part of our
research to help such organisations be
more proactive in their approach to
business innovation with IT, revealed that
only 14% of large companies believe that
they are maximising the potential of IT.
This is an astounding statistic given the
potential that technology offers.
Opportunities for IT innovation
come from one of two sources. ITmay respond to requirements that
come from the business, what is known
as business-pull. Alternat ively, IT-push
Isees emerging technology or new
combinations of existing technology
provide the motivating force for
business innovation.
If the IT innovation agenda is going
to have any real chance of success,
there must be an acute awareness of
the trade-off between push and pull
factors. While our data revealed that
over 80% of innovation is instigated
by demand-pull factors, this results in
more incremental innovation. A good
way to describe the limitations of such
pull is to think of the famous Henry
Ford quote: If I had asked people
what they wanted, they would have
said faster horses.
IT-push innovation tends to lead to farmore radical innova tion. Yet, because
of the uncertainty in outcomes,
it is often more difcult to obtain
funding for technology-push projects
and therefore many IT executives simply
ignore or minimise such efforts and
focus on supporting and aligning with
demand-pull requirements.
Our research led us to develop a
framework that maps IT push against
business-pull, highlighting the specic
issues and challenges that must be
grappled with when considering
business innovation with IT (see
Figure 1). This has proved to be a
powerful framework in our work
with executive teams; giving IT a more
innovative mandate and helping them
to understand the trade-offs that they
unknowingly make. The framework
also highlights four specic traps
that executives can fall into thathave profound implications for any
organisation seeking to promote an IT
innovation agenda.
On the push side are technologies
that are either known to the
organisation, or exist in the
market, but are as yet unknown
to it. On the pull side are
problems and opportunities
that are either dened or exist
but have not yet been identied
and thus remain undened.
Problems tend to be grounded
in the existing organisation and
its strategy. Opportunities mean
doing something different and new.
In the known-dened quadrant
are problems and opportunities
but with known solutions. The
known-undened quadrant
captures the situation where a new
technology is identied that may
have potential for the organisation.
This potential has yet to be
identied and dened and requires
investigation to seek out what
these might be.
The dened-unknown quadrant is
where a problem is highlighted and
a search is conducted to identify
potential technology solutions.
The bottom-right undened-unknown
quadrant represents the fact that there
are problems and opportunities that
have yet to be dened and that there
are technologies the organisation is
currently unaware of.
This simple framework can be used
by organisations to consider and
assess their current approaches to
business innovation with IT. A key
question to be addressed is whether
you have initiatives in all quadrants. The
framework also highlights a number
of traps that organisations can fall into
when looking to innovate with IT.
The complacency trap occurs
when organisations believe they
are innovating when in fact they are
applying a known technology to a
dened problem or opportunity.
The innovation might be new to
them but it is certainly not providing
any competitive differentiation. The
credibility trap occurs when a
technology with potential application
is identied and due to the poor
credibility of the IT department or lack
of appropriate business relationships,
it fails to gain any traction in the
business. The imitation trap arises
when the organisation simply
copies what others have done in
applying technology to a business
problem or opportunity. Finally,
organisations fall into the ignoranc
trap when they fail to acknowledg
that there are problems and
opportunities still to be dened an
technologies to be identied.
An organisation needs to operate
in all four quad rants, recognising
that not all their actions will
lead to competitive advantage.
Ultimately, all innovations end up
in the known-dened quadrant
as it is difcult to keep any
innovation secret for very long.
Your competitors are continually
watching your strategic moves, jus
as you are theirs. The challenge is
to ensure that your organisation
is operating in the other three
quadrants while simultaneously
avoiding the traps.
For further information contact the
author at [email protected]
MF
InformationTechnology
Push
Technologysearch
Solution to a knownbusiness problem
Defined
Known
Unknown
Undefined
Business Problem / Opportunity
Pull
Opportunities search
Missed opportunities
Complacency Trap
Imitation Trap
Credibility Trap
Ignorance Trap
Figure 1
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by Dr Emma ParryPrincipal Research Fellow
Organization Studies
and David BuchananProessor o Organizational Behaviour
he constant ow of g
policy initiatives, pres
targets and high pro
about patient safety and ward
have combined to make the N
Service (NHS) a complicated a
environment in which to work
Although they are responsible job of managing the delivery of
and often get the blame when
wrong, surprisingly little is know
the work and experiences of fr
middle managers in the NHS.
