Cracking Cross-Team Collaboration

As Managing Director of Strategic Development for the UK & Ireland at Experian, Steve Thomas has done a lot of work integrating a company that’s acquired 200 businesses over the last 15 years. Yet he was acutely aware that the structure they were brought into was not compatible with long-term success.

“We weren’t able to project growth from the divisions at the desired revenue,” he explains. “The four top opportunities across the group were cross-divisional. It was clear we had to work differently to achieve our ambitions.”

As with many businesses adapting to modern challenges, agile and collaborative working offered solutions, so Steve pooled some of his best talent into a cross-functional team. But in his efforts to change the business, he was struck with how to balance resources.

“The innovation team never suffered from capex or opex availability, but from resources. The people essential to the project were needed in other areas of the business so they didn’t dedicate enough time to it,” he explains.

Steve goes on to relate how the existing operations were also put under strain to perform at the same standards, yet with less means. “With leaders giving up people to the project, they felt they didn’t have the resources to do what they’d committed to, making meeting revenue targets more challenging,” he says.

Redefine the tribe

Gary Browning, NED and former CEO of Penna shares similar experiences. “I inherited a company that in 2006 was very siloed and almost set up to be internally competitive,” he reveals. “It was really difficult to get people to work together across divisions for the benefit of the client. We had people asking why they should allow their top person to go off and work on something that didn’t count towards their own results. It took a couple of years and huge amounts of investment to break down that mindset.”

Gary describes how the company had to “redefine the tribe”, encouraging people not to see themselves as a member of one of its divisions but of the whole company.

“Interestingly, we had more resistance the further up the organisation we went. The younger, more junior staff had a real desire to be part of the one tribe, but as you went up to middle managers, seniors managers and MDs, they wanted to keep ownership of their people, P&L and clients – that’s where we had to do the most work,” he explains.

Progress was made by creating a system that rewarded collaborative behaviour. “Previous management’s view was that to achieve collaboration, you should remove all measurements from a local level. They took out local P&L and had just the one measuring a £100 million business with no local KPIs. That may sound like a solution to breaking down silos, but it caused a huge problem in the business because we completely lost accountability. I put those measurements back in again, but it was into an environment where people already wanted to collaborate,” Gary explains.

“We did that in a number of ways: hard bonuses, soft rewards and spot bonuses. We launched an employee of the month scheme, but the only way you could be nominated was through behaviour, not sales. We promoted and recruited for behaviours and set KPIs for them. But we never totally cracked it – it’s incredibly difficult.”

Win over your divisional leaders

While Roger Edwards, Managing Director of the Municipal Division at Biffa, embraces the collaborative approach his company is taking, he is able to shed light on the impact cross-functional teams have on divisional MDs. Biffa’s lead agile team is working on a project that will transition customers to a digital platform, but it’s also applying a lower-burning collaborative ethos to ‘business as usual’.

“Having just successfully listed on the stock market it’ll be crucial to act for the greater good, because ultimately we’ll be judged on share price and not on divisional success. We need to create the mindset that it’s the company first and division second,” he explains.

However, being a divisional MD himself, Roger sees the challenges at a local level, in particular not knowing how long your team members will be gone if reassigned, how to hit the numbers without them, or whether to hire replacement resources in their absence.

So how can a company support its divisional heads? “If I let someone go for the benefit of the business, I want to know that it really was of benefit,” says Roger. “Communication on the milestones and success of the project are needed so that people can understand and support it.”

Communicate the rationale

Cross-functional teams can be a way to test and promote staff in areas they have the most potential, but you must be clear on what you’re trying to achieve and why.

“Most people fear change and won’t want to go into the unknown without reassurances,” says Charlie Wagstaff, Managing Director at Criticaleye. “Communication is always central to that, but you must also create an environment in which team members really feel they are better off for the work they are doing. That means finding what people are good at and growing them in the area of the business most suitable to them.”

Carol Peckham, Vice President of HR Transformation for the UK & Ireland at DHL Supply Chain, also argues for clarity on the responsibilities of those people. “For me, you have to understand where the critical talent pool is so you can use it on priority projects, rather than always asking colleagues to do things on top of their day job, which tends to be the norm in a lot of organisations,” she says.

“We’ve been looking at cross-divisional talent sponsorship so we’re talking very honestly about what each individual needs to do to develop their own careers across DHL. We’re also recognising people who proactively move colleagues around the organisation.”

