1. Management 2.0
Cooperation for sustainable development of companies
23.06.2009 ® Friedag 2009 1

2. Herwig R. Friedag
Born in 1950, Degree in National Economics
Consultant focusing on:
 Implementation of Balanced Scorecard
 Workshops on Balanced Scorecard
 Head of the PR committee at ICV (ICA)
 Visiting lecturer at Humboldt University in Berlin
Hobbies: Outdoor activities, Volleyball,
Dr. Herwig R. Friedag
Bicycle tours, Sailing Friedag Consult
Beskidenstr. 33, D 14129 Berlin
Fon +49 30 80 40 40 00
Fax +49 30 80 40 40 01
consult @ friedag.com
www.friedag.com
23.06.2009 ® Friedag 2009 2

3. Publications
2003
2004
2001
1999, 2000, 2002
2009
2000, 2002, 2004
Total number of copies: >70.000 2002, 2003, 2005
in CZ, GER, FIN, POL, RUS Friedag / Schmidt / Schwerk SS 2009 2005 3

4. Cooperation for sustainable development of companies
Management 2.0
Cooperation for a sustainable „successful“ business
activity
1. Definition of Management 2.0
2. Aspects of Management 2.0
3. Don´t worry, be happy – Go the “Management 2.0“ way
23.06.2009 ® Friedag 2009 4

5. Cooperation for sustainable development of companies
Management 2.0
Cooperation for a sustainable „successful“ business activity
1. Definition of Management 2.0
2. Aspects of Management 2.0
3. Don´t worry, be happy – Go the “Management 2.0“ way
23.06.2009 ® Friedag 2009 5

6. Definition of Management 2.0
How can a controller make the manager happy?
Markets and companies always experience ups and - as just now - downs
DAX- / Dow Jones-development in 2008/2009
?
23.06.2009 ® Friedag 2009 6

7. Definition of Management 2.0
Sustainable development of companies
Which business model will establish itself?
 Shareholder-orientation:
- short-term goal orientation
- profit maximisation is topmost postulate
 Stakeholder-orientation:
- balanced orientation to all relevant stakeholders:
customers
employees
production-partners
investors
- The focus is on the sustainable profitability of the company and to
benefit the society
- Reputation is priority task for the management
23.06.2009 ® Friedag 2009 8

8. Definition of Management 2.0
Sustainable development of companies
Difficult times offer good chances:
It doesn‘t matter what the current environment is. What is more
important is whether we are better than our competitors:
 Serve remaining customer needs faster and with better service
 Build closer relationship to customers and suppliers
 Set tied capital free over the whole supply chain
To be better, you should work with
Management 2.0:
Cooperation
23.06.2009 ® Friedag 2009 10

9. Definition of Management 2.0
What is Management 2.0?
Web-Generations
Web 1.0 1.5 2.0
Orientation Technology Advertising Community
Users Experts Commerce all
Focus Organisation Click-rates Interaction
Effect Rationalisation Information Socialisation
Approach Centralisation Quantification Qualification
Source: Smoke&Mirrors, Agency for Online-Communication
Web 2.0: Users themselves create, edit and distribute contents. Contents
are not anymore centralised by big media enterprises but
compiled by a multitude of users und distributed through
Internet. In addition they get linked with each other by means of
social software (Wikipedia)
23.06.2009 ® Friedag 2009 11

10. Definition of Management 2.0
What is Management 2.0?
Management-Generations
Management 1.0 1.5 2.0
Orientation Product Capital Community
Users Experts Financial world Society
Focus Organisation Interest Mutual benefit
Effect Cost degression Merger Sustainability
Approach Rationalisation Utilisation Cooperation
Management 2.0: By implementing cooperation
 Achieve improvement of the company reputation,
 generate benefit for all stakeholders to secure
sustainable profitability of the company
23.06.2009 ® Friedag 2009 12

11. Definition of Management 2.0
Management 2.0 -
Responsibility for sustainable development of companies:
Cooperation: the basis for a successful business activity
Management 2.0:
Cooperation
23.06.2009 ® Friedag 2009 13

