Innholdsfortegnelse for May/June 2024 i The European Business Review

ARTIFICIAL INTELLIGENCE At a time when the skills mix of workers is exploding and the future of work is dramatically changing with work-from-home, automation, and AI, front-running companies are moving their organisations to a world of better skill use and continuous learning.2 But what they mostly find is that AI skill tech is a critical software solution to support the journey to an SBO. 1 THE CAUSES AND REWARDS OF SBO The concept of the SBO represents a paradigm shift in the traditional working model. Instead of rigid job-centric structures, these organisations prioritise human skills, defining work by breaking down roles into tasks and activities based on required competencies. This transformative approach fosters an environment that values employee expertise, continuous learning, and adaptability over traditional siloed structures. The trend towards…

DIGITAL TRANSFORMATION How many major organisational changes has your company been through in the last five years, and did those changes create value? At MIT CISR, we studied over 700 companies to understand how companies unlock new digital value.1 We found that a company must perform organisational surgery, often reorganising many times to create the value. The top-performing companies in our research underwent, on average, 7.2 major organisational changes in the preceding five years, but the results were worth the disruption, as the companies grew well above their industry average. We found that the companies in the top quartile of effectiveness at using these four levers were also top financial performers, growing at almost 12 percentage points above their industry average, and leaders in innovation, with 45 per cent of…

INTRODUCTION Organisational resilience refers to an organisation’s ability to adapt, respond, and recover from disruptive events and changes in its environment. In a VUCA world, which stands for volatility, uncertainty, complexity, and ambiguity, organisational resilience becomes even more crucial. To become resilient, the organisation needs to develop certain characteristics that were not so crucial in running the business in former years but have become so essential in today’s business. For a firm, not being able to adjust quickly may lead to death and extinction. The objective of this article is to describe the principal features of organisational resilience, with an emphasis on culture, structure, leadership, and other relevant features. WHAT ARE RESILIENT ORGANISATIONS ACCORDING TO DELOITTE'S 2020 REPORT?2 In the wake of a tumultuous 2020, Deloitte Global’s fourth annual readiness…

WORK CULTURE Do you consider yourself lucky? Do you want to increase your luck? It is believed that Napoleon Bonaparte countered criticisms about his reliance on luck in battles by stating, “I prefer lucky generals to skilled ones.” Napoleon ignored his Foreign Minister Maurice de Talleyrand-Périgord’s advice against the invasion of Russia in 1812, where he lost the war to “General Winter”. The lessons of history reveal that excessive reliance on luck and neglecting constructive criticism can exhaust one’s lucky streak. Despite amassing billions through his telecommunications empire bearing his name, the former Thai Prime Minister Thaksin Shinawatra’s decision to evade taxes on the $2 billion sale of his conglomerate to the Singaporean Temasek Holdings accelerated his downfall because of corruption. While fortune favours the bold, it tends to evaporate…

Environmental, social and governance (ESG) data is entering its adolescence. The early days of ESG were characterised by a modicum of faith amongst investors that ESG performance data correlated with financial returns. We knew from empirical studies and meta-analytic summaries of the literature that considering ESG data in investment decisions was more likely than not to correlate with higher returns compared to benchmark1. Investors piled in and the assets under management that considered ESG information grew2, creating in some circumstances a self-fulfilling feedback loop of higher returns. However, adolescence is characterised by a search for personal meaning and ever-growing responsibility and these challenges are indicative of where ESG data will need to evolve if sustainable finance is to reach its full potential. The challenge with our current approach to ESG…

ARTIFICIAL INTELLIGENCE AI has emerged as a transformative force that is reshaping businesses, economies, and societies worldwide. Business leaders in 2024 are at the forefront of this shift, responsible for guiding their organisations through this period of transition, and the strategies they implement today will have a lasting impact on the shape of their industries. This is a huge responsibility and one that should not be held by a small demographic of people. For AI to fulfil its potential and create a positive impact, its leadership needs to be reflective of our society at large, developed by diverse voices, for everyone. A pivotal aspect of this is ensuring that female business leaders take a prominent position in the forefront of the AI revolution. To explore this very topic, IBM EMEA…

GENERATIVE AI The power of generative artificial intelligence (GEN AI) has organisations of all types intrigued and clamouring to leverage its functionality to enhance productivity, improve their financial bottom line and maintain market share or possibly achieve a competitive advantage. Increasing the speed and robustness of information assets presents ample opportunities for process applications. However, the jury is still out on a few issues for implementing this technology to achieve truly valuable results. Issues involving the data that must be accessible for large language models (LLMs), verifying the output generated and where to apply the platform to operationalise it for a sustained production environment introduces difficulties in its adoption. The following steps provide a high-level methodology on how to best approach the implementation of GEN AI to produce effective results…