It’s a slow process at DHL, where leaders have taken a gentle approach to agile working due to concerns about resistance. “There are more ideas coming through and we are only at the beginning. Ultimately, there is a fine balance that needs to be addressed. This type of approach requires agility and the right behaviours to adapt at speed, but at the same time you need to bring colleagues with you and allow them to see the benefits of working across divisions,” Carol explains.

These insights were shared during Criticaleye’s recent event, How to Bust Organisational Silos.

By Mary-Anne Baldwin, Editor, Corporate

Do you have a story you’d like to share on cross-functional working or agile teams? If so, please email maryanne@criticaleye.com

Don’t miss our next Community Update, which provides practical ways to improve diversity.

Advertisements

The Future of the Workplace

Comm update_10 September1

Ideas on what constitutes a fulfilling and productive working environment are shifting rapidly. They’re raising questions about mobility of talent and what it means to be an effective leader as the way in which knowledge is transferred, both within and outside an organisation, becomes more dynamic. Indeed, a perfect storm of new technology, globalisation and changing demographics is blowing away assumptions about how we work.

Lynda Gratton, Criticaleye Thought Leader and Professor of Management Practice at London Business School, suggests that the formal link between ‘work’ and ‘place’ is beginning to soften: “We are already seeing the rise of flexible and remote working arrangements as well as creative hubs where people use workspace as and when they need to.

“It seems to me that as working lives become more of a marathon than a sprint, we are going to see more emphasis on work that excites and inspires people and helps them to grow…These concepts are not just about employee well-being, they are… crucial to the competitive advantage of a company.”

It’s incumbent on leadership teams to get a grip on what is already underway. Stuart Steele, Partner for Human Capital Consulting at professional services firm EY, comments: “There is always competition for good talent and an inability to predict what the work environment will look like in three or four years’ time, I think, can put an organisation at a disadvantage.”

Let’s get digital

From the mills and factories of the industrial revolution to assembly-line car production at the turn of the 20th century, technology has reshaped working practices by reinventing notions of efficiency and productivity.

John Lewis, Chief Operating Officer for communication services provider Airwave Solutions, says: “Mobile working or process improvements are absolutely there for the taking. There are lots of different examples that I’ve seen, such as the creation of collaboration zones and the use of tools for collaborative working.”

How best to take full advantage of this flexibility is open to debate. Susanna Dinnage, EVP and MD for Discovery Networks UK & Ireland, explains: “A great deal of people working on their own, possibly at home, may benefit individuals in terms of family commitments and reduced time spent travelling… I understand that, we have busy lives… but what you lose is the alchemy of teams working together.”

John notes that organisations must be careful not to underestimate peoples’ appetite for interaction. “That can be the biggest challenge,” he comments. “How do you get over the fact that people just sometimes need to spend a bit of time gossiping or just having a reaction with others in their team to help process what’s going on?”

The hierarchy that traditionally existed in organisations is being broken down by the volume of information now available at employees’ fingertips. This is causing leaders to rethink how they engage with employees, encourage collaboration and make decisions.
Julian Birkinshaw, Criticaleye Thought Leader and Professor of Strategy and Entrepreneurship at London Business School, says: “Think back to the traditional role of the leader. Back in the industrial era, he was responsible for squeezing as much value out of his resources – money, people – as possible.

“In the knowledge era, he or she has become used to being an expert… They were also the conduit of information, the person who accesses and then disseminates information across the organisation. But if this information is now widely available, and if there are experts at all levels, the leader of the future has to think about what their value-added role is.”

According to Julian, leadership in this context will entail a more interpersonal role, helping other people to make decisions and avoid becoming overwhelmed by the volume of data available: “Good leadership… [will] be action-oriented; that is, following through with people to ensure they deliver on their commitments. One of the risks of ubiquitous information is that it causes analysis paralysis – there is always an opportunity to collect more.”

Melting pot

A more age-diverse workforce will certainly throw up some new challenges. Susanna says: “I am observing a new generation that is very smart. I look at our interns – they are engaged, they have plans and they have expectations. They don’t come here to stuff envelopes.

“They are not afraid to ask for half an hour in your diary to understand how you got your job – that’s fantastic. I love this confidence they have… [as] they step forward and… are contributing.”

