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THE CHANGE MAKERS’ MANUAL
EDITION 11 | 2023
Why strategy shouldn’t be secret 13 | How to adopt AI responsibly 20 Can AI police social media? 22 | Wake up to workplace naps 52 AI: Should we be afraid?
FIRST WORD
will reign during a similar period of progress, fuelled by AI. This AI-themed issue of Core sees our faculty weigh the benefits, risks, and limitations of this digital transformation in our cover story. Elsewhere, Hila Lifshitz-Assaf, head of our Artificial Intelligence Innovation Network, reveals how managers can avoid costly mistakes when investing in AI tools. James Hayton, Joe Nandhakumar, Zhewei Zhang, and Hong Yu Liu explore how this technology will transform work and careers. Matt Hanmer and Dan Philps from the Gillmore Centre for Financial Technology examine how it will shape the future of fintech. And Shweta Singh outlines how AI could protect vulnerable social media users. This issue is testament to the vital research that WBS is conducting into AI and its impact. We are committed to sharing that knowledge with our students and alumni, making it the focus of this year’s MBA conference. You can also read valuable insights on sustainability, strategy, leadership, behavioural science, and healthcare – all delivered by our world-class faculty without so much as an AI-generated headline.
“I wanted to graduate feeling equipped to innovate and confidently lead any organisation into the digital future.” Colin Bennett Executive Diploma in Digital Leadership alum The Warwick Executive Diploma in Digital Leadership Equip yourself with the skills to drive digital transformation in your organisation, and learn from some of the leading experts in the world of digital business.
Core Edition 11 Executive Editor: Warren Manger
Staff Writer: Simon Wilcox Cover: Mark Udall
Art Director: Donna Morris © 2023 The University of Warwick. All rights reserved. Neither this publication nor any part of it may be reproduced, stored in a retrieval system, or transmitted in any form or by any means electronic, mechanical, photocopying, recording or otherwise without the prior permission of the department of Warwick Business School at the University of Warwick. Published by Warwick Business School, the University of Warwick, Coventry, CV4 7AL. E enquiries@wbs.ac.uk T +44 (0)24 7652 4306 W wbs.ac.uk @warwickbschool warwickbschool wbs.ac.uk/go/linkedin Where opinion is expressed, it is the opinion of the author and does not necessarily coincide with the views of the publisher or the University of Warwick. All information in this magazine is verified to the best of the authors’ and the publisher’s ability. However, Warwick Business School and the University of Warwick do not accept responsibility for any loss arising from reliance on it. warwickbschool warwickbschool
T hey may be separated by nearly 400 years, but there is an interesting parallel between Charles III and the last British monarch to share his name. Charles II presided over a scientific revolution during the 17th century, founding the Royal Observatory at Greenwich and giving the Royal Society its charter. The newly-crowned king
Professor Andy Lockett Dean of Warwick Business School
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CONTRIBUTORS We believe that business should be used as a power for good. Our faculty of research and teaching academics is constantly striving for excellence in everything it does, from the latest groundbreaking research impacting society, to inspiring our students. Contributors to Core include research-active academics, who produce cutting-edge theories with real-world impact, and Professors of Practice, who bring their knowledge gained from successful senior business and industry experience.
IN THIS ISSUE
SUSTAINABILITY
46 Be career confident by Roma Kiddy LEADERSHIP 47 Last line of defence How Major Luke Parker delivered data insights to battle Covid-19
Delve into AI’s ‘black box’ to discover how emerging technologies will transform your company and career.
06 Power up your purpose Five steps to help your firm deliver the SDGs by Frederik Dahlmann
DIGITAL INNOVATION AND ENTREPRENEURSHIP 20 Is your AI strategy sustainable? Use this tool to find out by Sotirios Paroutis 22 TikTok Can AI protect children online before it’s too late? by Shweta Singh
FUTURE OF WORK
33 The future is algorithmic How will AI affect careers? by James Hayton 36 Will robots take your job? by Hong Yu Liu
ISABEL FISCHER Reader in Information Systems Isabel.Fischer@wbs.ac.uk
FREDERIK DAHLMANN Associate Professor of Strategy and Sustainability Frederik.Dahlmann@wbs.ac.uk
MATT HANMER Honorary Research Fellow, Gillmore Centre Matt.Hanmer@wbs.ac.uk
SHWETA SINGH Assistant Professor Shweta.Singh@wbs.ac.uk
STRATEGY AND ORGANISATIONAL CHANGE
50 Light the way How committed leaders can empower staff by Nicola Burgess
DAN PHILPS Honorary Research Fellow, Gillmore Centre Daniel.Philps@wbs.ac.uk
LOIZOS HERACLEOUS Professor of Strategy Loizos.Heracleous@wbs.ac.uk
JAMES HAYTON Professor of Entrepreneurship and Innovation James.Hayton@wbs.ac.uk
HILA LIFSHITZ-ASSAF Professor of Management Hila.Lifshitz-Assaf@wbs.ac.uk
10 Five ways to frame your strategy by Loizos Heracleous 13 Secret mission? Why strategy should be shared by Christian Stadler
39 Lost in the fog How bespoke AI systems offer a way forward by Joe Nandhakumar and Zhewei Zhang
ROMA KIDDY Employer Relations Co-ordinator Roma.Kiddy@wbs.ac.uk
HONG YU LIU Research Fellow Hong-Yu.Liu@wbs.ac.uk
NICK CHATER Professor of Behavioural Science Nick.Chater@wbs.ac.uk
CHRISTIAN STADLER Professor of Strategic Management Christian.Stadler@wbs.ac.uk
25 All that glitters
DECISION-MAKING AND ANALYTICS 52 Wake up to the benefits of power naps Can sleep science boost productivity? by Mattie Toma
How to avoid buyer’s remorse over AI tools by Hila Lifshitz-Assaf 28: Cover story AI: Should we be afraid?
