Managing complexity in organizations : text and cases

Combining rigorous academic research with the latest practical tools and techniques, this book explores the growing area of complextity management in business. Through a range of high quality international cases leading authors help students to understand how to manage organizations in unpredictable and complex business environments.

Author Notes

CHRISTOPH NEDOPIL is Managing Director of YOUSE, an innovation consultancy in Berlin, Germany, and Consultant for the World Bank.

ULRICH STEGER is Professor of Environmental Management at IMD, Lausanne, Switzerland.

WOLFGANG AMANN is the Director of Executive Education at the Goethe Business School, Frankfurt, Germany. He also teaches at both St. Gallan and IMD in Switzerland. He was previously Professor of Strategy and International Business at Henley Management College, UK.
CHRISTOPH NEDOPIL is Managing Director of YOUSE, an innovation consultancy in Berlin, Germany, and Consultant for the World Bank.

ULRICH STEGER is Professor of Environmental Management at IMD, Lausanne, Switzerland.

WOLFGANG AMANN is the Director of Executive Education at the Goethe Business School, Frankfurt, Germany. He also teaches at both St. Gallan and IMD in Switzerland. He was previously Professor of Strategy and International Business at Henley Management College, UK.

List of Figures and Tables	p. x
Foreword	p. xiii
Acknowledgements	p. xiv
About the Authors	p. xv
Part I A Global Framework for Managing Complexity
1 Managing Complexity in Organizations: How to Apply Ockham's Razor	p. 3
1.1 Introducing global complexity	p. 3
1.2 Complexity in a flat world	p. 4
1.3 Drivers of complexity and how they create managerial dilemmas	p. 7
1.4 The way to manage complexity: Ockham's Razor	p. 9
1.5 Structure of the book	p. 13
1.6 References and further reading	p. 16
Part II Managing the Complexity of Business Models and Strategy
Roadmap to Managing the Complexity of Business Models and Strategy	p. 21
2 Business Models and Strategy	p. 23
2.1 Strategic success in the BC era	p. 23
2.2 Complexity drivers	p. 24
2.3 Complexity simplifiers	p. 27
2.4 Dealing with complexity by focusing on core strategic principles, not hypes or fashion trends	p. 30
2.5 Alignment of mental maps for humility and readiness for adversity	p. 32
2.6 Standardizing and decentralizing processes: limiting complexity to the right place	p. 33
2.7 Case study introduction	p. 34
2.8 Case study: CANDO SA: strategy formation and implementation in complex environments	p. 34
2.9 Case study discussion	p. 40
2.10 References and further reading	p. 42
3 Complexity Drivers in Sustainable Strategies	p. 43
3.1 When will we see real progress in sustainability?	p. 43
3.2 Complexity drivers	p. 45
3.3 Simplifiers	p. 48
3.4 Complexity case study introduction	p. 50
3.5 Case study: Hindustan Lever: leaping a millennium	p. 50
3.6 References and further reading	p. 57
4 Complexity in Global Business Strategies	p. 58
4.1 An increasingly complex perspective	p. 58
4.2 Complexity simplifiers	p. 63
4.3 Case study introduction	p. 65
4.4 Case study: Lufthansa AG: going global, but how to manage complexity?	p. 65
4.5 References and further reading	p. 77
5 Managing Risk	p. 79
5.1 Introducing risk management and its strategy	p. 79
5.2 Complexity drivers	p. 80
5.3 Complexity simplifiers	p. 84
5.4 Case study introduction	p. 88
5.5 Case study: Jack Miller's challenging risk assessment	p. 88
5.6 References and further reading	p. 96
6 Partnerships and Alliances	p. 98
6.1 Monitoring complexity in partnerships and alliances	p. 98
6.2 Complexity drivers	p. 98
6.3 Complexity simplifiers	p. 102
6.4 Case study introduction	p. 103
6.5 Case study: European Auditing and Financial Services Inc. (EAFS): leaping forward or sliding backward?	p. 104
6.6 References and further reading	p. 115
Part III Complexity and the Organization
Roadmap to Complexity and the Organization	p. 119
7 Complexity and the Organization	p. 121
7.1 Complexity and organizational architecture	p. 121
7.2 Complexity drivers	p. 123
7.3 Complexity simplifiers	p. 126
7.4 Case study introduction	p. 130
