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Managing the Company of the Future
has been developed collaboratively by

University of London and London Business School.
Copyright Julian Birkinshaw 2014
Managing
the Company
of the Future
Julian Birkinshaw
www.london.edu
Overview of
the course
The Business World is changing
Social change:
Gen Y
Technology:
Web 2.0
New strategic
challenges
Purpose, Innovation,
Agility, Engagement
Emerging
economies
Sustainability
concerns
Our management model is no longer fit for purpose
Coordination achieved through
Rules & Procedures

Decisions made according to
Hierarchy
People motivated by
Extrinsic Rewards
Objectives set through
Linear Alignment
Bureaucracy
Two different views of the future
Radically different
Photo: Sam Howzit
Same as it ever was
Forces for stasis
Forces for change
What this course is about
Managing
the company
of the Future
Management
versus
Leadership
Winston Churchill
Richard Branson
Photo: Matt Yohe
Photo: David Shankbone
What is Leadership?
Steve Jobs
Leadership: A process of social influence

A leader is someone who attracts followers by virtue
of what they say and how they act
What is Management?
Koontz & ODonnell, Principles of Management, 1955
What is Management?
Getting Work Done Through Others

Bringing People Together to
Accomplish Desired Goals
Photo: Keiradog
Management has been

squeezed out by Leadership
A Leader
A Manager
Copes with change

Sets a direction
Aligns people
Motivates people
Copes with complexity

Plans & budgets
Organizes & staff
Controls & problem-solves
Photo: TeamBennis
John Kotter
Warren Bennis
Promotes effectiveness
Is his/her own person
Originates
Challenges the status quo
Promotes efficiency
Is a good soldier
Imitates
Accepts the status quo
Managing:
The word that dares not speak its name
I equate management with bossy, insecure, weak

people trying to intimidate
A manager is someone who interferes with someone

elses work
I think in the National Health Service, manager is a

particularly dark word if I am one of those managers,
the implications is I am not that good, not that
competent
Management versus Leadership
A false dichotomy: effective executives need to work on both

The challenge is to get the right balance
This course focuses on management to help redress the
balance
How is the
business world
changing?
Exponential change is underway

in many technological areas
Credit Default Swaps

Processor speed (MIPS)
Processing power/$
Number of internet hosts
Data transmission speeds
Cost of bandwidth (bits/second/$)
Number of genes sequenced
Astronomical data collected
So how exactly is the world changing?
KNOWLEDGE
ERA
INDUSTRIAL
ERA
?
1920
1940
1960
1980
2000
Transitioning from the industrial era

to the knowledge era
KNOWLEDGE
Productivity
driving out
motivation
Photo: Flickr: Allan Ajifo
Photo: Flickr: doctorwonder
Efficiency
driving out
effectiveness
LABOUR
Photo: Climate Disclosure Standards Board
INFORMATION
CAPITAL
Transitioning from the industrial era

to the knowledge era
KNOWLEDGE
Productivity
driving out
motivation
Photo: Flickr: doctorwonder
Efficiency
driving out
effectiveness
LABOUR
INFORMATION
CAPITAL
Transitioning beyond the knowledge era

DECISIVE ACTION
INFORMATION
Too much
information
creates deficit
of attention
EMOTIONAL CONVICTION
KNOWLEDGE
Overemphasis
on logic leads
to sterile
decision making
The changing source of advantage
INDUSTRIAL
ERA
KNOWLEDGE
ERA
POST
KNOWLEDGE ERA
Labour
Capital
Information
Knowledge
Action
Conviction
The Failure of
Traditional
Management
Many high-profile management failures
Photo: US Coast Guard
most of the mistakes and

oversights at Macondo can be
traced back to a single
overarching failure - a failure
of management
William Reilly, Co-Chair, National Oil Spill

Commission, January 2010
Employee engagement levels are low

across most countries
80
60
40
20
0
Highly Engaged
Moderately Engaged
Source: Towers Perrin Global Workforce Study via The Employee Engagement Group
Disengaged
Who are you happiest with?
Friends
3.3
Parents/relatives
3.0
Spouse
2.8
My children
2.7
Co-workers
2.6
Clients/customers
2.4
Alone
2.2
Boss
2.0
(Rating is on a 1-5 scale)
What problem was management

invented to solve?
How to routinise and

standardise work?
How to maximise employee
discipline and diligence?
How to organise complex
work processes?
Source: Gary Hamel
What are todays management challenges?
How do we change fast enough to

stay relevant in a turbulent world?
Agile
How do we innovate boldly enough

to stay ahead of our competitors?
Innovative
How do we create an organisation

where people are able and willing to
do their best work?
Engaging
Source: Gary Hamel
Koontz & ODonnell, Principles of Management, 1955
The Need for