12. Coming together is a beginning,
Keeping together is progress,
Working together is success.
___________________
Henry Ford
23.06.2009 ® Friedag 2009 14

13. Cooperation for sustainable development of companies
Management 2.0
Cooperation for a sustainable „successful“ business activity
1. Definition of Management 2.0
2. Aspects of Management 2.0
3. Don´t worry, be happy – Go the “Management 2.0“ way
23.06.2009 ® Friedag 2009 15

14. Aspects of Management 2.0
1. Goals
– shared view for the journey together
2. Organisation
– balance of stakeholders interests
3. Values
– internal and external appreciation
4. Structures
– scope for changes (redundancy)
5. Culture
– competition and mistakes to get better
6. Responsibility
– results orientation of all
7. Communication
– open communication
23.06.2009 ® Friedag 2009 16

15. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
1. Goals – shared view for the journey together
 Companies take their social responsibility seriously
Companies aim to generate benefits for society (CR or CSR)
A requirement for that is sustainable profitability and adequate rate
of return of the employed financial and intellectual capital
23.06.2009 ® Friedag 2009 17

16. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
1. Goals – shared view for the journey together
 Companies take their social responsibility seriously
 All relevant stakeholders are considered in the process of setting
the goals
- Every employee should know the company goals and ask himself
„How can I contribute to the achievement of those goals?“ –
because:
- Customers expect competent und timely decisions:
 In b2b-business usually only the managers are customer-
oriented – for most employees who are not in Sales customer-
orientation is an abstract concept
 In b2c-business on the other hand
usually only the employees in Sales
have customer contact – most managers
have little practical experience with
customers
23.06.2009 ® Friedag 2009 18

17. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
1. Goals – shared view for the journey together
 Companies take their social responsibility seriously
 All relevant stakeholders are considered
 Lessons for the management:
Value orientation und creativity gain in importance
 Lateral thinker have different views
 Learn from the past, think of the future
 Strategies are not for ever
- review and revise annually the strategic assumptions
- if necessary the strategy must be revised during the year
23.06.2009 ® Friedag 2009 19

18. Aspects of Management 2.0
1. Goals
– shared view for the journey together
2. Organisation
– balance of stakeholders interests
3. Values
– internal and external appreciation
4. Structures
– scope for changes (redundancy)
5. Culture
– competition and mistakes to get better
6. Responsibility
– results orientation of all
7. Communication
– open communication
23.06.2009 ® Friedag 2009 20

19. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
2. Organisation – balance of stakeholders interests
 Strategic topics at all company levels are:
- Innovation at all levels in the company,
- Commitment of all employees / stakeholders and
- Avoidance of wastage through goal-oriented processes
23.06.2009 ® Friedag 2009 21

20. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
2. Organisation – balance of stakeholders interests
 Strategic topics are innovation, commitment and wastage
 How can we develop a spirit of cooperation in the company?
 Internal markets for resources, talents and ideas
- identify and employ hidden talents
 Do we sell our customers
products or benefits?
 Internal performance-
agreements are instrument
for cooperative teamwork
23.06.2009 ® Friedag 2009 23

21. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
2. Organisation – balance of stakeholders interests
 Strategische Themen sind Innovation, Engagement und
Verschwendung
 Wie schaffen wir im Unternehmen ein Klima für Kooperation ?
 Interne Märkte für Ressourcen, Talente und Ideen
- verborgene Talente erkennen und nutzen
 Interne Leistungsvereinbarungen als Instrument kooperativer
Zusammenarbeit
 Verkaufen wir dem Kunden ein Produkt oder einen Nutzen?
 Do we compare us with our competitors?
23.06.2009 ® Friedag 2009 24

22. Aspects of Management 2.0
1. Goals
– shared view for the journey together
2. Organisation
– balance of stakeholders interests
3. Values
– internal and external appreciation
4. Structures
– scope for changes (redundancy)
5. Culture
– competition and mistakes to get better
6. Responsibility
– results orientation of all
7. Communication
– open communication
23.06.2009 ® Friedag 2009 25

23. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
3. Values – internal and external appreciation
 Trust is the basis for cooperative business activity
- control is good, trust is better
- trust is based on values
 Less control by the managers and open culture of all
- everybody looks after
results in his team
- mistakes are seen as
opportunity to learn
23.06.2009 ® Friedag 2009 26

24. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
3. Values – internal and external appreciation
 Trust is the basis for cooperative business activity
- control is good, trust is better
- trust is based on values
 No control by the managers but open culture of all
- everybody looks after results in his team
- mistakes are seen as opportunity to learn
 Justified trust is more efficient and cost-saving than everyday life
with control mechanisms
 Appreciation is the base – external and internal
 Price is the measure of the customer appreciation of the seller,
that means that all employees must make efforts to win customer
appreciation
 Appreciation, both external and internal, is the basis for cooperative
teamwork
 Continual work on establishing a shared value structure is time
consuming, but is feasible ® Friedag 2009
23.06.2009 27

25. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
3. Values – internal and external appreciation
 Both customer and supplier are partners in the process – that is a
win-win-situation for all partners and a prerequisite for an effective
cooperation
 Incentive systems with long-term effect
 investor interests are not only for a quarter
 for managers and also employees perennial,
long term programmes, based on cash flow
 Why not to offer incentive systems to customers and suppliers as
well?
23.06.2009 ® Friedag 2009 28

26. Aspects of Management 2.0
1. Goals
– shared view for the journey together
2. Organisation
– balance of stakeholders interests
3. Values
– internal and external appreciation
4. Structures
–scope for changes (redundancy)
5. Culture
– competition and mistakes to get better
6. Responsibility
– results orientation of all
7. Communication
– open communication
23.06.2009 ® Friedag 2009 30

27. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
4. Structures – adapted to changes
 Hierarchy is less effective –
Instructions and obedience hinder innovation und spontaneity
 Small independent entities are more
flexible than bigger ones –
modern companies are fast,
flexible and creative
 The management coordinate/moderate
co-operation of local entities
 Networks overcome boundaries
- Involvement of customers and suppliers
- Promotion of in-house networks
 Compromises have many winners
23.06.2009 ® Friedag 2009 31

28. Aspects of Management 2.0
1. Goals
– shared view for the journey together
2. Organisation
– balance of stakeholders interests
3. Values
– internal and external appreciation
4. Structures
– scope for changes (redundancy)
5. Culture
– competition and mistakes to get better
6. Responsibility
– results orientation of all
7. Communication
– open communication
23.06.2009 ® Friedag 2009 32

29. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
5. Culture – competition and mistakes to get better
 Managers concentrate on presentation of values and strategies
- shared values facilitate the implementation of the strategy
- with Balanced Scorecard everybody is aware of the corporate
strategy
 Diversity, contradiction and variety move
the company forward
- limited views do not live up to the reality
 Mistakes should be seen and used as part
of the learning process – do not accuse
those who have made and admitted mistakes
 Do we work with the right ratios?
- every innovation can be calculated
- good managers take responsibility
for innovation
23.06.2009 ® Friedag 2009 33

30. Aspects of Management 2.0
1. Goals
– shared view for the journey together
2. Organisation
– balance of stakeholders interests
3. Values
– internal and external appreciation
4. Structures
–scope for changes (redundancy)
5. Cultur e
– competition and mistakes to get better
6. Responsibility
– results orientation of all
7. Communication
– open communication
23.06.2009 ® Friedag 2009 34

31. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
6. Responsibility – results orientation of all
 Give all employees enough scope for creativity
- new ideas need time to ripe
- ideas want / need to be tested
- there are always many reasons not to dare new things
 therefore seek for good reasons why new ideas can be
successful
Ideas
create
future
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32. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
6. Responsibility – results orientation of all
 Give all employees enough scope for creativity
 Every employee should be given enough time to work out and give
recommendations for better and customer-oriented activities
 Encourage and support passion and commitment of those who
want to work for the future of the company
- the boss knows and sees a lot but not everything
- many bosses see and know more
 we waste many hidden potentials
23.06.2009 ® Friedag 2009 36