There is a sense that the expectations held by millennials in the workplace are, in some respects, higher than of generations gone by. Stuart explains: “There have always been career-focused individuals, with an appetite for rapid progression, however, looking at groups, if you’re 25, your aspirations for broad opportunity and rapid progression in an organisation are typically a lot greater than what a 50-year old person’s was when they were that age.

“Where an older employee may have taken 20 years to progress three-quarters of the way up the organisation, the 25-year old wants to get to that same position in five years or less. How do you balance that? How do you meet their aspirations of rapid progression while not disenfranchising this person, who has delivered good service for the last 20 or so years?”

These are the types of questions which senior leadership teams need to be thinking about and addressing. Stuart adds: “As organisations’ demands for skills and capability change over time, the intrinsic value of the employees with 20 or so years of experience – those with real depth and breadth – changes from a position where one could arguably describe them as a commodity, to a situation where they have become ‘key retains’ focused both on delivery and the development of our younger workforce.”

It calls for a closer awareness of how to bring the best out of a diverse mix of talent. Lynda comments: “It’s clear that encouraging different age groups to work productively and harmoniously with each other can be tough. Those who have made it work often put job design and collaboration at the centre.

“Those that design jobs in an inflexible, linear way have found that they cannot be responsive to a person’s life stage and aspirations…. Right now, companies are struggling with this inflexibility – for example, not knowing how to handle mid-career hires because their processes are all geared towards hiring graduates.”

A multigenerational workforce will require organisations to consider different career paths and job designs simultaneously, rather than opt for a cookie-cutter approach. Specialisation, limited contracts and partnerships are expected to become the norm.

Julian comments: “The workplace of the future I would like to see is one in which people are given a lot of freedom to pursue the work that interests them, with a lot more bottom-up accountability, and far fewer formal bureaucratic systems for co-ordinating our activities. This is the model we see in many start-up companies, but once they go above 100 people or so they often lose this vitality.”

The impact of what is happening in the workplace will be genuinely game-changing and that’s why it’s something boards must take the time to try and understand. Unless they’re thinking about what it means for an organisation’s future, they won’t be able to turn what’s occurring into a tangible competitive advantage.

I hope to see you soon.

Matthew

www.twitter.com/criticaleyeuk

What Innovation Really Means

Comm update_28MayNew ideas and fresh thinking are fundamental if companies are to retain a competitive edge. To drive innovation, you need to create a culture where ideas come from both within an organisation and by working with others. Increasingly, the art of doing this successfully lies in being able to utilise various channels and by harnessing the skills at a company’s disposal to capture those moments of inspiration.

It’s crucial that, when it comes to innovation, employees don’t fear failure. Anand Gupta, Principle Innovation Evangelist for Europe at business solutions company TCS (Tata Consultancy Services), says: “We have an annual competition across the group… all companies are required to submit entries under broad categories such as, ‘Promising Innovation’, ‘ Leading Edge’ and ‘Dare to Try’.

“The ‘Dare to Try’ category is interesting because it rewards people who try to make something completely new work in the business that actually turns out to be a total disaster. But unless we encourage people to try they’ll always be scared. We want them to go beyond this fear and decide if the idea is worth it. It cannot be a wild decision, it needs to be valid within the environment… but then, if they fail, that’s perfectly OK.”

Jane Griffiths, Company Group Chairman for EMEA at Janssen, the pharmaceutical division of Johnson & Johnson, comments: “We’ve had projects going on recently where some have worked and some actually haven’t done so well; I think you have to make sure heads don’t roll as a result of attempts at innovation that don’t work out, because if you come down heavily on people who try to innovate… that stops other people from trying new things.”

There has to be consistency. Costas Markides, Criticaleye Thought Leader and Professor of Strategy and Entrepreneurship at London Business School, questions how many corporates actually get this right: “Companies ask people for certain behaviours to promote innovation, but in reality they have an environment or incentive system in place that does not encourage those things.”

If employees are to believe they have a licence to think differently, then executives have to lead by example. Costas continues: “[When] the leadership of an organisation begins questioning; going outside their industry for ideas and starts experimenting… once they start behaving in the way they want everybody else to behave, pretty soon everybody else in the organisation will follow suit. That’s how you create a culture of innovation.”

Cath Keers, Non-executive Director of Home Retail Group, says: “There has to be a brave, passionate and determined leadership to really take those risks on innovation. Encouraging cross-functional teams, who share, collaborate and adopt the ‘have-a-go’ mentality with a clear view of what success looks like, is essential.”