T
ReleasingTime toManage
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Despite the myriad o waysthat they can contribute toorganizational outcomes, weknow that NHS managers areundervalued, overstretched andoten underutilized.
It is against this backdrop that a team
of researchers at Craneld School of
Management have embarked on an
extensive project to investigate the
roles, contributions and realities of
front-line and middle NHS managers.
Funded by the Service Delivery and
Organization (SDO) programme,
the project is using a combination of
interviews, focus groups, and a survey of
managers in six NHS Trusts to explore
what front line and middle managers
contribute to patient outcomes, what
motivates them and the barriers they
experience when trying to perform
their jobs. This article looks at some of
the early ndings from the project.
We know that middle and front line
managers in acute settings within the
NHS are highly motivated, particularly
when it comes to making a difference
for patients. We asked midd le and
front line managers what motivates
them to do their job and found a lot of
commonality in their answers.
Managers said they were motivated
by the desire to make a difference for
patients and to provide a high quality
service. However, they want to feel valued
and receive recognition and feedback
for the work they do. Some managers
enjoy developing others, supporting their
colleagues and working in a team, while
others emphasize self-development.
There was also evidence of public
sector values. Some of our participants
mentioned factors such as pay, job security
and terms and conditions; but these were
not the primary motivations for working
within the NHS. The managers that we
spoke to were enthusiastic about the buzz
of innovation and trying new things.
The popular stereotype of NHS
managers is as costly administrators and
bureaucrats who block change. Yet our
research shows that middle and front line
managers in the NHS are fundamental to
implementing service improvements and
other organizational changes that make a
real difference to patients.
Third, managers told us that the
demands relating to compliance make
their jobs difcult as they constantly
have to service the regulators and
are under pressure to avoid breaches.
Fourth, managers reported that they
have a number of issues relating to the
systems and processes, such as dated
IT, information gaps, and are constantly
ghting systems that dont work. Fifth,
our interviewees spoke about difculties
with external relationships particularly
with primary care trusts. Sixth,
difculties are caused by the constant
demands for change coupled with the
slow rate of change. Finally, managers
experienced other issues around staff
shortages, recruitment problems and
learning from serious incidents.
This paints a picture of a problematic
environment with potentially more
barriers and blockages than facilitators
for middle and front line managers
trying to make a difference for patients
and to their organizations.
Managers told us that they felt like
hamsters on a wheel, that middle
and front line managers only ever get
beaten up and that it doesnt matter
what we do, it is never good e nough.
We can see then that the organizational
environment surrounding middle and
front line managers doesnt necessarily
support their contributions and that
they often lack the resources, authority,
external support and, in particular, the
time to be able to drive and implement
new ideas.
Middle and front line managers are not
always allowed to punch their weight
in terms of contributing to service
improvement and clinical outcomes.
Some simple cost-neutral steps would
enable them to make a greater impact.For instance, middle and frontline
managers should be empowered to
decide, within their budgets, how their
areas are run and be provided with
timely and understandable nancial
information. At a divisional level,
the clinical director and
manager make a powerfu
they collaborate effective
improvement events give
to reect, and to develop
approaches. More ofce
fewer meetings would als
Finally, at a personal level
front line managers shou
walk the oor and talk to
and not be driven by ema
should be allowed to cre
reection and for exchan
with colleagues.
For further information con
authors at emma.parry@c
or david.buchanan@cranf
MF
Our research revealed that they contribute
to clinical and organizational outcomes in
seven main ways (see Figure 1).
Despite the myriad of ways that they
can contribute to organizational
outcomes, we know that NHS managers
are undervalued, overstretched and
often underutilized. This experience
seems to be true across the Service
and is shared by middle and front line
managers regardless of their place in the
organizational hierarchy from ward
sisters to directorate managers.
Our research has identied seven
sets of barriers to middle and front
line managers performing their roles
effectively. The rst is money as the
pressure to cut costs and the increasingly
complex funding model often make it
difcult for managers to be effective.
Second is the work itself as issues
related to nding the time and headspace
to manage effectively and the need for
broad shoulders and a thick skin.
Figure 1:Seven ways in which NHS managers contribute to clinical and organizational outcomes
1. Identifying, selling and implementing
service improvement ideas and
opportunities.
2. Translating and implementing
ideas from colleagues and external
sources.
3. Facilitating change, taking risks,
working with clinicians, organizing
rapid improvement events.