FINANCE AND MARKETS
by Warren Manger and Simon Wilcox
NICOLA BURGESS Reader of Operations Management Nicola.Burgess@wbs.ac.uk
HELEN BEVAN Professor of Practice in Healthcare Improvement Helen.Bevan@wbs.ac.uk
RAM GOPAL Professor of Information Systems Management Ram.Gopal@wbs.ac.uk
JOE NANDHAKUMAR Professor of Information Systems Joe.Nandhakumar@wbs.ac.uk
HEALTHCARE AND WELLBEING
43 Wax or wane? How AI will affect fintech
17 Many happy returns? How to help the NHS survive and thrive at 75 by Helen Bevan
Matt Hanmer and Dan Philps speak to Simon Wilcox
ZHEWEI ZHANG Assistant Professor Zhewei.Zhang@wbs.ac.uk
MATTIE TOMA Assistant Professor of Behavioural Science Mattie.Toma@wbs.ac.uk
EIVOR OBORN Professor of Healthcare Management Eivor.Oborn@wbs.ac.uk
SOTIRIOS PAROUTIS Professor of Strategic Management Sotirios.Paroutis@wbs.ac.uk
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Sustainability
EMBEDDING THE SUSTAINABLE DEVELOPMENT GOALS by Frederik Dahlmann POWER UP YOUR PURPOSE FIVE STEPS TO HELP YOUR FIRM DELIVER THE SUSTAINABLE DEVELOPMENT GOALS
TO THE CORE T
he Sustainable Development Goals (SDGs) were unveiled by the United Nations (UN) as a roadmap to a greener, fairer future.
pursue the SDGs as well as profits. In recent research, my colleagues and I looked at how companies interact with a loose network of emerging for-profit and not-for-profit organisations – including consultancies, investors, financiers, NGOs, and training and development agencies – to become more sustainable. We describe this network as a ‘purpose ecosystem’, which is increasingly driving change in some countries and nudging companies towards adopting the UN’s SDGs as a key influence for their organisational purpose and business strategies. Drawing on this research, my advice to companies can be broken down into five key steps. 1 Prioritise the SDGs Senior leaders need to decide how to prioritise the 17 SDGs, playing to their company’s strengths and values. Companies may agree with all the SDGs, but need to decide which ones could best be furthered through their actions, investments, attention, and resources. Analysis using materiality matrices or stakeholder frameworks can help, as can the UN Global Compact, which has created tools and resources to help companies translate the SDG framework into practices and actions that can be adopted by management. Executives should also review the overlap between the SDGs and firm’s environmental, social and corporate governance (ESG) concerns.
1. Decide which SDGs to prioritise, playing to your strengths. Concentrate on where your
But this crucial plan is in danger of losing its way.
actions and investments will have most impact.
2. Find the commercial opportunities in what society and the environment needs. 3. Align your organisation’s purpose with the SDGs and integrate them into your product development, marketing, and operations.
“Our progress towards the SDGs has faltered and even gone into reverse on some important targets, leaving many behind,” warned UN Deputy Secretary- General Amina Mohammed as she addressed the Arab Forum for Sustainable Development in March. “Unless we act now, all these factors could put the promise to reach the Sustainable Development Goals far out of reach.” That concern is justified. The SDGs aim to improve socio- economic and environmental conditions around the world by 2030. They are essential to avert disaster in the face of global economic and population bigger role in accelerating that process. Many firms are already reassessing their broader purpose and seeking impact beyond the financial bottom line. The young talent they want to recruit desire a deeper purpose in their work, while financiers, equity holders, and governments are eager to avoid the risks of ignoring sustainable decision-making. This creates plenty of external and internal pressure on companies to growth. There has been progress, but not enough. Companies could play a
4. Work with academic institutions, social
movements, NGOs, and regulators to multiply the impact of your actions.
