In evidenza

Between Scylla and Charybdis: finance generating (only) other finance.

scilla e cariddi

It’s time for some clear statement about future investments and, above all, about the picture of the future startupper/entrepreneur we want to deal with.

Scylla and Charybdis were mythical sea monsters noted by Homer. Sited on the opposite sides of the Strait of Messina between Sicily and the Italian mainland, they were regarded as maritime hazards. Scylla was on the Italian side of the strait and Charybdis was a whirlpool off the coast of Sicily. Trying to avoid Charybdis meant passing too close to Scylla and vice versa.

At the moment, starting up is synonymous of innovation, enthusiasm and risk.

Well, this point of view is seriously endangered by two factors, two major risks surrounding startups.

With Uber shares sinking more than 15 percent below the stock’s initial price, in an article recently published in the NY Times the author hoped that the possible flop of UBER’s listing could represent an epitaph or at least a global warning for supporters of the “winner – take-all” venture capital style model. This distortive investment model, instead of focusing on finding good investment opportunities, aims to create an exclusive “super-unicorns club” (the unicorn is a startup company with an estimated value around 1 billion). This means that VC should only look for companies to be funded with checks between 500 million and 5 billion dollars, basically on the basis of some generic promises of future earnings.

Mainly we are talking about some self-fulfilling prophecies, where, by investing huge amounts in startups regardless of their economic results, many other investors are pushed to do the same. At the same time, these companies, including Uber, are given the opportunity to implement the strategy that was already Amazon’s one, such as benefiting their consumers with very affordable rates and products, simply because, thanks to the enormous funding received, their pockets are deeper than others. Being part of the club then allows this unicorn to do business, on paper very advantageous, with other companies like them, incidentally belonging to the same club.

In other words, we are definitely facing finance that generates finance, without many ties to the real economy and even less with innovation that should instead characterize startups.

This, in addition to diverting capital from really promising startups, and that’s too bad, would also send some wrong and distortive message to young entrepreneurs, something like “it is much better to be a showman than a entrepreneur“, and that’s even worse. a fundamental disconnect between public and private valuations. Not to mention the risks of domino effect an of massive loss of money that this huge disconnect between public and private valuations represents.

In other words finance that generates other finance

So much for factor nr.1

tra il martello e l'incudine

What about factor nr. 2?

Initial Coin Offerings (ICOs) have gained a lot of attention over the past months as an ideal crowdfunding solution but the floor fell out due to the lack of proper regulation putting the investor at risk that also paved the way for fraud. This represented a major economic loss for focusing for investors focusing on blockchain and cryptocurrency-related opportunities.

Despite this major problem, somebody say there is a new turning point, able to represent in a few years a real tsunami for crowfunding and, in general, for venture capitalist. This solution is called STO (security token offering). An STO is a token offering that is similar to an ICO but its main difference is that STOs are regulated, because whereas ICO tokens are sold just on the promise of future utility, security tokens are instead bought for the explicit purpose of making a return on investment.

And here is the new magic spell: tokenization of venture capital. It seems fantastic: in the end tokenization of VC portfolios happens on the blockchain, which offers some additional layer of security, investors can be safer and much more because you are going to invest on tokenized VC portfolio, which means security of investment through diversification, traceability of investments through the blockchain. And on this way, somebody says, we can solve the problems VC are facing: the way-out on their investments, and most of all, the lack of liquidity due to the relatively small percentage of their financed startups having a consistent market success.

Yes, fine, but in future we also would like to have real companies and not with zombies just kept alive with the help of finance.

If you look at pitching material of such tokenization platforms, their mantra is always the same: distributing risk, making the VC job looking like another widespread investment product. But what has this to do with financing “the bold and the brave” startupper? Not much.

Again, the impression is that we are dealing with finance generating other finance

Hope that VC will continue to play “traditionally” their fundamental role on the industrial system, certainly using also the opportunities deriving from technology and evolution of financial world, but always staying grounded on having with their choices an impact on  “real” economy. And good luck to all startuppers having, in addition to their heavy tasks, to navigate between such two hazards, being therefore between a rock and a hard place.