Management
Innovation
FROM NEW
PRODUCTS AND
SERVICES
Photo: Apple
Broadening our concept of innovation
Photo: Google
TO NEW
WAYS OF
WORKING
Innovations in management can be

a source of long-term advantage
Ford
1900s-1920s
GM
1930s-1960s
Toyota
1970s-2000s
Linus Torvalds
Photo: Philip Bachmann
Photo: Enrique Dans
Photo: llinusmag.com
The Internet as inspiration

and engine of change
Tim Berners-Lee
Jimmy Wales
Todays Management Innovators
Zappos
Topcoder
Valve
Morning Star
Terri Kelly, CEO, WL Gore
Photo: World Economic Forum
Photo: Chemical Heritage Foundation
Todays Management Innovators
Vineet Nayar, former CEO,

HCL Technologies
What does this

mean for me?
The changing source of advantage
INDUSTRIAL
ERA
Monitor
and
Controller
KNOWLEDGE
ERA
Information
Conduit and
Expert
POST
KNOWLEDGE ERA
Implementer
and
Empathiser
Googles Project Oxygen:

What makes a good manager?
1. Be a good coach
2. Empower your team and don't micromanage
3. Express interest in team members' success and personal well-being
4. Don't be a sissy: Be productive and results-oriented
5. Be a good communicator and listen to your team
6. Help your employees with career development
7. Have a clear vision and strategy for the team
8. Have key technical skills so you can help advise the team.
Adam Bryant, New York Times, March 12th 2011
And what does this mean for the employee?

Consider the mens world high-jump record
2.55m
2.45m
2.35m
2.25m
2.15m
2.05m
1.95m
1900
1920
1940
1960
1980
2000
John Thomas vs. Valeriy Brumel
2.55m
Bundesarchiv, Bild 183-S0305-0030
2.45m
2.35m
2.25m
The Straddle Jump
2.15m
2.05m
1.95m
1900
1920
1940
1960
1980
2000
Dick Fosbury: Mexico Olympics Gold
Bundesarchiv, Bild 183-W0718-0022
2.55m
2.45m
2.35m
Athlete performing a Fosbury Flop
Olympics
2.25m
2.15m
2.05m
1.95m
1900
1920
1940
1960
1980
2000
Three waves of innovation in

the high jumping industry
2.55m
The Fosbury Flop
2.45m
The Straddle Jump
2.35m
2.25m
The Western Roll
2.15m
2.05m
1.95m
1900
1920
1940
1960
1980
2000
George Bernard Shaw:
Photo: Brian Solis
Progress depends on unreasonable people
Elon Musk and the Hyperloop proposal

What does this mean for me?
Understanding the changing world

Evaluating the old and new ways of managing
Managing others more effectively
Taking the initiative to help shape the company of the future

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Managing the Company of the Future

has been developed collaboratively by

Copyright Julian Birkinshaw 2014

Copyright Julian Birkinshaw 2014

The Business World is changing

Copyright Julian Birkinshaw 2014

Our management model is no longer fit for purpose

Coordination achieved through

Rules & Procedures

Two different views of the future

Photo: Sam Howzit

Same as it ever was

Forces for stasis

Copyright Julian Birkinshaw 2014

Forces for change

What this course is about

Copyright Julian Birkinshaw 2014

Copyright Julian Birkinshaw 2014

Photo: Matt Yohe

Photo: David Shankbone

Leadership: A process of social influence

Copyright Julian Birkinshaw 2014

Koontz & ODonnell, Principles of Management, 1955

Copyright Julian Birkinshaw 2014

Getting Work Done Through Others

Copyright Julian Birkinshaw 2014

Management has been

Copes with change

Copes with complexity

Copyright Julian Birkinshaw 2014

I equate management with bossy, insecure, weak

A manager is someone who interferes with someone

I think in the National Health Service, manager is a

Management versus Leadership

A false dichotomy: effective executives need to work on both

Copyright Julian Birkinshaw 2014

Copyright Julian Birkinshaw 2014

Exponential change is underway

Credit Default Swaps

Copyright Julian Birkinshaw 2014

So how exactly is the world changing?

Copyright Julian Birkinshaw 2014

Transitioning from the industrial era

Photo: Flickr: Allan Ajifo

Photo: Flickr: doctorwonder

Copyright Julian Birkinshaw 2014

Photo: Climate Disclosure Standards Board

Transitioning from the industrial era

Photo: Flickr: Allan Ajifo

Photo: Flickr: doctorwonder

Copyright Julian Birkinshaw 2014

Photo: Climate Disclosure Standards Board

Transitioning beyond the knowledge era

Photo: Flickr: Allan Ajifo

Copyright Julian Birkinshaw 2014

The changing source of advantage

Copyright Julian Birkinshaw 2014

Copyright Julian Birkinshaw 2014

Many high-profile management failures

Photo: US Coast Guard

most of the mistakes and

Copyright Julian Birkinshaw 2014

William Reilly, Co-Chair, National Oil Spill

Employee engagement levels are low