5. Larger companies can work with suppliers to
drive change through their purpose ecosystem.
“Senior leaders need to decide how to prioritise the 17 SDGs, playing to their company’s strengths and values”
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Sustainability
While it covers similar ground, the ESG approach involves an analytical framework focused on risks to the company, rather than a set of global goals that provide the socioecological foundations for economies and businesses to thrive. Not adopting certain SDGs may represent a material risk to a business that an ESG framework would not identify. Yet many companies take this limited ESG, compliance-driven approach. On its own, consideration of ESG concerns is unlikely to fully achieve the SDGs. It is also important that senior leaders have a positive outlook on the SDGs and see them as opportunities, rather than simply as risks or problems. Most are not attuned to think of SDG solutions as commercial opportunities – even though they often are the very things that society and the environment need most. The provision of food, education, healthcare and green energy, for example, are essential for the world to prosper and progress, and so embody significant intrinsic value. Once the SDGs are seen as opportunities for organisations to 2 View the SDGs as opportunities add value, executives should ask how to develop the capacity to provide the innovative solutions, products, and services needed to achieve the goals on a commercial basis. 3 Align and integrate The next step moves the organisation towards being a truly purpose-led enterprise with the planet’s goals at the heart of its strategy. This means aligning the organisation’s purpose with the UN’s SDGs and integrating their policy intentions into all functional areas, including
marketing, operations, and product development. The key is embedding
17 SUSTAINABLE DEVELOPMENT GOALS (SDG S ) TO TRANSFORM OUR WORLD
consideration of the chosen SDGs in decision-making across the entire organisation and its supply chain. While this may take time and bring internal disruption, businesses need to understand the process involved so they can adapt organisational structure and resources over time to achieve the goals. Examples include setting internal targets, adapting key performance indicators, providing revised performance incentives, ensuring board representation with sustainability expertise, and revising internal values and policies to integrate the targeted SDGs. This can help dictate the strategic direction of a company. It should also help to identify other opportunities to make a positive contribution that were not previously considered. 4 Create a co-operative network Next, companies should co-operate with external entities to work towards their chosen goals. This includes academic institutions, financiers, social movements, NGOs, and regulators. Collective action will multiply any impact, as many of these will be considering their own purpose and seeking to make an increased contribution to the SDGs. Exactly who to collaborate with will depend on which goals are involved and where. For example, international supply chains have a social dimension that may benefit from interaction with non-profit organisations on the ground in a variety of countries. Supply chains also need to become much more circular, rather than linear, from a resource perspective – an area where larger multinationals can have
best to use their organisation for driving systemic change within their sector and how to instil purpose within their own ecosystem. This will depend on the size of the organisation and its position in the value chain. For instance, Danish multinational brewer Carlsberg has taken on the role of changemaker, leading the changes in its packaging and supply chain to achieve the necessary sustainability goals. Larger companies can create a purpose infrastructure based on their own approach. However, this can mean divergent approaches to the same SDG as different companies play to their own strengths and respond to their unique environments. While all approaches should move us closer to the UN goals, some may prove more effective than others. These steps are part of a long journey, but a vital one if the world is to meet its net-zero targets to save us from catastrophic climate change and bring about a just, equitable society.
a particularly big influence. Co-operation with other companies, including competitors, both inside and outside the firm’s own industry is key, and is often essential for the wholesale transformation of sectors such as packaging, where multiple actors are involved and a critical mass is required for change. Companies must also collaborate with local and national governments to ensure regulations are well designed. Policymakers must impose regulation to guard against market excesses, including behaviour that undermines the SDGs. Lobbying from businesses will be accepted by an increasingly critical public, as long as it is transparent and aligned with the organisation’s external identity (a common failing by firms). Otherwise, organisations wanting to move further and faster than policies allow may suffer a commercial penalty from the public if regulation doesn’t keep up. 5 Create a purpose ecosystem At this stage, it may also be possible for larger companies to create and co-ordinate their own purpose ecosystem, behaving in a similar way to the smaller entities found in our research. Executives need to decide how
The 17 SDGs, represented by the icons above, lie at the heart of the United Nation’ s Agenda for Sustainable Development. They were adopted by all UN member states in 2015, creating a blueprint for a global partnership to provide peace and prosperity for all. They recognise that ending poverty and other deprivations must go hand in hand with strategies that improve health and education, reduce inequality, and spur economic growth – all while tackling climate change and preserving our oceans and forests. Warwick Business School is committed to embedding the SDGs in its research, teaching, and day-to-day operations. Alongside each article in Core , you will see one or more of the 17 SDG icons to show you which goals the associated research aligns to.