7.5 Case study: Rebuilding ABB	p. 130
7.6 References and further reading	p. 151
8 Corporate Governance	p. 154
8.1 Corporate governance and its inherent complexities	p. 154
8.2 Complexity drivers	p. 155
8.3 Complexity simplifiers	p. 158
8.4 Case study introduction	p. 159
8.5 Case study: Failure of corporate governance at UBS	p. 159
8.6 References and further reading	p. 168
9 Subsidiary Management	p. 170
9.1 Complexity in subsidiary management	p. 170
9.2 Complexity drivers	p. 171
9.3 Complexity simplifiers	p. 172
9.4 Case study introduction	p. 177
9.5 Case study: Pharmagroup Int. and Fluvera: when subsidiary governance means losing competitive ground	p. 177
9.6 References and further reading	p. 186
10 Project Management	p. 188
10.1 Project management and complexity	p. 186
10.2 Complexity drivers	p. 189
10.3 Complexity simplifiers	p. 191
10.4 Case study introduction	p. 195
10.5 Case study: Global diesel engine project: where are the simplifiers for the overwhelming complexity?	p. 195
10.6 References and further reading	p. 202
Part IV Business Functions and Their Inherent Complexities
Roadmap to Complexity in Business Functions and Their Inherent Complexities	p. 205
11 Marketing	p. 207
11.1 Marketing in a complex, global environment	p. 207
11.2 Complexity drivers	p. 208
11.3 Complexity simplifiers	p. 213
11.4 Case study introduction	p. 216
11.5 Case study: Disneyland Resort Paris: Mickey goes to Europe	p. 216
11.6 References and further reading	p. 231
12 Supply Chain Management: The Backbone of Complex, Global Acting Organizations	p. 232
12.1 Why is supply chain management so complex?	p. 232
12.2 Complexity drivers	p. 235
12.3 Complexity simplifiers	p. 238
12.4 Case study introduction	p. 242
12.5 Case study: Sustainable agriculture in Nestlé's supply chain: how to get everybody on board?	p. 242
12.6 References and further reading	p. 251
13 Management of IT and Technology	p. 253
13.1 Introducing IT and technology	p. 253
13.2 Complexity drivers	p. 254
13.3 Complexity simplifiers	p. 257
13.4 Case study introduction	p. 262
13.5 The ONE Platform project for Chai-Bank	p. 262
13.6 References and further reading	p. 269
14 Human Resources Management	p. 270
14.1 Introducing human capital management	p. 270
14.2 Complexity drivers	p. 271
14.3 Complexity simplifiers	p. 273
14.4 Case study introduction	p. 278
14.5 Case study: War for management talent in China	p. 278
14.6 References and further reading	p. 283
15 Innovation Management	p. 285
15.1 What is innovation management?	p. 285
15.2 Complexity drivers	p. 286
15.3 Complexity simplifiers	p. 291
15.4 Case study introduction	p. 295
15.5 Case study: Innovation at the LEGO Group	p. 295
15.6 References and further reading	p. 308
Part V The People Factor and Managing Crises
Roadmap to Complexity in The People Factor and Managing Crises	p. 313
16 Leadership, despite Complexity	p. 315
16.1 The qualities of leading in a complex world	p. 315
16.2 Leadership framework	p. 315
16.3 Case study introduction	p. 320
16.4 Case study: Carnival in Rio: homicide or suicide?	p. 320
16.5 References and further reading	p. 325
17 Complexity and Stakeholders	p. 326
17.1 Complexities in managing stakeholders	p. 326
17.2 Complexity drivers	p. 326
17.3 Complexity simplifiers	p. 328
17.4 Case study introduction	p. 330
17.5 Case study: Transforming the global fishing industry: the Marine Stewardship Council at full sail?	p. 331
17.6 References and further reading	p. 344
18 Complexity in a Crisis	p. 346
18.1 Looking below the surface	p. 346
18.2 Complexity drivers	p. 347
18.3 Complexity simplifiers	p. 351
18.4 Case study introduction	p. 355
18.5 Case study: Murphy's law and the crisis at Jurassic Oil Company	p. 355
18.6 References and further reading	p. 362
Part VI Managing Complexity, In Summary
19 Managerial Implications	p. 365
19.1 Lessons to be learned: get the details right but lake a consistent strategic approach	p. 365
19.2 A great idea is just not enough	p. 365
19.3 The fish starts to smell bad from the head first	p. 367
19.4 The personal dimension: what it all means for you	p. 368
References	p. 369
Index	p. 382

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