Annunci
In evidenza

Some key additional pitching hints

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A few general hints on pitching (whatever are you going to pitch/communicate), useful for anyone, as emerging from today’s session. Thanks for the very high quality of your presentations and for your effort.

-beforehand, tell who you are and, briefly, how did you come with the idea.;

product (or service) is king: don’t grasp on details if you don’t show it enough through the use of photos and other illustration;

mission is how to win the battle, vision is about winning the war: they cannot look like each other and/or looking like program. They should represent an inspiring and memorable ideal (try to reading it to your audience while you are testing your presentation: now move to the next slide and try to ask if they remember it. If at least 50% pf people does, you probably did a rather good job;

Canvas is not a concept-fastfood, but instead a place for gourmet, interested in tasting good ideas: therefore you shouldn’t write either too few or too much words, but just the necessary to let people understand and make the right connections …and, by the way, very good if you do it with the help of graphics;

Customer segments: try to describe in a profile what makes that segment homogeneous …if you write down a profile of each category with 80 to 120 words, is perfect. And you may soon realize that a described segment is very often made of slightly different sub-categories…;

Revenues streams: that’s definitely not a secondary subject…try always to be specific on this subject…your potential investors will be happy with it!!!;

Partners, suppliers, or (even) customers? Especially when business model is sketchy it may happen one of the following things: 1. The role of a supplier is underestimated: is not simple to replace, the quality of your stuff is literally depending on it…maybe we are talking about a partner? 2. At the very beginning, there is no way to pay for the purchased service: that supplier MUST be involved as a partner, sharing (if possible) its future success/revenues 3. Sure that what you are indicating as a partner is not instead the real customer of your service? If it controls the necessary facilities, the business relationship and maybe some distribution channel…maybe you should change your mind…;

pitching 2

-always indicate at least 3 possible competitors, and instead 3 companies belonging to your business area that you consider very different from your model and/or having a somehow “old-fashioned” model comparing to yours. That would help you to reaffirm your identity and competitive advantage, and your public understanding clearly what makes you special and different;

Take time for your conclusions: try to give at least try key takeaways to your public, possibly as memorable as your vision.

-…and by the way…is there a possibility for shortening time to market and giving a try for an MVP? I know, easier if you are planning to sell a software, less feasible if your goal is opening a restaurant…but anyway always try to assess the feasibility of this point…

In evidenza

Corporate diplomacy: yet another (and not useful) attempt to label something that in facts companies don’t need.

corporate diplomacy

The business of writing books and papers about the subject labelled as “Corporate Diplomacy” is growing. Mainly they consist in a collection of generic and sometimes chaotic indications in order to grasp the new role that brands should play facing the challenges of changes, sometimes defined as catastrophic, imposed by globalization.

The standard topic is that companies, of every order and size, cannot avoid confronting themselves with international diplomacy and that they must take a sort of diplomatic standing in the social, environmental, and even political fields. In short, corporate diplomacy is exalted as a sort of cure-all for the social and environmental issues of the world, a breath of fresh air able to revitalize the archaic and inefficient diplomacy of the national states.

The general impression that is derived from the reading of such articles/books is that one is faced with the usual crude and repetitive ritual aimed, from time to time, at repainting/refreshing the conceptual facade of the strategic management “building” of a different color without however proposing any consistent or structural change or even suggesting new ideas.  It looks like corporate diplomacy is no more that some intriguing words, highlighting their uncertain conceptual consistency.

And yet there would be a need for new ideas, certainly, especially in the case of of the imminent and unspecified “cultural apocalypses” that await us.

Instead the well-known cases sometimes highlighted as examples of good/bed application of corporate diplomacy, and that concern f.i.companies like Starbucks, Dolce and Gabbana (f.i. the China-issue) etc, narrate situations of corporates in troubles with relationship with some of their stakeholders where in all probability it would have been much better to leverage existing categories, rather than blurring the minds of managers any further.

What indeed would differentiate the so called corporate diplomacy from the already existing (and still little used/adopted by so many companies) corporate social responsibility?