33. Aspects of Management 2.0
1. Goals
– shared view for the journey together
2. Organisation
– balance of stakeholders interests
3. Values
– internal and external appreciation
4. Structures
– scope for changes (redundancy)
5. Culture
– competition and mistakes to get better
6. Responsibilities
– results orienations of all
7. Communication
– open communication
23.06.2009 ® Friedag 2009 37

34. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
7. Communication – open communication
 Information concerns everybody
- dare active participation and openness
- transparency stimulates and contributes to more comittment
 Effective cooperation requires openness and trust
23.06.2009 ® Friedag 2009 38

35. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
7. Communication – open communication
 Information concerns everybody
- dare active participation and openness
- transparency stimulates and contributes to more comittment
 Effective cooperation requires openness and trust
 Speak the language of the employees
- it doesn‘t matter what you say,
but what and how that is understood by the people
- involve all stakeholders
 Use the knowledge of the whole organisation
- only few know what kind of knowledge is available in the company!
- and how much was already invested in the knowledge of the
company
Check also: Gary Hamel et.al. „moonshots for management“, http://blogs.harvardbusiness.org/hamel/
23.06.2009 ® Friedag 2009 39

36. Cooperation for sustainable development of companies
Management 2.0
Cooperation for a sustainable „successful“ business activity
1. Definition of Management 2.0
2. Aspects of Management 2.0
3. Don´t worry, be happy – Go the “Management 2.0“ way
23.06.2009 ® Friedag 2009 40

37. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
Goals – shared view for the journey together
Does your business model answer the following questions:
 Why should the customer still buy our product in 3 years?
 Do all employees know and understand (!) the strategic goals of the
company?
 Does every employee know how he/she can contribute to the
achievement of those goals?
23.06.2009 ® Friedag 2009 41

38. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
Organisation – balance of stakeholders interests
 Involve customers and employees in the process of setting goals
 Name the uniqueness of your products
 Does your product deserve its price or does it offer the customer -
value?
23.06.2009 ® Friedag 2009 42

39. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
Values – internal and external appreciation
 Is your travel cost arrangement 10 pages or only one?
 Do not budget every pencil!
 Internal month- or quarter reports should be on one page and every
report should be recipient-oriented
23.06.2009 ® Friedag 2009 43

40. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
Structures – adapted to the changes
 You should manage not more than 7 people directly
 Engage customers and suppliers in developments and make them
partners
23.06.2009 ® Friedag 2009 44

41. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
Culture – competition and mistakes to get better
 Every supervisor is responsible that at least one process
improvement is suggested per every employee per quarter
 Mistakes are communicated with the aim that others learn from them
 Managers should reserve one day a week for strategy
23.06.2009 ® Friedag 2009 45

42. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
Responsibility – results orientation of all
 Look after that every employee accepts responsibility for results
 Make competency possible and give authority for taking decisions
23.06.2009 ® Friedag 2009 46

43. Goals – Organisation – Values – Structures – Culture – Responsibility - Communication
Communication – open communication
 You as a manager do try to talk to each employee personally once a
week, once a month at his workplace
 Every team should announce its goals and the current results
23.06.2009 ® Friedag 2009 47

44. Management 2.0
Can you imagine that your boss will sleep better with Management 2.0?
If so: make the boss happy!
Management 2.0: Cooperation for success
Coming together is a beginning,
Keeping together is progress,
Working together is success.
___________________
Henry Ford
23.06.2009 ® Friedag 2009 48

45. Management 2.0: Goals – Organisation – Values – Structures– Culture – Responsibility - Communication
With Management 2.0 you will secure commitment -
Manager, Controller and all other stakeholders have better chances
to overcome the next crisis and
to be happier …
Management 2.0:
with cooperation to the success
23.06.2009 ® Friedag 2009 49

46. Management 2.0: Goals – Organisation – Values – Structures– Culture – Responsibility - Communication
dziękuję bardzo
Hvala
Management 2.0
23.06.2009 ® Friedag 2009 50