LEADERSHIP AND MANAGEMENT Organising as an ecosystem(s) (or an organisational ecosystem, as we refer to it) bestows upon firms many benefits on paper. It enables firms to exploit economies of association and capitalise upon the resources and capabilities (think talent, technology, and knowledge) of a network of external partners (think other firms, institutions) to supercharge their innovation capabilities in ways not possible if relying upon internal resources alone. However, most organisational ecosystems fail to deliver on their promise according to published research.1 Part A of this two-part series of articles focused on the importance of strategically aligning organisational ecosystems to be fit for purpose if they are to succeed. It put forward a framework of three strategic choices, each of which is vital and should align closely to achieve high…

WORK/LIFE BALANCE The concept of happiness has become a buzzword in recent years, aiming to overcome all individuals’ misery, whether it is felt at home, at work, or in the community. After all, who does not want to be happy or to become happy? Happiness as a concept can be compared to the brightness and warmth of the sun. Do you know anyone who expresses negative feelings or attitudes against the sun? Happiness is often oversimplified as a state of being that is universally desirable and easily attainable. The comparison of happiness to the sun, with its connotations of brightness and warmth, serves to perpetuate this complex concept. While it is commonly believed that happiness is a panacea, a closer examination reveals this notion to be oversimplified and potentially dangerous.…

ARTIFICIAL INTELLIGENCE The elderly housing sector has been somewhat slow in the adoption of technology and artificial intelligence, compared to other industries. Contrary to popular belief, AI does not necessarily signify a loss of jobs or diminished human interaction. Rather, it carves out more space for meaningful human engagement by streamlining routine tasks. AI can be instrumental in promoting human interactions with senior residents and discovering innovative solutions for monitoring staff well-being, ultimately putting human capabilities to their best use – fostering human connections. To date, only a scant number of companies and organisations in Finland have shown serious interest in integrating AI into this field. Finnish elderly housing company Foibekartano, is at the forefront, forging a new path in the company and in the health and social care industry.…

GENERATIVE AI KEY TAKEAWAYS: 1. Gen AI has the potential to transform 44% of the total work hours in 10 major European countries. 2. Done right, Gen AI opens up a trifecta of opportunities — economic, business and human. 3. Leaders will need to learn how to close the trust gap with workers, who are central to Gen AI-led transformation of work. Generative AI (Gen AI) is set to transform vast swathes of industry in Europe when it comes to how, where and by whom work is performed. Customer service executives, banking employees, writers, art directors, legal assistants, coders, health providers, everyone will need to learn to work differently — hand-in-hand with Gen AI tools. Success hinges on how organisations will reinvent work and prepare workers for a Gen AI-infused…

How many times have you heard recently of an organisation or a process that is due for reimagining, rebuilding, or future-proofing? We live in a time where organisational wisdom has shifted from a company’s sum of experience and expertise to a willingness to open up, to be flexible, and to play with the boundaries of how we see the world and our place in it. Underpinning this pursuit of how things could be and possibly will be is curiosity — organisational and collective, as well as individual. Indeed, curiosity is seeing a renaissance, particularly across innovation-focused industries such as pharma, tech, and media. Corporations including Merck, Nike, Disney, Target, GE, NASA, Novartis, Facebook, the LEGO Group, Microsoft, and Dell have recognised and established curiosity as a key component in their…

WORK CULTURE We value our employees’’, ’’Employees are our biggest assets’’, ’’Employees are invaluable for us’’, etc. Phrases such as these are common across company websites and other public-facing communication. Nonetheless, how does an employer demonstrate that they value their employees? This question has been answered in myriad ways by different disciplines (see, for instance, Shields et al. 2015). Economics, in its neoclassical version, provides what is possibly the least compassionate answer: by paying a wage equal to the marginal productivity of the worker. This can be further compounded by the sentiment (rightly or wrongly) across current and potential workers that they can be replaced anytime with another worker for lower pay and benefits. However, employers generally behave differently and pay an efficiency wage that is sufficiently high to induce…

Supply chains have been faced with an ever-increasing number of regulations and laws. This creates new complexities for supply chains and requires companies to adjust their processes to remain compliant. Supply chain leaders that focus on human rights and sustainability have seen Europe play a leading role when it comes to new regulations in the last few years. More recently, the EU has put pen to paper with the introduction of the European Union's Supply Chain Due Diligence Directive (CSDDD), also referred to as the “EU Supply Chain Law”, taking a bold step towards corporate accountability. This groundbreaking legislation, which is a first from a global perspective, is being finalised in 2024. This will require companies operating in the EU to start taking full responsibility for human rights and environmental…