4. Process and pathway redesign
such as the productive ward and
lean methods.
5. Developing infrastructure such
as new IT systems and physical
facilities.
6. Developing skills in others and
getting people on board.
7. Leveraging targets to improve
performance, through the
use of techniques such as
dashboards and benchmarking.
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The ability to work effectively in the Zone
of Uncomfortable Debate is a capability that
distinguishes effective management teams
from the rest. It may even be rare enough to
make such teams very special.
by Dr Catherine Bailey
Director
Cranfeld Business Leaders' Programme
ost senior managers nd
their executive team difcult.
Dysfunctional is a favourite
word. Testing dynamics, political
agendas, big personalities, strong
opinions (and voices to match), too
much or too little control is the reality
for many. Not surprisi ngly, they nd the
real work of the management team -
tackling the big strategic and business
performance issues - challenging at the
best of times.
But times have changed. The
unprecedented business challenges of
the recession have tested teams with
tough choices and urgent decisions.
Difcult decisions about what, where,
how, and how deep to cut for efciency
whilst sustaining capability in a radically
changed nancial environment.
M
Never has it been more necessary or management teams to be able to
work through the Zone o Uncomortable Debate (ZOUD) that unspoken
process that prevents us rom questioning too closely the things that are
held dear in business.
These issues now give way to even more
demanding questions about positioning in
the dynamic landscape of new and changing
customer preferences, dwindling markets
and outdated practices; but at the same
time booming opportunities and the high
gain, high risk potential of growth strategies.
At no time in the recent past have business
teams needed to be more able to address
the basics, to challenge themselves to
identify their business core capability, yet
at the same time take swift and decisive
action. Never has it been more necessary
for management teams to be able to work
through the Zone of Uncomfortable
Debate (ZOUD) - that unspoken process
that prevents us from questioning too
closely the things that are held dear in
business. Such discussions all too easily
dissolve into hostility, power plays, ridicule,
escape mechanisms or delay tactics.
Seventy senior managers from fteen
executive teams attending Cranelds
High Performance Business Team
programme shared their experiences of
the ZOUD. What prevents productive
discussion on difcult issues and how
can managers handle vital but tricky
business decisions? Here are some of
their collective insights on what gets in
the way:
Insufcient knowledge of others
agendas and views
Others inability to discuss difcult issues
Fear of uncontrolled emotions
Assuming you need the answer to ask
the question
Prejudging the answer
Fear of surprises
Lacking condence in a productive
outcome.
ZOUDWorkingthrough
the
How to work through the ZOUD
1. Prepare people, process and place
Give people the opportunity to prepare; rotate
the Chair; legitimise and spread the responsibility
for asking challenging questions by taking turns
to be devils advocate; ensure sufcient agenda
time; choose a comfortable or different location
for ZOUD discussions.
2. Make ZOUD discussions an executive
team competence
Be clear why it is important for the team to
talk about ZOUD issues; recognise the natural
difculties that everyone experiences; agree
rules of engagement.
3. Find the right starting point and pace
or too difcult issues by taking a
stepwise approachIs there agreement there is an issue to discuss?
What is the issue? What are the decisions to be
taken? What needs to be understood better to
make those decisions? What are the decision-
making options? What are the pros and cons
of each? What factors should guide choice and
what weight should they have?
4. Maintain a productive perspective
Keep a business (not personal) focus; and keep a
long term and bigger picture perspective.
Focus on issues (not personalities) and ensure
everyone gets heard.
5. Act with emotional intelligence and
political awareness
Manage your own emotions; dont leave others
to guess your worthy intentions. Strive to
understand what is driving others' views. Ask
questions to gain understanding (rather than
trade dogmatic statements); facilitate progress
(e.g. how can we move on? What would help
us to clarify this? What are we trying to work
towards here?)
6. Leave the ZOUD beore leaving the room
Put the discussion and its value in perspective:why
it was important;the natural difculty felt;what s
been achieved by all and agree the next steps.
