Responsible European Management

1. Responsible European Management Prof. Maddy Janssens Katholieke Universiteit Leuven, Belgium

2. Why good companies do bad things? • The senior managers consider ethical or social issues as matters for somebody else to resolve • They talk to the same circle of people and information sources all the time and avoid people or organisations who disagree with them or criticise them • They discourage employees from thinking about their work as whole people, from using their moral and social intelligence as well as their business intelligence • They focus exclusively on financial measures of performance (Schwartz & Gibb, 1999)

3. Structure • Responsible Management • Value Based Management • Stakeholder Engagement • A Place for Personal Development • Towards Implementation

4. Responsible Management • Responsibility • as members of society, organizations have an obligation to uphold social values • however, digression into debates among competing moral positions • Responsiveness • technical capability and willingness of organizations to adjust to society as reflected in the behavior of the organization • focus on specific issues

5. Value Based Management • Values - Identity - Behavior • Types of Values • Management of Values

6. Value Based Management • Values are central to the identity of an organization Social Values Individual Values Stakeholder Values Organizational Values

7. Value Based Management • Values • exist in a hierarchical relationship to another • business values • social values • drivers of behavior • behaviors are indicators of underlying values • critical events to identify values-in-use and espoused values

8. Value Based Management • Business Values • profit motive: success orientation - positive cost/benefit ratio - competition orientation • future and product orientation: stability - predictability - control - order • Value based management is for many people: value for shareholders

9. Value Based Management • Social Values • f.ex. values that strengthen collaboration with stakeholders systems thinking - service - authenticity and trust - wisdom of the individual - spirit of inquiry/risk taking • f.ex. chemical company participation - personal growth - autonomy - variety - career development - minimalization of status differences

10. Value Based Management • Social Values • social mission statement “…is a democratic, ethical and innovative provider of financial services to its members. Through strong financial performance, we serve as catalyst for the self-reliance and economic well-being of our membership and the community”

11. Value Based Management • ‘Management of Values’ • explicit process of identifying the type of values that drive decision making • skeleton principles: guide for actions applied in a specific situation --> balance between business and social goals • attention to process of defining the values: how and who?

12. Value Based Management • building a shared value set Co-creating Consulting Testing Selling Telling Degree of Active Involvement

13. Value Based Management • Concluding Reflections • link between business goals with broader social goals and responsibilities • behaviors and practices grounded in a specific set of values are more credible • critical events are the test of value based management • stakeholder dialogue: whose values have been considered?

14. Stakeholder Engagement • Evolution of Stakeholder Theory • Input-output model • Stakeholder model • Systems model • Notion of Dialogue • Concluding Reflections

15. Stakeholder Engagement • Management as ‘Input-Output’ Model inputs management control output labor services capital products equipment internal operations supplies... a: cost containment b: creation of needs c: goal selection and direction of work process a b c

16. Stakeholder Engagement • Input-Output Model • relationship to society: independent • responsibility of corporation: to make a profit • role of managers: agents of shareholders • management style: defensive

17. Stakeholder Engagement • Stakeholder Model • each company has its own unique set of stakeholder groups who are affected by corporate activities and can affect the corporation • primary and secondary stakeholders • primarily: directly linked interests • secondarily: indirectly influence

18. Stakeholder Engagement Customers NGO’s Competitors Suppliers Organization Community Unions Shareholders Employees

19. Stakeholder Engagement • Stakeholder Model • relationship to society: interpenetrating • responsibility of corporation: to respond to stakeholders • role of managers: relationship managers • management style: buffering

20. Stakeholder Engagement • Role of Managers? (Freeman, 1984) • expected to serve as the internal representatives of the various stakeholder groups • interaction on issues of mutual concerns • interaction should be voluntary, based on cooperation, communication and negotiation • difficult task of weighing and prioritising the conflicting demands and interests of various stakeholders

21. Stakeholder Engagement • Critiques • balancing conflicting interests is simply not possible • only attention to powerful stakeholders whose claim is then considered to be legitimate and urgent • stakeholder management techniques seek to direct and control interactions with stakeholders: compliance instead of trust

22. Stakeholder Engagement • Towards Relational Conception of Stakeholder Theory • emphasis on relationships themselves instead of interests of stakeholders • managers are not separate from stakeholder relationships but part of it • the stakeholder relationships are multiple and constitute social networks

23. Stakeholder Engagement Customers NGO’s Competitors Suppliers Organization Community Unions Shareholders Employees

24. Stakeholder Engagement • Systems Model • relationship to society: interdependent • responsibility of corporation: to find ethical win-win opportunities with stakeholders • role of managers: relationship builders • management style: collaborative

25. Stakeholder Engagement • Role of Managers? • don’t manage stakeholders’ relationships but manage the expectations of the relationship • involve those stakeholders who are affected by a decision, in making that decision • care for the needs of stakeholders - respect different perspectives -->evaluate decisions by the way they are made and by whom, not by their content or consequences

26. Stakeholder Engagement • Notion of Dialogue • dialogue ≠ consensus • dialogue: • explore underlying patterns of meaning • allow addressivity, responsiveness of the other parties • allow the differences to co-exist • dialogue ≠ argumentation • other ways of communication: story telling

27. Stakeholder Engagement • Concluding Reflections • focus not only on stakeholders’ interests but also on relationships themselves • concern with process questions: • who needs to be involved?: be concerned for the ‘silent’ stakeholders • what is the process of deciding?: create an inclusive way of communication

28. A Place for Personal Development • Development • conditions of development • organizational barriers of development • Diversity in Development • different needs within work context • different needs outside work context

29. A Place for Personal Development • Development as Growth of ‘Whole Person’ • as employees, members of an organization • as ambassadors of the organization to its customers, clients, audiences and suppliers • as citizens of the wider society in which the organization exists • as human beings with the need to realize their own capabilities

30. A Place for Personal Development • Development? • integration of work and learning • job development programs • personal learning plan: personal skills • liaisons with local organizations • bring outsiders into the organization • stimulate outside links with community

31. A Place for Personal Development • Conditions of Development • exploration of new possibilities > exploitation of old certainties unlearning, experimenting with alternative environments, intentionally creating instability, variety • difference as driver of development

32. A Place for Personal Development • Organizational Barriers • organizations tend to assign their resources to exploitation • organizational practices tend to stress sameness • division of labor • formalisation • socialisation

33. A Place for Personal Development • Diversity of Needs within Work Context • interests of modal employee ≠ diverse employees • role of union • content of the union agenda: discourse of equality and fairness precludes the acknowledgement of the diversity of interests • process of the unions: development of arena’s, spaces in which diverse employees can identify and articulate their concerns --> focus on issues at the level of the workplace

34. A Place for Personal Development • Diversity of Needs outside Work Context • development may mean: work-life balance, child care, part-time work, leave of absence, ... --> stepping ‘aside’ from the norm

35. A Place for Personal Development • Concluding Reflections • Step aside from the norm • development has different meanings • Create spaces to identify and articulate different interests • Create spaces where a variety of options can be further developed

36. Towards Implementation • Instead of a cry for tools, we should be crying out for skills • skills in bringing people together, in promoting and facilitating dialogue • skills in creating a safe space within which issues can be ventilated with minimum of pain • skills in guiding institutional learning and collective strategizing