In this field, yes, there would be a need of some choral international action, aimed at defining some truly pervasive standards, unitary and in some cases even mandatory, of “non-financial reporting”, thanks to which the social/environmental balance sheets of companies could be improved, clearer, comparable and communicable outside. But this requires a real and sometimes unpopular commitment, as we know, where the effort lies not in imposing the “thinking of the brand” but to deeply discuss ethical problems and environmental issues with a common global approach between companies belonging to different geopolitical and social contexts, and with non-homogeneous and sometimes conflicting values and cultural paradigms.

The same is true for the evanescent proposed difference between corporate “diplomacy” and the already existing (and effective) techniques and themes of lobbying and public affairs, that can rely on a much more consistent and scientific framework, from all points of view, both practical and theoretical.

What need is there for other concepts?

corporare diplomacy 2

The behaviour of a company in a crisis situation is, or should be, regulated by communication techniques, crisis management and business continuity management: that these techniques and processes are currently well known and / or well applied by all companies is certainly an issue, but there is no particular need for adopting new categories.

On the other hand, there is a slight taste of ethical relativism that blows through the pages dedicated to corporate diplomacy.

Assumptions like:

  • Facts are no longer relevant, the paradigm of objective reality is over”: according to this vision, the pure verifiable facts count less than nothing, the only important thing is the prompt and sometimes opportunistic interpretation that company gives, leveraging stakeholder feelings not necessarily their rationality. What about the effort, this is what would be nowadays of even greater help and socio-cultural value, that some great companies of the past did to provide education, cultural preparation and argumentative skills to the communities with which they interacted? Nowadays the problem is to provide interpretative keys and reliable “certified” information sources based on facts, to foster people’s ability to build their own ideas and point of view, not the opposite.
  • Let’s move from stakeholder engagement to issue management“. That means in facts that instead of (wisely) paying attention to their stakeholders, of any kind, companies should now just “focus on those issues aimed to cause the greatest influence and impact on the business of the company itself “. It sounds a bit like providing companies with the perfect boy scout camping recipe, such as:

 a) concentrate (temporarily) on an issue (whatever you want, as long as it sounds interesting and it suits the business and is connected to your mission;

 ​b) influence on the same theme as much people you can on the globe regardless of the consistence of facts, but only on the basis of consumer’s emotionality, experience and perception: stakeholders, according to this vision, in the end do not exist, there is only a global audience there at firm’s disposal to be passively influenced by its communication techniques

c)when you have finished/you are satisfied with the results leave the topic and move on to something else.

This is probably the perfect recipe for a disaster.

Hopefully, companies would need just the opposite, f.i. studies and ideas aimed at characterizing organizations on the basis of a long-term, sustainable and consistent value system, deeply connected with real social and environmental needs of their communities and on a solid stakeholder dialogue.

This dialogue, as the principles of social responsibility clearly indicate, should always begin and end with people, however aggregated/represented.

This means that stakeholder should always come first and not the problems, as those are always defined in close relationship with the necessities/priorities and values of the former ones.

In evidenza

Entrepreneurship is enlightenment

enlightenment

On Christmas Eve light blossoms everywhere, even in the most unexpected places.  The same should be not just all around us, but in our spirits.

Entrepreneurship too has definitely something to do with light.

Entrepreneurship can a way of taking steps to find enlightenment: reconsidering the past without judgement for instance is a step in this direction, through moulding it into a repeatable experience that you can share with everyone.

But a step to enlightenment includes for sure looking for a positive environment: every good entrepreneur craves being in the kind of positive environment that creates firstly the incubator for their own growth and then for their firm.

And last but not least, looking at entrepreneurship as a road to enlightenment means being able to do other two important things.

The first is the ability to appreciate and enjoy details; while performing such an hard task as being an entrepreneur, every little light on your path is something worthy of your consideration: always accept it as a sign of confirmation that will help to keep you on your path.

The second is to cope with difficulties: where everybody sees failure, enlightenment pushes you to see endless possibilities, where everyone sees defeat, try to see understanding.  Light will lead you to come across as seeing the “silver lining” in anything. Pollyanna’s “glad game”, in the end wasn’t silly or mindless at all: teaches all of us to become aware. Aware of the potential of our optimism. If you stay tuned with light, (sometimes) magic happens.