For urther inormation contact the author
MF
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by SanSenio
Business E
S P R I N G 2 0 11 MF6 MF
Managing
the Price FoodRising ood prices are a direct consequence o the global ood supply
keep pace with demand. The world needs a new green revolution wit
advances that can deliver higher yields and improved management pra
run large-scale hi-tech arms eectively.
of
8/7/2019 Management Focus Issue 30
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Issues Concerns Challenges
Demand drivers
1. Substantial rise in the
worlds population
Annual global per capita grain
production has declined
Many developing countries
are struggling to meet their
populations demand for food
2. Nutrition transition as
per capita incomes rise
Global demand for meat and
dairy products rapidly rising
Continue upward pressure on
world food and grain prices
Supply challenges
3.The dependency of foodproduction on energy
Energy prices have risen andare expected to rise further
Rising production costs plusincreasing diversion of arable
land from food to biofuels
4. Severe limits on the area
of agricultural land
The per capita area of
cultivated agricultural land has
declined
Underlying productivity
growth particularly for grains
is slowing
5. Global supply of water
failing to match demand
Agriculture production heavily
dependent on fresh water
Agricultural trade to
compensate limited by failure
to reach WTO agreement
6. Stress of climate
change on agriculturalproduction
Identied as a cause of crop
losses in recent years
Will contribute to the more
rapid spread of crop andanimal disease
7. Rural populations
are declining as a
proportion
Global harvests already
dependent on migrant labour
Rising urban populations will
become reliant on a reduced
rural population for their food
As per capita incomes rise above
$2 a day, diets include more meat and
dairy products. The FAO expects
demand for meat in developing countries
to more than double by 2050 and this
will require a complementary increase in
the production of grain for animal feeds.
The situation outlined in Figure 2
is echoed in a 2009 study from the
Royal Society which argued that only
solutions underpinned by science and
technology are feasible. In essence,
the challenge is to greatly increase total
factor product ivity. That is, not only will
farmers have to signicantly increase the
output they get from each hectare of
land; but they will also have to achieve
this by using less water and energy per
unit of output.
The world needs a new greenrevolution with scientic advances that
can deliver higher yielding plant and
animal varieties while reducing demands
on the worlds resources. However
reliance on technology and in particular
biotechnology will not be sufcient.
Figure 3 shows how the value
inherent in new scientic knowledge
can only be captured if managerial
ability keeps pace.
Never has an industry cried out
more loudly for creative destruction;
namely, the replacement of large
numbers of small scale, badly managed
enterprises with fewer, larger scale
skilfully managed farms. That there
are enormous economies of scale in
farming is beyond dispute and the wide
range of yields, quality and unit costs in
all agricultural sectors testies to the
scope for improved efciency. Large
scale enterprises can afford and justify
higher levels of investment; they can
more easily spread risk; and deliver the
lowest unit production costs.
With so much dependent onmanagement, it is pertinent to ask why
farming is a neglected area in business
schools? Three reasons come to
mind. F irstly, in developed nations
agricultural policy is implicitly viewed
as a social policy.
High levels of support ha
of overriding market forc
protecting inefcient ent
critics soon nd they are
with politics rather than
Secondly, in the worlds
countries there are very
for farmers who would n
the land to make way fo
farms. Anyone advancing
structural change is at be
viewed as heartless. Thir
lacks the glamour of tran
organisations and higher
diversied products.
This neglect is a serious
Feeding the world is the
priority and the growing
for food will require muc
management skills in agr
is where business schoolimportant rol e to play. W
to offer in helping the wo
system adapt to this new
For urther inormation co
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
200
180
160
140
120
220
100
NewScientific
Knowledge
TechnologyCaptured
investment incapital, new prosystems and re
managerial c
Added value larger scale ophigher produc
superior sta
Delivering a wide choice of low cost food andnon-food products via sustainable production
systems and supply chain collaborations
Biotechnology
Management
Figure 1: FAO Food Price Index
Figure 2: Seven challenges to global ood production
Source: UNs Food and Agriculture Organisation (FAO)
Source: Authors summary based on Chatham House report Food Futures:Rethinking UK Strategy
ood price ination in the
UK is currently 5%, just two
years on from peaking at
12.8%. The UNs Food and Agriculture
Organisations (FAO) benchmark
food price index (see Figure 1)
suggests 2007 was an indication of an
upward shift in global food prices and
the UNs Millennium Development
Goal to halve the proportion of
hungry people in the worlds poorest
countries by 2015 has suffered the
embarrassment of numbers continuing
to rise. These are not random events
- they reect a fundamental change
in global food markets. After a
generation in which the affordability of
food steadily improved, the trend has
now been reversed.