Once the ecosystem is right ideas will, in theory, be able to flow through an organisation far more easily. Martin Hess, Vice President of Enterprise Services at IT company Hewlett Packard, comments: “Most innovation in business comes from being close to the customer, [it] doesn’t start at head office. Try and keep an organisation as flat as possible… so the ideas don’t get diffused and diluted as they go up through the company.”

Businesses need to remain agile and if new ideas are to come through, it may be necessary to develop them in isolation to the core business. Mark Wood, SVP and Managing Director of EMEA for US-based cosmetics firm Revlon, comments: “Our normal new product development pipeline may take two-and-a-half to three years to bring an idea from concept to getting it onto the shelf, because you’ve got lots of internal processes, checks and ‘stage gates’ that you need to go through.

“We acquired a business that was run on a completely different platform. It was all about bringing the latest catwalk trends into cosmetics quickly. To maintain the ethos of that brand… we kept it outside of our normal processes.”

Going outside of the business to tap into ideas can also prove game-changing. Martin Grieve, SVP of Corporate Business Planning at FTSE 100 listed consumer goods company, Reckitt Benckiser, says: “We have many external collaborations with third parties. In today’s world, business leaders are increasingly recognising that collaborative work with third parties will deliver breakthrough innovation.”

Show your appreciation

Rewards and recognition are significant motivators. Jane comments: “We have a system of reward in the company called ‘Global Standards of Leadership Awards’, which reward good behaviour within our Credo, and innovation is one of these.

“But one of the principles I ensure happens is publicly recognising people – even if it’s only on email, or a formal memo to somebody that copies in their boss or their colleagues, that says: ‘What you’ve done is fantastic’. I think recognition is very important… the ultimate recognition of someone who is consistently innovative and contributing a lot to business is that their career advances.”

Whether it’s inhibiting corporate processes, external regulations, fear of cannibalisation or a question of talent, the barriers to innovation are high. Nonetheless, it’s vital that the senior leadership team does whatever it can to allow for progressive disruption of the status quo so the necessary breakthroughs are made.

Martin Hess explains: “I don’t think companies can succeed… without constantly looking to change and innovate. You might become a leader in one technology wave, but you won’t be able to succeed in being a leader in successive waves.

“It’s one of the few things that an organisation has to be extremely good at and to encourage if it’s to prosper.”

Martin Grieve comments: “Innovation is the lifeblood of what we do. It is what fuels the growth of the business; it’s about keeping our brands relevant to consumers, continually improving performance and consumer benefits.”

I hope to see you soon.

Matthew

www.twitter.com/criticaleyeuk 

Why CEOs Should Listen and Learn

Running a business is the easy part for a chief executive. Apart from charming investors, being fluent in finance and attuned to HR, there is the need to communicate smoothly across multiple media channels. It all amounts to a business lingua franca that has to be grasped fully as nowadays no CEO can afford to be lost for words.

Peter Cheese, Chairman of the Institute of Leadership Management, says: “It is about being aware of who you are, what you stand for and allowing that to come across in an authentic way – that is one of the things that good leadership is about.”

A clear message has to be relayed. “All these new channels need to be understood, embraced or effectively used by business leaders,” continues Peter. “The people that they are trying to reach, such as their employees, customers and other stakeholders, are using these channels and they expect therefore to be communicated through them. Another challenge is to ensure that the messages being delivered are consistent. It is easy to confuse the messages when you have lots of different channels and ways of communicating.”

Whether it’s a badly handled crisis, a rogue tweet or an overly casual text to a business associate, it is clear that lapses in communication can result in a deluge of negative publicity. Sir Stuart Rose, Non-executive Director at property concern Land Securities Group, says: “Because everything moves so fast you need to be a multi-tasker, to have even better communication skills and good emotional intelligence – antennae that can pick up nuances and threads from all sorts of places and inputs.”

Beyond that, comes the ability to assess the numerous sources of financial and strategic data that are now available. Jo Sellwood-Taylor, a Founding Director at recruitment firm Mullwood Partnership, says: “The CEO’s role has changed. It has become much more about collaboration and you need your top team and leaders to be able to constantly work together – gone is the egocentric CEO. They need to work far more collaboratively, even outside their team and [usual] network and they’ve got to be someone who is transparent, genuine, humble and approachable to allow that to happen.”