Best wishes to all of you!

In evidenza

Doing business through listening

orecchio

We only see what we know” said once Goethe.

In entrepreneurial terms we do often the same. But, even more important we do often “listen only to what we like”. And, if we do, the chance of remaining what we are or, even worse, to fail, is very high.

Listening is entrepreneur’s very first friend, because is a powerful way of processing ideas, intuitions, emotions. Seeing sometimes can be immediate but also misleading, whereas listening can’t. It involves time and patience.

In conducting business, you’ll be busy with almost constant change management and with lots of people pretending their expectations to be taken into consideration by your business model. Both of these processes don’t involve at first speaking/pitching, but (apparently) the contrary: developing a deep listening attitude.

There are so many obstacles between a normal and an outstanding listening skill.

Many entrepreneurs and managers see their potential stakeholder like a mere on-demand moral support and reconfirmation service: as not so careful listeners they “download” from their words and messages only what they like and assume that counts as a reconfirmations of the ideas they already have.

More difficult, challenging and useful is being ready to analyse and listen even to those facts and consideration that at a first sight clearly contradict their own theories, being also prepared to change perspective for a while in observing reality.

So if as a human being and an entrepreneur you may learn to switch perspective and use for a while somebody else’s eye, your  listening skills and techiniques  instead are probably what more deeply personal and unique there is in your own identity. Nobody can listen the way you do nor you can ever do it in somebody else’s way. Therefore is so important and can make the difference for your startup project

Skilled listening, is a way of generating and testing new business ideas: it means in facts being able to pay attention to phenomena, eliminating background noise, and get the essential feedbacks from stakeholders, summarizing the content of their word. Mirroring, but in a creative way. (Then probably the better firms are the ones that are able not to mirror but to match, compensate and sometimes even counteract stakeholder messages, but that request time and starts anyway from a good listening phase)

In the end, that’s what a business plan represents: an entrepreneur is someone that find an original way of listening and then of creatively paraphrasing customers’ messages and statements in a way that both sound inspiring and reassuring.

What is essential is invisible to the eye”…but most of the times it can be well perceived by the ears!

 

In evidenza

Is it beautiful?

 

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Is there enough beauty in your firm?

What’s the real motivation behind starting a business up nowadays?

We all know is difficult, hardly successful, time consuming and sometimes lead us to ruthlessy confront with our weaknesses.

Is probably because a real entrepreneur is somehow like an archaeologist, relentlessy looking for some hidden beauty.

Beauty tends to feel like something that must be found in special places—like museums and galleries.

There is neither a ISO standard about beauty, nor a spreadsheet. But the very first question every entrepreneur should ask himself before starting a new business is exactly this one “Is it beautiful?”

Look at the market nowadays: every firms wants to be customer-centric, adapt as much as it can to customer taste, make customer happy: only beautiful things have this ability, because beauty is talking an universal language, neither classic nor modern, able to communicate with everyone. And it may represent a promise of happiness.

Therefore beauty may represent a success- detonator for your business, being able to open the way to happiness, because happiness in the end is strictly related with interaction with beauty: observing something beautiful, experiencing something beautiful, creating something beautiful.

Keep you customer in contact with beauty, and he will be certainly happy: the big seven factors commonly addressed as happiness markers, such as wealth, family relationships, career, friends, health, freedom, and personal values will come right after.

Moreover, most of startuppers look for an efficient organization, able to offer not just effective/efficient performances, but also able to easily adapt to circumstances (and, theoretically, to almost every customer’s request) and to be memorable: there again, beauty plays a role, because what they are really looking for is a way of designing beautiful processes.

Every process in the end is a flow chart, like every painting is made of colours, but there is a slight difference between the Mona Lisa and a forgery.  So, be creative in designing your business, even with the elements that seem “cold”: beauty is contagious so even a flyer, a visiting card, am office, a presentation, a logo, a packaging may represent an important fact.

bruco farfalla

Nowadays, there are firms that created in their organizational chart the role of Chief Happiness Officer, in its essence, an HR Manager with the task of engaging employees, motivating them and raising performance levels through the enhancement of their happiness level. We believe instead that putting managers in charge of searching/pretending from their resources non just a high performance but a beautiful performance, and training people to always look for some inspiring beauty all around them, even in the small details,  is even more important.