A recent report by Chatham House
(the Royal Institution of International
Affairs) on the future of food, opens
with the words: What we had
thought of as abundant food supply
is anything but the global system
as currently operated will reach
breaking point unless action is taken.
Higher food prices are a direct
consequence of global food supply
failing to keep pace with demand.
In developed countries this puts
stress on disposable incomes with
adverse effects for other sectors of
the economy. In developing countries
it threatens the pace of development
and in the worlds poorest countries
it results in hunger and malnutrition.
The challenges faced by the worlds
food system are summarised in
Figure 2. Many food experts believe
that the global demand for food willdouble over the next 40 years due
partly to the worlds population
rising to 9.2 billion; but primarily
because of rapid economic
development and its associated
reduction in poverty.
F The index weights the averagewholesale price of wheat, corn, rice,
oilseeds, dairy products and meat.
Figure 3: The importance o management
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A
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consumption levels
in these countries will
rise, causing a decline in
savings. This is likely to
cause further reductionin the availability of capital.
Finally, higher nancing costs will
reduce stock market valuations
thereby adversely affecting stock market
performance. These developments will
create serious managerial challenges in
the developed world. Businesses will
have to become smarter and more
innovative. The likely shortages in
availability of capital would mean that
managers will have to invest scarce
capital a lot more judiciously. Good
banking relationships will be a critical
success factor for gaining competitive
advantage as access to nance will
become increasingly difcult.
Technological innova tions
which have provided
competitive advantage in
the past will be another
key factor to remaining
competitive in the wake of
increased competition
from the emerging
economies.
For further information
contact the author at
s we enter a new decade, there
are a number of uncertainties
about the current status and
long term prospects of the global economy.
The International Monetary Fund (IMF)
estimates that the rate of growth in Europe
has been sluggish and the outlook for the
worlds largest economy, the US, remains
uncertain. The current and future state of
the global economy is largely attributed to
the credit crisis that ensued following the
sub-prime mortgage debacle in the US.
The toxic credit crisis then spread across
the Atlantic and now threatens the future
of the Euro. Europe, Greece and Ireland
are being helped through nancial packages
and there is concern that the market
pressure may also create a liquidity crisis
for Portugal and Spain. However, one must
question whether it is right to treat the
nancial crisis which has affected the
major developed western economies as
a global crisis.
MF
Although the nancial markets in the
emerging economies of China and India did
react to the adverse developments in the
US and Europe, these reactions were short-
lived. Both economies continue to grow at
their long term growth projections.
It is estimated that whilst Chinas GDP
will continue to grow by around 9%,
India will not be far behind with around
7.5% annual rate of growth for the
foreseeable future. In a recent study,
PricewaterhouseCoopers suggests that
the global nancial crisis has accelerated
the shift in economic power from the
developed to the developing economies.
If they continue to grow, the economic
output of the emerging markets of China,
India, Brazil, Russia, Mexico, Indonesia and
Turkey, the so-called E7, would overtake
that of the established G7 nations: US,
Japan, Germany, UK, France, Italy and
Canada by 2032.
These developments have major
implications for developed economies like
the UK. It is estimated that the UK exports
around 7% of its total exports to developing
economies. As the economic power shifts
to the emerging economies, unless the UK
increases its share of exports to developing
countries it will miss the opportunity
to be part of the growth. On the other
hand there are serious challenges for the
government and policy makers in emerging
economies. The higher rates of growth
coupled with higher rates of interest in
emerging economies, are already attracting
hot capital ows. This is putting upward
pressure on their currencies. Over the last
two years or so, most of the currencies of
developing countries have increased in value
signicantly against the US dollar. Brazil
provides a good case, where the Brazilian
Real has risen by nearly 40% against the
US dollar prompting the government to
actively intervene in the currency markets.
The Brazilian banks have been directed
to hold higher reserves against their
foreign exchange positions and
the tax rate on income earned
by foreign investors from Real
denominated bonds has been
doubled to 4%. Excessive liquidity
created by quantitative easing
pursued by developed economies
including the US and the UK has led
to spiralling commodity prices. Ination
rates in emerging economies have
increased and a steep increase in food
prices is posing a serious threat to policy
challenges and economic gains.
The nancial crisis has exposed the
hazards of excessive dependence on debt.