Graeme Yell, a Director at management consultancy Hay Group, says: “What a lot of people do is still based around the ‘Superstar CEO’ and developing individual capabilities beyond everything else; I don’t think it necessarily takes into account the types of behaviour that leaders are going to need to display in the future as much as it should do.”

Taking responsibility

The need to interact internally with transparency and clarity is increasingly important too. Richard Ackroyd, CEO of Scottish Water, says: “You have to tell and inform people [in an organisation] more rather than less. Historically, too many organisations have worked on a need to know basis and my experience is that the more you tell people, the better it is because what tends to happen is that they understand where they fit in the big picture and what their role is in relation to others.”

Peter agrees: “Given the range of communications expected from leaders, you need to be able to use all these channels in the right fashion. It does go two ways and the challenge as a leader is to have the time to use these channels effectively as it is all coming at you. Of course, the more you use these things the more you are going to get back, so it becomes a growing challenge in terms of the management of your own time.”

Within all of this comes a greater sense of responsibility and broader awareness too of the material and emotional impact a business may be seen to have on people’s lives. Martyn Fisher, Executive Vice-President of Industrial Europe for Veolia Water Solutions & Technologies, says: “When the economy is a bit tougher, people are scrutinised over their creativity and strength of leadership. There is a healthy scepticism that we see in the press about highly paid leaders getting bonuses, and a general perception that business is easy to do most of the time.

“Business isn’t easy to do in a recession and that puts leaders under a microscope in terms of not just their strength of character and the quality of their communication skills, but also in their creativity and invention.”

Valery Katkalo, a Criticaleye Thought Leader and Vice Rector at St Petersburg University, says: “When you progress up in a business you have more responsibility for the whole organisation’s image. This is where real leaders are making the difference today […] being able to look broadly at what businesses can do to address the issues that society is concerned with.”

All in all, CEOs trying to get ‘the big picture’ of their organisation’s health and purpose will have to be brave and break new ground to determine what information streams to delegate, what to ignore, what to own and to admit what could and should be done better.

Please get in touch if you have any comments about the issues raised here.

I hope to see you soon.

Matthew

www.twitter.com/criticaleyeuk

How to Create a World-Class Brand

Businesses are operating in marketplaces with unprecedented international opportunities, retail channels and competition. When adapting a brand to meet the diverse and new demands of customers, leaders face a real challenge in keeping an organisation on the right track.

Professor Dominique Turpin, President of IMD and a Criticaleye Thought Leader, says: “There are some basic principles to be a great brand these days, such as a regular stream of innovation – small, regular alterations to keep yourself new and interesting. A brand that doesn’t have that is perceived as dusty and customers just won’t buy it.”

That’s why it has to be a boardroom issue. Pam Powell, Ex-Group Marketing Strategy & Innovation Director at brewer SABMiller, argues that leaders would be foolish to assume that their ability to steer a brand has diminished in recent years: “Branded consumer goods companies live and die by their brands, and the senior executives take a responsibility for the changes that are made, even if they rely on their marketing teams and departments to bring them proposals. This notion that you put a brand out there and hope for the best is just wrong.”

Nevertheless, the advent of social media means that the level of control an organisation can exercise over a brand has changed dramatically. Graham Hales, UK CEO of brand consultancy Interbrand, says: “In reality, you cannot create a brand without consumers. The number of consumer ‘spokespeople’ is far greater than those employed by a business, and word of mouth over the internet is given far more credibility than the corporate’s own branding. As a result, consumers probably have an even more important role in creating the brand than the people you pay to communicate it.”

Stephen Pain, Vice-President of Reputation Strategy, Planning & Research for Unilever, sees collaboration as the key to the future of brands: “In the world of social media, brands do not tell, they engage and invite dialogue, moving from creating a brand for consumers to curating brands with consumers through communities of interest. And never forget the importance of your employees; they are the most powerful brand advocates of all.”

Rising stars

The multiplicity of channels adds to the complexity, especially when targeting new territories. Pam explains: “When you take the brand international, there is always a tension between keeping the global mix consistent […] and how much you adapt to local cultural norms or requirements. Changes can water down positioning over time, with lots of different things in various markets with no connections, shared platforms or benefits of scale.”