In evidenza

Making your pitching seem larger than life

 

piching larger than life

There are endless recipes in order to make the best out of your pitching experience.

Collecting the experience of some recent pitching events with startups, let’s go back to basics.

We won’t mention strategy for today, we want just to lay low. The devil is in the detail, especially in pitching, and you shouldn’t throw away the chance of making a good deal, or just putting the right foundation of your journey to success as an entrepreneur.

There are a few simple things that really can make the difference. Details, you’ll say. But they can make the difference: you know, exactly the difference between a room where it’s all quiet and everybody is listening and instead one where public complains or simply can’t care less (even worst!).

  1. Slide show: please be clear. Drop on the slide a few concepts to talk all around, but be merciless in eliminating the not useful concepts. A few words and crystal clear (sometimes with a skilful use of facts & figures) this is all you need as to why they should remember, in order to make it stick. In facts, what public read shouldn’t be what they listen to. Slides are most of the times too crowded, simply unreadable.

  2. Infrastructure: where are you planning to pitch? It will be organized for a large public, in a small room, or just a few persons? Try to have under control beforehand parameters like: a) distance to public, b) facilities available in the room (fi. Kind of videowall) c) pitching indoor/outdoor d) presentations file format (ppt, prezi, etc). Pitching environment is important, sometimes decisive.

  3. Always respect time: is always one extra point gained for your pitching. Time keeping means respect for the audience, respect the following pitchers and…for yourself. In facts a god pitcher is a superb listener. So having time left means having time to answer questions and interact with public. People identifies (and recalls later on) much more with contents and concepts connected with Q&A moments. Because Q&A is like a game, where your ability to communicate and winging it can also be tested.

  4. The power of a word, the power of your silence: as well as for point 1, don’t fill in your speech with too many words. The time you should give to the audience to adapt to your way of thinking (especially if you are discussing some difficult/highly specialistic subject and/or about some radical innovation) is directly proportional to the magnitude of your innovation. So don’t forget to use short and clear sentences (especially if you are pitching in a noisy or crowded environment) and use frequent effect pausing (that can be used also to test the effect of your words on the audience).

  5. Talk, looking everybody in their eyes, don’t read.

  6. The next 48 hrs: if you were able to break the ice and establish promising contacts with someone, don’t forget to write an e-mail within 48 hrs, providing further information about you and/or about some of the issues you have been asked about

In evidenza

Disruption, fintech and CSR the 3 mantras for islamic finance

wibc second day

 

Convened by Middle East Global Advisors – a leading financial intelligence platform facilitating the development of knowledge-based economies in the MENASEA markets and in strategic partnership with the Central Bank of Bahrain, the forum is spurring a series of discussions focusing on “Islamic Finance & Sustainable Economic Growth in the Age of Disruption”, a theme that resonates with the conference’s steady vision to serve as a definitive check point for the global Islamic finance and banking industry.

Islamic finance may play an outstanding role in global economy especially if able to leave its comfort zone, with the help of new technologies in front end (improving customer experience) and most of all in backoffice processes.

Showcasing his support for Islamic finance entities to thrive and grow globally and stressing on the way forward for the industry, the Governor of Central Bank of Bahrain, in his address mentioned, “Islamic finance has followed a fragmented growth pattern since the start with various countries in the Middle East and South East Asia taking the lead. These country specific models have achieved reasonable success as measured by the share of Islamic finance in the respective markets. I would like to argue, however, that the reduced pace of growth suggests that we cannot hope for a new growth paradigm while maintaining the status quo. If the developments in the conventional finance industry are any indicator, it is reasonable to expect that regional and global cooperation can open new doors for the Islamic finance sector. The magic of such global cooperation works when some pre-requisites are in place, namely, leadership, standardization, good governance and risk management & compliance.”