The credit crisis has provided signicant
insights into the short-sighted businesspractices of the nancial services industry
in general and the banking sector in
particular. Banks which generously
offered credit to nancial markets
and the corporate sector, have now
become highly risk averse. Furthermore,
the emerging economies of India and
China require huge investments in
water systems, transport, infrastructure,
housing and power generation. These
economies do not have high levels of
capital accumulation and therefore to
nance the growth, capital from other
parts of the world must ow to emerging
economies. These developments bring
signicant implications for businesses
in the developed economies. First
and foremost, availability of capital in
developed economies will be scarcer
as it will be directed to the growing
emerging economies. Consequently,
less supply of capital will lead to higher
costs and access to credit will be
increasingly challenging. Secondly, high
saving developing economies have been
an important source of capital for the
developed world for many decades.
However as these economies grow
and the standard of living improves,
GlobalPower
ShiftThe global fnancial crisis has accelerated theshit in economic power rom the developed
to the developing economies.
by Sunil PoshakwaleProessor o International Finance
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by Dr Liz Lee-KelleySenior Lecturer
Programme and Project Management
ProjectManagers:
Lessons Learned?
roject management has shifted
from its traditional base in
industries such as aerospace,
engineering and construction to
become a core process across a variety
of sectors such as transport, IT and
pharmaceuticals. Companies that are
struggling to stay competitive, especially
in these difcult times, are turning
to project managements task-based
approach of getting things done
on-time and on budget. For many,
projects are now part of everyday
business life and most people will nd
themselves managing a project or
being part of a project team at some
point in their working life. The terms
project and programme have become
associated with company initiatives
of varying complexities ranging from
moving ofce to marketing the launch of
a new generation of products.
In the public sector, policy
implementation and the acquisition
and management of equipment and
services are managed as projects and
programmes. Yet year after year, the
National Audit Ofce (NAO) and Public
Accounts Committee, report huge
overruns in time and cost, bringing into
question not only project governance
but the governments ability to deliver
value for money. The media have
been quick to publicise the failure of
high prole projects such as the NHS
programme to digitise patient records.
Reported as one of the largest IT
programmes in the world at 6.2bn,
it was criticised for the lack of
stakeholder involvement and for being
severely delayed and overspent.
The failure of the Child Support
Agencys (CSA) new IT system, CS2,
was another highly publicised asco. It
launched in 2006 despite having known
critical defects. Three years later, the
NAO found more than 1,000 reported
problems, 400 of which appeared
insoluble. Vertex Data Science
Limited was recruited to try and
reduce the ba cklog of case s. The Work
and Pensions Committee estimated
the cost of managing the clerical cases
alone to be around 3.7m per month.
In both these cases, failure can be
attributed to a lack of transparency
and accountability, poor planning,
inadequate management information
and a breakdown in communication
with key contractors.
Projects and programmes are now
commonplace in both the private and
public sector. Large, more established
project-based organisations will
adopt methodologies that are aligned
with one of the professional bodies.
For government projects, specic
procedures or frameworks are
provided by the relevant government
agency or the Ofce of Government
Commerce. Many will also operate
their own centre of excellence
or academy to deliver project
management training and develop
their project staff.
The processes used in a
only one of a host of inte
external stresses and dem
project managers and the
to cope with. Closer exa
the problems that the N
CSA faced, reveals that p
context, structure, techn
stakeholder relational dy
economics, politics and e
all have a role in the proj
seems 21st century proje
is about the capacity for
performance in a messy,
uncertain world.
An observation from our
with professional institut
and public sector sponso
appreciation of the need
holistic approach to proje
and soft sides of project
are essentially two-sides
has been a notable shift i
accept that project mana
capability encompasses m
how to do projects. Effec
will have developed the c
ability to fathom and pro
the unintended conseque
accompany every decisio
new generation of manag
trained and supported, n
with people and processe
management may nally b
a profession.
For urther inormation con
P
MF
S P R I N G 2 0 11 MF2 MF
Companies that are struggling to stay competitive, especially
in these difcult times, are turning to project managements
task-based approach o getting things done on-time and
on budget.
8/7/2019 Management Focus Issue 30
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he nancial crisis has
left many countries with
signicant national debt and
consequently public sector budgets are
under pressure. This is having a major
impact on the ability of governments
to deliver public services and so
governments are facing the question:
how can the availability and quality of
public services be maintained at the
same time as saving costs? Innovation
can play a key role in addressing this
question and this article focuses on
a particular form of innovation - new
partnerships between the public sectorand commercial organisations, which
we term commercialisation.
