Creation of Invisible Values in Enterprises

The Motivation: factor 9 in EBIT

We all know how different the productivity of teams can be. Tom DeMarco analyzed software development teams and identified teams who are a factor 3 more productive than average and teams who are a factor 3 less productive than average. In other words, he observed a span of a factor 9 (!) for different productivity.

This fact is not only observed in the field of software engineering but almost everywhere where knowledge workers are working. The more geographically distributed the teams are the more significant are the differences in their productivity.

Translated into money this means that even if you pay the same hourly rate for two different teams, one of them might be worth only 22€/h/person while the other one is worth 200€/h/person. Up to now I have not met any CEO or CFO who do not care, if their EBIT is a factor 9 less than possible.

The Invisible Value

A lot of research is done to analyze the reasons for different productivity and how to create values that improve the productivity. Most of those values are visible values like the implementation of processes and tools. On the other hand it is well-known that invisible values like trust relationships between (geographically distributed) teams members increase significantly the productivity.

The Research Questions

  • Categorize invisible values in a company (e.g. trust culture, cross-divisional cooperation culture, culture of mutual respect, openness…).
  • How to strategically evaluate which invisible values are most important for the company in the current situation?
  • Strategies for establishing or leveraging those desired invisible values in a company.
  • Invisible values are usually difficult to measure. However, what are the possible metrics – or at least measurable indicators – which help to demonstrate the progress?

See also: “Carrier Process for Cultural Change Management”
and “Due Diligence of Enterprise Culture”

Please, let me know if you are working in this field or if you plan to work in this field or if you know about already existing research in this field.

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Carrier Processes for Cultural Change Management

The situation:

You want to change the enterprise culture.
Typical examples:

  • from internal competition/silos to a cross-organizational cooperation culture;
  • from a not-invented-here culture to a proudly-found-elsewhere culture (from pure internal innovation towards open innovation).

The approach

Some companies believe that cultural change can be implemented solely with a communication initiative (typically driven by the corporate communication department and the top management). Such communication initiatives often achieve some awareness for the desired change but seldom lead directly to the desired change.

The more an initiative leads to a change of the daily operative behavior, the more sustainable is the change (in other words: if the communication initiatives does not change the behavior, why should suddenly the behavior change after the communication initiative is finished?). Communication initiatives are important and necessary but in most cases not sufficient.

What is needed is what I call a Carrier Process for change:

Carrier Process for Cultural Change Management

A Carrier Process for Cultural Change Management is a process which is already integrated into the operative business and can be adapted in order to support the strategic goal of the desired cultural change (if it is not already integrated or not even implemented, the effort and the risk to fail is higher – however it is not impossible).

Example:

  • Innovation Management/Technology Management/Knowledge Management is usually already in place but can be adapted in order to operate as a Carrier Process for the desired change (see for example the role of Siemens TechnoWeb for their cultural change process)

Research Questions

  • The carrier-change-fit: which Carrier Processes are appropriate for which change goals? Develop a Carrier Processes framework.
  • Case studies of Carrier Processes for cultural change management: success factors, speed of change (ideally compared to a similar situation without Carrier Process).
  • Is in some cases a completely hidden change management (without communicating the change goal to the employees) – just via strategically implemented Carrier Processes more effective?

Please, let me know if you are working in this field or if you plan to work in this field or if you know about already existing research in this field.

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TechnoWeb publications

Some people are asking me, where to get information about Siemens TechnoWeb (a Siemens-internal Social Media application for networking technology knowledge of Siemens employees):

TechnoWeb: find people to get answers

Here the collection of some sources:

You can find a case study about TechnoWeb in the book contribution:
Mörl, S., Heiss, M. & Richter, A.: Siemens: Wissensvernetzung mit TechnoWeb 2.0. In P. Schubert & M. Koch, eds. Wettbewerbsfaktor Business Software. Hanser 2011, pp. 171-191.


You can find slides about TechnoWeb at Slideshare at
http://www.slideshare.net/heisss e.g.:

The blog entry about “Value Steering of Social Media” describes the design principle behind TechnoWeb.

