Framework 99 ACE-I

Introduction

You cannot manage change, you can only handle it by endeavouring to anticipate its 'twists and turns' and need to be flexible plus to see change as an opportunity, ie in a positive light.

Change has become the norm. You need to handle it to survive and thrive in a turbulent, disruptive future.

NB As effectiveness means doing the right thing and efficiency means doing things right, efficiency needs to be based on a foundation of effectiveness.

This framework is based on Peter Drucker's work and involves 'ACE-I', ie an approach to making effective change happen.

1. A (abandonment of unproductive and obsolete products, services, processes, people, etc)

"...every organisation has to systematically find and abandon the things that no longer work, never worked, things that have outlived their usefulness and their capacity to contribute to performance and results..."

Bernard Jaworski, 2021

Purge yourself of marginal mediocrities. This will free up resources like people, capital, energy, etc to work on more productive things.

This involves focusing on

- building on your strengths, ie work on the areas of the organisation which do extremely well and which customers want, ie willing to pay for. Try to improve performance in these areas.

- outsourcing of mission-critical support activities that others can do better than you

NB If not mission-critical, abandon the activity.)

2. C  (continuous and systematic productivity improvement)

It is every manager's job to make all resources more productive in the areas in which he/she has responsibility. There are many tools/techniques available (see other sections for more detail in the knowledge base). You need to look at all resources, ie products and services, production processes, technologies, people, capital, etc. The higher your productivity is, the more profitable the organisation is.

The aim is to systematically improve the productivity of all assets including products and services, production processes, technologies, people, capital, etc. Capital is shown by return on invested capital, ie

"...if the return is inadequate or if you can get a higher return by selling your stock and investing it elsewhere, you are attempting to increase the productivity of your capital..."

Bernard Jaworski, 2021

Most leading organisations operate at around twice the average productivity of their industry, ie

They are market leaders because they are significantly more profitable than their competitors.

Linking technological advancements from innovation and productivity improvements is the basis of success.

Training and retraining are important for continuous improvement.

Successful continuous improvement requires measuring the right parameters, ie need specific outcomes that are measurable, not vague statements

"...Continuous improvement in multiple areas leads to fundamental change..."

Peter Drucker as quoted by Bernard Jaworski, 2021)

3. E (exploiting own successes)

"...In short, do more of what's truly successful and abandon what is only marginal or not working..."

Bernard Jaworski, 2021

This includes exploiting unexpected/hidden successes, ie

"...The unexpected success is usually treated as a nuisance. Nobody is looking for it; nobody wants to be bothered by it; no one is assigned to seriously look at the possibilities of exploiting the unexpected success......organisations of all kinds and sizes fail to recognise the potential of an unexpected success..."

Bernard Jaworski, 2021

Need to

"...look for opportunity in the unexpected success..."

 Peter Drucker as quoted by Bernard Jaworski, 2021

To look for unexpected successes, the following questions can help

"...i) what would it mean to us if we exploited it?

    ii) where could it lead us?

   iii) what would we have to do to convert it into an opportunity?

    iv) how do we go about it?

This means, first, management need to set aside specific time in which to discuss unexpected successes; and secondly, an individual or team should always be assigned to analyse an unexpected success and to think through how it could be exploited..."

Bernard Jaworski, 2021

One way to locate unexpected success is by analysing customers' data, ie disaggregating the data into subgroupings. For example, in the 1930s it was found that there was a neglected market for Cadillacs, eg wealthy African-Americans like entertainers, professionals, business operators, etc. Traditionally Cadillacs sales staff focused on the 'white prestige market'. However, Cadillacs were one of the few success symbols that affluent African-Americans could buy in the 1930s. This switch in emphasis saved the Cadillac brand.)

4. I  (innovation)

"...purposeful innovation is the key to sustained success. An organisation must identify where it needs new innovations and must understand what must be done to reduce and manage successful innovation......innovation is not an eureka moment. It is an acquired management skill..."

Bernard Jaworski, 2021

Innovation is about creating new value for customers. The key question is 'Will this make a difference that is considered valuable to existing and/or potential customers?'

"...To start out with an unfilled customer need is the best way to find innovative opportunities. It is possible new science, new knowledge, new technology, new processes are required to make innovation happen. There are many kinds of innovation including process innovations, product and service innovations, business model innovation, operating methods innovation, distributive channel innovation......creating new businesses with existing business innovation..."

Bernard Jaworski, 2021

Innovation is a discipline, ie it can be successfully taught, learnt and practiced.

In most organisations the allegiance is to the daily tasks, ie they exist to get today's job done via rules, procedures, systems, processes, etc. However, tomorrow's jobs are most likely going to be different and require new ways to handle. Organisations, therefore, need to encourage the desire to innovate to handle the future.

(source: Bernard Jaworski, 2021)

 

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