This article discusses how such
partnerships can be stimulated, and
the barriers that must be overcome to
achieve commercialisation.
T
Innovation is something that many governments strive to
support, in both the private and public sectors. By bridging
the two sectors and creating novel partnerships, public
sector expenditure can be reduced.
An important issue is the nature of
innovation in public sector organisations,
as this is often misunderstood. The
denition of innovation most frequently
used by the UK government is the
successful exploitation of new ideas,
but this is too generic to support
public sector organisations that want
to innovate. More clarity is needed.
There are of course different levels
of innovation, from incremental
(changes to existing services) to radical
(creating new services or completely
new ways of delivering services), and
transformational (innovation whichcompletely changes the way the system
works). Much of the innovation in the
UK public sector is incremental, for
example the improvement of service
delivery, or the reduction of costs
through outsourcing.
However, although incremental innovation
is important, it will be more radical
innovations that are needed to ease the
pressure on public sector budgets. Until
now, partnerships with the private sector
have mainly been based on nancial
initiatives but commercialisation opens up
new opportunities.
Commercialisation is different in that
it looks to combine the capabilities of
public and private partners in a unique
way that enables the generation of new
services (which neither partner could
develop alone), and in a way that therevenues are shared (allowing a nancial
advantage for the public sector). In our
research we have looked in detail at
how such successful partnerships arose
and the new services that resulted
(see Figure 1).
InnovateCollaborateto
In 2001 the Met Ofce started developing
a method to predict the level of demand
for healthcare, based on weather
conditions (for example, cold weather
makes certain respiratory conditions
much worse). A free-of-charge service
for hospital emergency departments was
launched that helped them predict the
changes in demand for their services.
However, when government funding ran
out and hospitals were asked to pay for the
service, the vast majority stopped using it.
A chance meeting at a 2006 conference
led to the Met Ofce starting discussions
with Medixine, a small Finnish tele-health
company. Working together, they created
an automated telephone system that
alerts at-risk patients of upcoming adverse
weather conditions, asks if they have
adequate medication, and advises them to
wrap up warm and stay indoors.
This service has proved a big success,
with around 40,000 patients now signed
up. Medixine market the service and
gain revenue for every patient they sign
up, which is shared with the Met Ofce.
In addition, the NHS benets from a
signicant reduction in costly hospital
admissions. The service demonstrates
that both public sector and
commercial partners can benet
from commercialisation.
Figure 1 - Met Ofce case studyby Keith Gofn
Professor of Innovation and New Product Development
Dr David BaxterSenior Research Fellow in Innovation
Dr Magnus SchoemanVisiting Fellow
Commercialisation holds
a number of projects, like
Ofce example, have sho
relationships with comm
can lead to signicant and
revenues. However, there
barriers to successful imp
To investigate these we c
a survey of UK civil serva
results showed that com
partnerships are perceive
servants to be of growing
However, the respondent
survey also perceived tha
conicts of interest, low
and a lack of experience
such relationships were h
public sector. In particular
that there was not enoug
available to public sector
how to make commercia
Innovation is something t
governments strive to su
both the private and publ
bridging the two sectors
novel partnerships, public
expenditure can be reduc
offers a real alternative to
public assets. It will rema
whether the government
most of this opportunity.
For urther inormation co
authors at k.gofn@cran
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Howard Dickel, BTs Delivery Programme Director or London 2012, who
completed the Executive MSc in Programme and Project Management
at Cranfeld talks about how BT will deliver the world's largest sporting
event around the globe.
Alumni interview:Howard Dickel (MSc PPM 2010)
by Stephen Hoare
OlympicChallenge
icture the scene. It is the 2012 Olympic Games, a British athlete
is leading the feld in the mens 100 metre sprint. It is a dramaticmoment. Suddenly your TV screen goes blank as broadcasts around
the world lose sound and pictures. By the time normal service is
restored the race is over and you and millions o others will have
missed a historic moment when a world record has been smashed.
The scenario is BTs Delivery Programme Director or London
2012, Howard Dickels worst nightmare. He stresses: There is no
project more important to BT. In terms o the sheer visibility, political
importance and reputational damage to the brand i we get it wrong.
PAn
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Combining internet protocol
telephony, with high speed bre
optic packet switching and wireless
networks, BTs communications
services are not necessarily
state-of-the-art, but use tried and
tried technology where reliability is
key. BTs remit is to provide xed and
mobile phone communications and
sound and pictures to and from the
main Olympic Park in London and 94
related venues across the UK.