“Shari’ah standards, accounting standards, prudential standards and best market practices, all need to be developed for the Islamic finance industry with the global audience in mind. AAOIFI has been doing excellent work on Shari’ah and accounting standards while Islamic Financial Services Board (IFSB) has developed risk management and capital adequacy standards which conform to global best practices. International Islamic Financial Market (IIFM) has made valuable contribution towards standardizing money and capital market contracts as well as financing contracts. The recent endorsement by the IMF of the IFSB’s proposed core principles for Islamic finance regulation and their assessment methodology for financial sector assessments is a great news for the global acceptance of Islamic finance. What we need now is to convince regulators and market players to adopt AAOIFI, IFSB and IIFM standards in their respective markets”, added Mr. Maraj stressing on the need for standardization to enable global growth.

Commenting on the changing face of financial services due to the advent of digitization, Dr. Sami Al-Suwailem, Head of Financial Product Development Centre, Islamic Research & Training Institute, Islamic Development Bank in his keynote address stated, “The size of e-commerce is about three times the size of the Islamic financial industry. This means that there is an ample room for the industry to invest and to participate in the digital revolution. Moreover, e-commerce will be a very good channel to manage the liquidity of Islamic banks. This is a challenge that has long been waiting for a solution. E-commerce seems to be a promising sphere. With the fintech revolution, online sales can seamlessly meet the requirement of Islamic finance. If Islamic banks invest in this area, they will be able potentially to reap lucrative returns from a growing large sector, manage their liquidly efficiently, and participate in real economic growth and development.”

The conference also played host to an exclusive interview of H.E. Khalid Al Rumaihi, Chief Executive, Bahrain Economic Development Board, which focused on emerging projects and financing, the value added tax which will be implemented in the Kingdom in addition to the benefits and risks of digitization.

H.E. Khalid Al Rumaihi discussed the Government’s integral role in supporting the continuous development of the local economy; encouraging constant collaboration between the public and private sectors, as well as creating an ecosystem that is conductive to the success of startups and entrepreneurs, in order to ensure the Kingdom maintains its lead at the forefront of its competitors in digital transformation across industries. Mr. Al Rumaihi also mentioned the key milestones achieved by the GCC countries during the past three decades, and how they have employed the bilateral cooperation as a factor to promote brotherly countries and unite efforts to succeed in the initiatives and plans set in this regard.

Ahead of the panel session on economic growth & sustainable finance, Adnan Ahmed Yousif, President & Chief Executive, Al Baraka Banking Group, said, “The World Islamic Banking Conference, has, over the last 25 years, established itself as a key global forum for in-depth discussions on the facets of the continued global growth in Islamic finance. The Islamic Financial Services industry has shown tremendous progress as one of the fastest growing asset classes in the world. The industry continues to expand in many emerging and advanced markets and introduce new standards that should further help develop products and attract investors. The industry’s global appeal continues to grow and attract remarkable attention, including from the UK, Europe, Asia, Africa and North America. In order to for Islamic banks to expand their geographical footprints further over the coming years, they must be able to compete more effectively and tackle a number of key challenges facing the industry, including delivering cost efficiencies, building greater talent pools, enhancing corporate governance; leveraging digitization, delivering innovative products that meet genuine market needs; and ensuring risk management systems are up to par. For the Islamic finance industry to build a solid foundation for the next phase of international growth, the industry must undergo transformation in a number of key areas. The 25th Anniversary World Islamic Banking Conference (WIBC 2018) is a key platform for industry leaders to put a spotlight on the challenges, innovations, latest developments and technological solutions essential for further growth of the global Islamic banking and finance sector.”

The conference also saw a Keynote Address by Aziz Elkhyari, Head of Business Development, Casablanca Finance City Authority who spoke about Fostering the development of Islamic finance in Africa and the role of financial centers. This was followed by the joint launch of Casablanca Finance City (CFC)-Thomson Reuters Report – Islamic Finance in Africa: The upcoming frontier that provides an industry landscape of Islamic finance in African countries with an overview of the industry development in 5 African countries including Morocco.