For five years Pam was Global Brand Director at beauty and skincare specialist Dove, where she worked on implementing the brand concept of femininity: “The cultural expressions of that notion vary hugely between Northern Europe and South America and the presentation and delivery are quite different, but knowing that, we were able to get the core message of the brand across in the same way, but in a manner that was locally relevant and culturally sensitive.”

Mark Allan, Chief Executive of housing specialist UNITE Group, says: “For a brand to make a consistent impact it must bear scrutiny on a rational and emotional level. If the core proposition doesn’t align precisely with the experience, the sales pitch or the company’s reputation with any stakeholder group, it will undermine commercial strategies quickly. At the first sign of weakness or inconsistency, that’s it for your brand.”

It’s something that holds true for both small and large companies. Ian Bowles, CEO at software provider Allocate, says: “Creating a strong brand as a smaller company is difficult, but not impossible. Our brand is evolving as we grow, but it is recognised in the sectors we are focused on. You can build a brand without huge marketing budgets, but the strategy has to be very carefully considered before you begin.”

Mark says: “Building a global brand must start with staff. As the constant living embodiment of the brand, all employees need to understand what their company stands for, how this will make customers feel, and therefore how they need to ‘be’ in order to deliver this experience every time.

“Consistency becomes more challenging across different markets and cultures, but simplicity and clarity will help, reinforced through constant measurement of brand perception, and sharing of good practice and successes.”

It’s a tough line to tread and requires substantial planning. Graham explains: “Organisations have to move into new regions with a great deal of intelligence – you have to give the brands the right degree of autonomy to succeed in their different marketplaces but design them to allow them to become, ultimately, more synergistic and more consistent.”

As the world communicates faster and more expansively, it is becoming increasingly evident that leaders must position their businesses in a way that gets the right kind of attention.

Please get in touch if you have any comments about the issues raised here.

I hope to see you soon.

Matthew

www.twitter.com/criticaleyeuk

Fresh Innovation

The most successful companies know the value of innovation and creativity. They understand how to bring this to the fore within their own organisations, but they also draw on research, insight and expertise from external sources to gain that all important competitive edge.

Business schools and academia have a crucial role to play in empowering companies through such intellectual joint ventures. Paul Walsh, Chief Executive Officer of Diageo, says: “Beyond the obvious research and development and innovation opportunities, it’s inescapable that ideas are the lifeblood of a successful company. Academic institutions not only create those ideas, but they can also bring the genuine fresh thinking about their application that gives them traction.”

A live instance of this can be seen in the field of M&A. Thras Moraitis, Executive General Manager Group Strategy and Corporate Affairs for Xstrata plc, started working with Han Smit, a Criticaleye Thought Leader and Professor of Corporate Finance at Erasmus University, some years ago when he was considering a theory on acquisition techniques (Real Options) during the $20 billion buy-out of Falconbridge. As Han was an expert in the field of Real Options, the academic was, says Thras, able “to bring an intellectual rigour and framework to Xstrata’s long-standing view that increasing optionality was an important ingredient in evaluating target acquisitions”.

He continues: “It was possible to acquire some of the options ‘cost effectively’ as most valuations focus primarily on the current value of future cash flows, not including the value of embedded optionality.”

The blend of Thras’ experience as entrepreneur, advisor and executive, combined with Han’s academic constructs and specialism in corporate finance, have seen the two develop a new field of strategy which can be applied to M&A (termed Strategic Opportunism). “Traditional strategy frameworks and thinking have, in my opinion, not been strong in reflecting the increasingly dynamic nature of the environments in which we operate, nor have they made a strong link between strategic courses of action and the value of a company as reflected in the investment community,” says Thras (for more information about Han and Thras’ theory on Serial Acquisition Options, click here).

Real world

Naturally, the best ideas and theories should have some kind of commercial or pragmatic application. Robin Buchanan, a Non-executive Director of Schroders and former Dean and President of London Business School, says: “Great business schools bring new insights by combining the rigour of academic discipline with the relevance of the business world.”

Nandani Lynton, another Criticaleye Thought Leader and Adjunct Professor of Management at the China Europe International Business School in Shanghai, comments: “Business likes to know that there is stringent theory and research behind models before they use them. Academia helps business by providing the scientific testing ground, but it often seems to take a breed of middlemen – practical academics with business experience or specialised business journalists – to take the research insights and present them in a form useful to practitioners, usually with illustrative business examples.”