You can find an internal motivation video at YouTube:

and you can find published scientific papers about TechnoWeb, e.g.:

  • Acquah, I. N., Wiener, C., Heiss, M., Mayerdorfer, T., Langen, M.: Responsible Corporate Problem Solving – a Siemens Case Study with TechnoWeb 2.0. Proceedings of the IEEE International Technology Management Conference (ITMC 2013), The Hague, NL, June 2013.
  • Wiener, C., Acquah, I. N., Heiss, M., Mayerdorfer, T., Langen, M., Kammergruber, W.C.: Targeting the Right Crowd for Corporate Problem Solving – a Siemens Case Study with TechnoWeb 2.0. Proceedings of the IEEE International Technology Management Conference (ITMC 2012), Dallas, TX, June 2012, pp. 239-247. Available at IEEEXplore
  • Langen, M., Heiss, M., Mayerdorfer, T., Kammergruber, W. C.: „Intelligent Message Distribution in Corporate Expert Communities“: Proceedings of the International ICE Conference on Engineering, Technology and Innovation, pp.540-548, Munich, June 2012. Available at IEEEXplore
  • Schneckenberg, D., Heiss, M.: Moving to an Open Innovation Culture – The Case of Siemens. In P. Adollfson, O. Bergström, B. Czarniawska, U. Erikkson-Zetterquist, A. Styhre, 27th European Group for Organisational Studies Colloquium, 7-9 July 2011 (p. 215). Gothenburg: European Group for Organisational Studies.
  • Schneckenberg, D. & Heiss, M.: Open Innovation and Knowledge Networking @ Siemens. In K.R.E. Huinzingh, S. Conn & I. Biltran (Eds.), XXII International Society for Professional Innovation Management Conference Proceedings, 12-15 June 2011 (p. 50). Hamburg: International Society for Professional Innovation Management. ISBN: 978-952-265-092-4
  • Glatz, G., Ackerlauer, H., Heiss, M., and Damian D.: Impact of knowledge networking and organizational learning on the performance of organizations. Proceedings of the IEEE International Engineering Management Conference IEMC 2007, Texas, USA.
  • Wölbitsch, M., Heiss, M., Mühlbacher, J.: Auswirkungen der virtuellen Wissensvernetzung auf die Post-Merger Integration – Fallstudie der integrativen Wirkung in einer außergewöhnlichen Unternehmenssituation. Buchbeitrag in “Geteiltes Wissen ist doppeltes Wissen!” M. Bentele, R. Hochreiter, H. Krcmar, M. Weber (Hrsg.), KnowTech 2009, ISBN 978-3-7723-1470-4, pp. 671-679.
  • Käfer, G., Heiss, M.: Wissensnetze als Basis für Enterprise 2.0 – Ein Erfahrungsbericht der Siemens AG aus 10 Jahren Wissensvernetzung als Basis für die Einführung von Enterprise 2.0. Buchbeitrag in “Geteiltes Wissen ist doppeltes Wissen!” M. Bentele, R. Hochreiter, H. Krcmar, M. Weber (Hrsg.), KnowTech 2009, ISBN 978-3-7723-1470-4, pp. 201-205
  • Mikulovic, V.; Heiss, M.; Herbsleb, J.D.: Practices and Supporting Structures for Mature Inquiry Culture in Distributed Software Development Projects. Proceedings of The IEEE International Conference on Global Software Engineering, 2006. ICGSE ’06. Oct. 2006, pp.245 – 246
  • Mikulovic, V., and Heiss, M.: “How do I know what I have to do?” – The Role of the Inquiry Culture in Requirements Communication for Distributed Software Development Projects. Proceedings of the IEEE/ACM International Conference on Software Engineering ICSE 2006, Shanghai, China, May 20-28, 2006.
  • Heiss, M., Stöckl, S., and Hausknotz C.: The Bottom-Up/Top-Down-Pattern: An Organizational Pattern for a Balanced Management System. Proceedings of the IEEE International Engineering Management Conference (IEMC 2004), Singapure, October 2004.
  • Kubasa, G. and Heiss, M.: Distributed Face-to-Face Communication in Bottom-up Driven Technology Management – A Model for Optimizing Communication Topologies. Proceedings of the IEEE International Engineering Management Conference (IEMC 2002), Cambridge U.K., August 19-20, 2002, ISBN 0-7803-7385-5, pp. 234-238.
  • Ackerlauer, H. Heiss, M.: Breeding Technologies Within Expert Networks as a Balanced Technology Management Method. WSEAS TRANSACTIONS ON BUSINESS AND ECONOMICS 2006, VOL 3; pp. 245-252, WSEAS Press, Greece 2006. ISSN             1109-9526
  • Heiss, M. and Jankowsky, J.: The Technology Tree Concept – an Evolutionary Approach to Technology Management in a Rapidly Changing Market. Proceedings of the IEEE International Engineering Management Conference (IEMC 2001), Albany, N.Y., Oktober 7-9, 2001, ISBN 0-7803-7260-3, pp. 37-43. (This is the first paper about TechnoWeb)
Investment analysts about TechnoWeb:

The new intelligent Urgent Request channeling algorithmus


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Management of Complexity

Some time ago I did some research about managing of complex systems. The results were published at the M.I.T. Europe Conference.

Neverthless, I am convinced that there is some important aspect missing in this research. The research concentrated to collect straight forward engineering methods, most of them are already known as state-of-the-art methods in software engineering.

We know that some people are better in managing complexity than others. I am convinced that you can observe these different skills in manageging complexity also if both would have exactly the same knowledge of the above mentioned straight forward engineering methods.

Some people have just these ingenious skills to handle complexity better than others.

The research question:

What are these “ingenious skills to handle complexity”? Why are some people better in manageing complexity than others – even if they have the same explicit knowledge? What kind of implicit or tacid knowledge do you need to be better?


Some ideas what could make a difference

  • not to be afraid of complex systems (never having enough information to decide on a complete analyses of the information), take it as it is instead of trying to divide it in non-complex systems (which is per definition impossible)
  • having the skill to sense behavior of the system (which other people do not see)
  • having the skill to connect new obervations with old experiences on a unconscious bases and to derive decisions – what I call an experience based gut feeling.

Sounds quite esoteric. Nevertheless, I am convinced that research in this field would deliver non-esoteric results. The interviews which I did were solely with engineers as the focus of my research was managing complexity in complex technical systems. Now I would include also managers (or better: leaders) as interview partners. A large organization is also a complex system and these interview would add some different point of view. 

Hints to existing research or own ideas or approaches are welcome!

Managing Complexity

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Due Diligence of Enterprise Culture

If I like to buy another company (with mainly knowledge workers) I would be interested to know their productivity factor of their enterprise culture. I would pay more for a company with an enterprise culture which leads to a productivity of 200% (related to average companies) compared to a company with an enterprise culture which leads to a productivity of 50% (related to average companies).

This productivity potential due to the enterprise culture cannot be solely derived from commercial data, as the commercial situation of the company depends also on many other factors (e.g. their position in the market).

The question is:

  • How can you measure the economic value of an Enterprise culture?
  • How much would you pay more for a company depending on this metric?
  • Is the productivity factor of an enterprise culture (at least in theory) a proper metric of the culture. Nevertheless, how do measure the productivity factor?
  • People CMM might lead you to a set of indicators for an enterprise culture, but does not really measure the business impact of these indicators. Metrics like function points are solely focussing of resources input and function output of the current (or past) work, but do not evaluate the productivity potential of the employees if the market and therefore usually their kind of work changes. Is a combination of both the right answer?
  • Could  a knowledge networking and collaboration index be developed which is the right answer to my question?
  • Trust is one of the most important productivity drivers. How can you measure the trust in a company?

Does trust pay off?

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Hello world!

In this blog I am posting research questions which are of interest for me.

Feel free to

  • comment them or to
  • cite reasearch papers which are already dealing with this topic

Best regards,

Michael Heiss

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