Richard Straub is Director of EU Affairs and Corporate Services at EFMD (European Foundation for Management Development), an international membership organisation based in Brussels. The following was first publish on Blogactiv.
"Sociologists characterise 20th-century society as a society with fundamentally new characteristics compared with previous historical societies. It is a society of organisations. Organisations have pervaded all parts of our lives. They range from business organisations, to education, hospitals, semi-public and public organisations, NPOs, and so on. They are the organs of modern society – hence society is dependent on their quality. In order to function they need to have means to achieve their purpose.
This is where management comes in – without proper management the organisations cannot achieve their purpose. It is quite obvious for businesses, but equally clear for education institutions, hospitals, research organisations and public sector bodies.
Against a backdrop of the modern society of organisations, the systematic study of management started in the early part of the 20th century and saw a notable acceleration in the post-war years. University-based business schools and independent institutions sprang up everywhere leading today to a mind-boggling number of more the 12,000 globally. Large businesses were the natural place to start with education and the systematic application of management as their increasing scale, scope and complexity required specific skills to survive and thrive in competitive markets.
The emerging discipline of management included various elements such as operations, human resources, strategy, leadership, innovation and entrepreneurship. General management and increasingly specialised disciplines took on an accelerated development, which can be measured by the number of books, scientific articles and management conferences. Besides a few fads a huge body of useful knowledge (ancient Greek - Techne) was produced that made management an essential social technology. Yet outside business the application of management knowledge was rather limited, to say the least.
Fast forward to today’s situation: In order to get back to sustainable growth, high performing organisations are needed in all parts of society. Even though budgets are being cut, higher and better outputs from organisations are required. “More for less” is the mantra. While large businesses are overzealous in cost cutting (including human resources), non-business organisations and the public sector have not yet fully woken up to this new challenge.
The latter introduces at best formal rules to reduce civil servants over time (e.g. hire only one for two leavers). However, the creation of more and new value with less resource is the mandate for the future. This means that organisations need to be better managed towards achieving a higher degree of value creation by innovating in all fields of their activity: providing products and services that meet the needs of customers and hence of society but also innovating in the way they operate e.g. by introducing new HR practises taking into account the multigenerational workforce, by implementing new ways to develop transformational leaders with strong entrepreneurial capacity, by implementing new tools for creating and sharing knowledge etc.
When we look at the specific subject of research and innovation – the translation of research into innovation is hardly perceived as a management challenge. It is somehow assumed that good research will lead to good innovation. However, this is clearly not the case as the conversion rate of R&D into innovation is very low – according to various studies.
Can this rate be improved by better management practises? I certainly believe it can. There is a very significant body of knowledge in this field – good practises and results from broad based empirical research. As an example – open innovation has been emerging as a key subject during the last 10 years. MIT and other universities have done significant work to drill deep into this subject, and a group of companies have founded the “Open Innovation Policy and Strategy Group” with the European Commission. However, this is currently an isolated initiative that demonstrates the need for a more comprehensive approach.
In his new book “The Learning Curve” Santiago Iniguez, the dean of the Spanish Business School Instituto de Empresa expressed it this way: ‘What the world needs now is good entrepreneurs, good managers, and good business leaders. I believe the best antidote to intolerance or the clash of cultures or poor foreign policies, is to develop good managers, create new businesses, innovate and generate value and wealth at all levels of society.’
Hence the following specific topics are proposed for future EFMD EU Affairs activities to react/respond to:
- Is management education and research a blind spot in European policy?
- Should this be addressed and if so what are the priorities?
- How can management capabilities for innovation and entrepreneurship be better embedded in existing programmes?
- What would the benefits be of large-scale cooperation in Europe on these subject (along the lines of “technology platforms”)?
- How could the subject of management research and education be included in the Innovation Union?"