At present, there continues to be a number of professors who are too insular in their research, operating to the flighty abstractions of academia as opposed to engaging with the earthbound practicalities of business. June Boyle, HR Director Organisation Effectiveness at Lloyds Banking Group, observes: “There are some academics who only have time for their own research and, while it might be interesting, that’s about as far as it goes.”

Likewise, Robin notes that some business schools make the mistake of “recycling conventional wisdom” for business executives which isn’t really about educating and encouraging new thinking, it’s simply training: “The trap that other schools fall into is to get so deep into the research minutiae that the academic comes up with a perfectly polished piece of research into topics that have no relevance to business or even other academics.”

Bill Payne, Vice President, CRM and Industries Global Process Services at IBM, argues that, although the top business schools and academic institutions do generally lock-on and get engaged in business practicalities, it is the next tier where some work may need to be done.

A way to address this, Bill suggests, is for key departments to interact more closely: “This is where business schools can really get their act together. There is a paradigm shift that can happen here where there is a link between business schools, maths departments and finance departments. It is finance and monetisation that drives business, it’s mathematics that powers analytics and it’s the business schools that should have the out-of-box thinking that bring it all together.”

Interaction is the fulcrum for propelling new ideas. Indeed, when business leaders themselves engage with professors to discover the latest concepts, and impart their own expertise and knowledge to galvanise relevance, it becomes a potent combination. Bill says: “There is a wealth of innovation, brain power and out of the box thinking but I see it as being somewhat like a CPU [central processing unit] and the wire needs to plug back into business. There are far too few senior business people like me who put time into giving something back.”

Terms of reference

In the UK, the relationship between business and academia is currently perceived to work best in the technology sector. Michael Kitson, a macroeconomist at Cambridge Judge Business School, argues that this does a disservice to the vast array of knowledge out there.

“There is a view that academia only influences business through science, technology, patents, licences and spin-offs,” he explains. “But that is only a very small part of the picture as there are a lot of hidden interactions going on through informal advice, consultancy, problem solving, student placements and curriculum development.

“The first point I’d make is that these interactions are not about technology transfer, they’re about exchanging knowledge. Secondly, it’s not just all about engineering and science; there are a wide number of disciplines involved, of which business and management seems to be particularly important.”

A good example of this can be seen through the work of Victor Dulewicz, Managing Partner of VDA Assessment & Development Consultants and Emeritus Professor at Henley Business School. He has worked with a number of multi-nationals and financial institutions, pioneering techniques into managerial and director assessment, appraisals and development.

Infact, although people were highly skeptical of these tools 20 or 30 years ago, many are now in the mainstream. “When I am advising companies or doing assessments on managers, it’s widely accepted as something that needs to be done,” he says, adding that corporate non-executive directors of boardrooms are now opening up to such evaluation too.

Paul Walsh describes the relationship between business and academia as a “two-way street”. He says: “Academic institutions have to be highly practical and refine what they offer. In today’s uneven world economy, the competition for talent and ideas is global…[so] only those with a strong, well-based business proposition will thrive.”

Evidently, the best business schools have the professors on board who realise this, individuals who can provide the necessary research, training and education, while also maintaining close relationships with companies. Dr Dennis Gillings, Chairman and CEO of bio and pharmaceutical company Quintiles Transnational, who is also on the advisory board of Cambridge Judge Business School, insists that this is where the future lies. “We need our major institutions putting more of their intellectual energy into what is going to create more value in society.

“It’s exactly what Britain needs: the major academic institutions paying more attention to the value creating, entrepreneurial activities which go on to create more jobs and more value in society. The East is where the manufacturers and commodities will come from in the future, so we have got to have our major institutions leading the way on business-focused skills and knowledge.”

For Han Smit, the benefits to be gained by professors working with the key-decision makers in companies is clear to see: “I firmly believe that the links between academia and the business world should be stronger. I am constantly surprised by the number of great innovations from academia which are not used to their full potential by practitioners.”

Fundamentally, the goal should always be to make innovation happen and this is why Criticaleye has created its Thought Leaders initiative, which pools together some of the world’s leading professors. It provides a platform for professors and academics to share their world-renowned insights and research by entering into a dialogue with the Criticaleye Members, thereby forging a cutting-edge Community dedicated to promoting fresh thinking and radical new ideas for business.

Please get in touch if you have any comments about the issues raised here.

I hope to see you soon

Matthew

www.twitter.com/criticaleyeuk