Responsibility for ensuring
communications is aligned to clients
needs rests on Howards shoulders.
He and his team consult fully with
client representatives and with
technology partners like Atos
Origin, Omega, Cisco, Panasonic
and Acer before the technicalspecications are drawn up and
commissioning begins.
From April 2011until the start of the
Games in 2012,BT will be conducting
a series of dry runs to check systems.
In charge of stakeholder
relationships for BTs London 2012
delivery programme, Howard must
liaise closely with the London
Organising Committee of the
Olympic Games and Paralympic
Games (LOCOG), its chairman
Lord Coe, all venues for the Games,
international sports bodies and
the worlds press and broadcast
media. BT is tasked with installing
and operating the broadband and
wireless communications needed
to bring the Games to an estimated
5 billion viewers and listeners
around the world.
Well before London was chosen
to host the 2012 Games, BT was a
partner in the bidding process. BTs
technical capability was a crucial
factor underpinning Londons
bid and is a source of national
pride for BT and its staff. It was
unthinkable we would have the
Games without BT being involved.
As the Games ofcial
communications services partner,
BTs involvement has clearly dened
stages. Howard explains: We
will move through the design to
delivery phase to the operational
phase and then a close-down phase.
As BT gears up for the opening of
the Games on 27 July 2012, 800 BT
staff who Howard refers to as the
Squad will be temporarily assigned
to manage communications services
for the1
7 days of Olympic and12
days of Paralympic sporting events.
This includes the appointment of
112 venue telecoms managers.
The high visibility role is expected
to propel peoples careers like
athletes from the starting blocks.
The test events, some held in private,
some high prole, like the three
day gymnastics contest at which 15
countries will participate at the O2
Arena in January 2012, may expose
technical glitches which can then
be xed ahead of time. The 100
metre race takes just over nine
seconds. A three second outage right
in the middle of the race would be
unthinkable. Our operation is mission
critical in every respect, says Howard.
Following an exhaustive risk
assessment, BT has installed resilient
high speed broadband cables to
serve the Olympic Park, each routed
independently around London. There
is also back-up services within the
venues themselves.
Appointed in 2008 specically to play
a key role in the Olympic delivery
programme, Howard was sent by his
employers to study the behind-the-
scenes technology at the Beijing Games
and the Vancouver Winter Olympics.
BT has tried hard to draw on the
accumulated wisdom from companies
involved in previous Games. They
sponsored Howard through
Cranelds part-time executive
MSc in programme and project
management. He says: Theres a
huge amount of pride within BT and
a determination to get things right. I
thoroughly enjoyed the three years I
spent at Craneld and I did my thesis
on the transfer of knowledge from
one Olympic Games to the next.
From his ofce on the 37th oor of
a Canary Wharf ofce block, Howard
points out of the window at an
adjacent high rise building: Thats
Lord Coes ofce. LOCOG have
got three sets of ofces all within
a few minutes walk. Face to facemeetings are the best way of getting
things done.
Howard takes the pressures of the
job in his stride and says half jokingly:
I have everyone from the CEO
downwards marking my homework
on a regular basis. Performance
management involves quarterly
review meetings with BTs chief
nance ofcer, regular meetings with
operational management as well as six
monthly audits.
So what management lessons can be
learned from Howards leadership
experience? In charge of a business
unit focusing on client delivery, he
manages a current team of150
with a dozen direct reports. It is a
level of leadership akin to running a
medium sized company and it is the
entrepreneurial nature of the job that
Howard loves the most:
There are few roles where you
have such a connection with the
customer. It keeps you focused onthe real world.
Howard is at heart a programme
manager whose skill is in delivering
many intertwined projects all coming
together at once.
He does not profess t
technical or technolog
He makes his expecta
clear: Ive hand picked
my team especially the
management roles. I h
deliberately avoided a
structure. If there is so
the relevant knowledg
below me, I let them l
particular situation.
Howard says he can app
at times: Its not such a
show a bit of passion. H
never been involved in a
there has been such a d
emotional connection w
Many of them tell me th
interesting project theyv
on. You just cant put a pkind of commitment.
Ive never been involved in a project where there
has been such a direct and emotional connection with t
people. Many of them tell me this is the most interesting
project theyve ever worked on. You just cant put a pric
that kind of commitment.
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