The conference proved to be the ideal launchpad for a number of key financial intelligence reports and also saw the launch of The Global Report on Islamic Finance – 2018: The role of Islamic finance in financing long-term investments by Islamic Development Bank that highlights how Islamic finance could help mobilize long-term funding for development programs.

Other key highlights from the day include the panel discussions focusing on economic growth and sustainable finance, the Fintech Panel on the Digitization Journey of a Global Bank and the Region Round Table focusing on Africa. Leading industry experts analyzed the challenges at hand and focused on coming up with effective suggestions with the ultimate aim of developing a convergence roadmap for the Islamic Finance industry at large.

In evidenza

Mismanagement 2: some further antidote

 

 

torre d'avorio

 

Due to the interest on the previous article (Mismanagement) here some further clarification and (hopefully) useful “mismanagement predictors

  1. Communication: many ISO standards and reporting guidelines too are concerned with concepts like “stakeholder engagement”/ “communicating with stakeholder”. Make sure that managers into your organization do not operate in vacuum: management is certainly made of a personal vision and some important beliefs, but is mainly about keeping a constant contact with reality, and performing as many “reality checks” as possible. Therefore, in this field, the sooner the better; introducing and using such standard as ISO 9001:2015; ISO/IEC 20000 and guidance or reporting guidelines such as ISO 26001 or GRI (https://www.globalreporting.org/Pages/default.aspx) forces even the most reluctant manager to have an (official) dialogue with representatives of the “real “ world. To hear their voice, to answer their questions, makes more difficult mismanagement and unrealistic or just selfish behaviour to take place. Keep also in mind that the above mentioned standards are based on a widespread concept of sustainability: it means getting used to evaluate managers not just for their immediate results, but also based on how sustainable those results are;
  2. Training: training means empowering people; it means also knowledge sharing: being most of the companies nowadays based on knowledge, having in place an advanced training program is certainly a powerful message. It means that your company is creating the preconditions for reducing information asymmetry between different organizational levels, and, most important, the preconditions for supporting change through the creation of a new (internal) generation of managers. Generally speaking, organizations that support individual change show aòso a much better overall organizational readiness to change at all levels;
  3. Permeability: sometimes, an organization loses the capacity of timely transmitting the right signals through all the different organizational levels, like it happens in a body when nerves get damaged. That equals to slowly insulating managers in an ivory tower. Mismanagement can therefore occur as a result of a not intentional behaviour, but instead of an organizational pathology that drastically reduces firm’s sensitivity for changing environmental conditions;
  4. Customers: in many innovative business models, customer is CEO, being able to determine product/service changes, influence company’s marketing and communication, etc. A possible antidote to mismanagement is to renovate from time to time the extensive survey on “customer’s needs/voice” that surely every founder performed at the very beginning of its entrepreneurial journey. Just because you were once able to listen carefully to your customers, it doesn’t necessarily mean that now it has to be always the other way around (customers passively adopting your smart product/services);
  5. Suppliers: yes, suppliers are very important partners. Sometimes even irreplaceable. But suppliers are firm too, and exactly like clusters and networks of firms can suffer the effects of mismanagement resulting in an irrational or dysfunctional decision-making outcome that discourages critical evaluation of alternative viewpoints. So from time to time, experiencing and testing new approaches, experimenting new partners starting from non-critical processes can provide to the management an healthy internal benchmark. In fact, not always relying on the usual solutions is a good antidote to mismanagement too.
  6. Organizational climate: Yes, is very important to enjoy a positive organizational climate. Everybody knows that. But a two things should be stressed more than others:

a)The importance of a mistake. The ability of management to address and communicate with examples, because it seems that especially managers are afraid to set the right example by openly admitting they did something wrong (not understanding that there is much more to learn from a mistake than from a success), but if they do, they develop antibodies to mismanagement and so does the organizations they lead, because they are permitting a person to do things incorrectly or make errors of judgment without consequences, empowering themselves and learning how to take and handle risks. Mismanagement occurs where and when an organization is not taking risks anymore;

b) Organizational Forgiveness: it’s an important antidote, because it means being able to accept conflict, accept different point of views, leading the organization objectively and without taking revenge on those standing on the other side of an issue and opposing a change.