Find out more about our research on Sustainability at Warwick Business School.
Sustainable Development Goals
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Strategy & Organisational Change
SECURING SUPPORT FOR STRATEGY
WAYS TO FRAME YOUR STRATEGY
famous experiment by Nobel prize winner Daniel Kahneman and his long-time collaborator Amos Tversky uncannily predicted the Covid-19
how framing information in a business setting can affect decisions in a similar way. A classroom exercise involving 925 early- and mid-career graduates – all participating in organisational strategy, design and change courses – was carried out over a 22-year period. During that time, 190 teams of up to six people analysed a particular case and were asked to recommend a form of functional structure to support a new contract bid. The inclusion of two sentences by a single character named Datson had a drastic impact on which of the three strategic choices the teams selected. “One thing I want to make particularly clear,” Datson said, “nobody’s going to come into my department and tell my people how they must do their work. They report to me and my supervisors and we’re the ones who call the shots.” The negative framing of this “Do not assume that people will take objective information and statistics as seriously as they should. The framing of an idea changes the decisions that people make”
brief passage prompted hundreds of teams to spurn the strategic choice it represented. This remained true for 20 years. When those sentences were removed, for the final two years of the study, the same strategic choice was selected a third of the time, as would be expected statistically. The sentence was operationally irrelevant. Nonetheless, it seemed to pull on participants’ emotions. Hence, framing can shape how decisions around strategy, organisational change, or large investments are relayed and ultimately perceived by employees, customers, investors, and other stakeholders, as well as how conclusions are reached. Investors, for example, drive the value of a business partly When investors viewed it as a tech company in late 2022, the valuation was two-and-a-half times higher than it is now (and significantly higher than other car companies). In recent months, as perception has shifted towards Tesla being an automotive rather than a tech firm, the valuation has fallen dramatically. Consequently, there are useful based on how they perceive it, beyond the realms of any objective financial analysis. Tesla is a case in point. lessons for leaders and managers on how to frame a strategy to ensure staff and other stakeholders back it. 1 Emotions rule people’s decisions Do not assume that people will take objective information and statistics as seriously as they should. The framing of an idea changes the decisions that people make. Humans do not view things objectively but rely on emotion,
pandemic way back in 1981. Participants were told to imagine the US was preparing for the outbreak of an unusual disease from Asia. Instead of millions of deaths, participants were told scientists expected the disease to kill 600 people. Two alternative programmes were proposed to combat the disease. Crucially, Kahneman and Tversky discovered that the framing of the message affected how people would behave. If the programme was framed positively, telling participants that 200 people would live, it was chosen by 72 per cent of respondents. When the same treatment was framed negatively – i.e. it would lead to 400 people dying – the number of participants who chose it dropped to 22 per cent. Four decades later, the findings helped behavioural scientists to mobilise millions of people across the UK to get the Covid-19 vaccination, despite a barrage of online misinformation. It is a powerful example of how ‘framing’ information can drastically influence the way people perceive it and the decisions they make as a result. The power of framing is the reason why ‘spin-doctoring’ exists as a concept and is regularly deployed – with varying degrees of success – by governments to present policies in a particular light, and by corporations that want to be seen as addressing
by Loizos Heracleous
TO THE CORE
1. Don’t assume that people will take statistics as seriously as they should. The framing of an idea changes the decisions that people make. 2. An implicit storyline that invites moral considerations and emotions into the decision-making process can create buy-in for a strategy. 3. Ensure other departments understand how a strategy is being framed and why. Consider training staff in how to frame their messaging. 4. Recognise that your own decision-making can be influenced by instinctive reactions and adopt measures to ensure you assess decisions objectively.
opinion, and connotations; their decisions are shaped
grand societal challenges. Our research has shown
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Strategy & Organisational Change
OPENING UP YOUR STRATEGY
mission? Secret
debatable investment, or key investors to reach a particular position, may be morally dubious. It is important that any framing is conducted within ethical parameters, where a degree of persuasion is useful and acceptable, but misleading and conveying a false impression is not. 5 Watch out for other people using framing on you As well as using framing to help deliver a strategy, managers and senior leaders should be aware that their own decisions can be affected by their own instinctive reactions. They need to put in place measures to ensure they assess any strategy or decision objectively, so they do not fall victim to the effect of framing. The best way to overcome the framing bias is to ensure there is a diversity of inputs into decisions. There are techniques to accomplish this, such as dividing a team into two groups and asking them to research and debate opposing positions. Another method is to appoint somebody as a ‘devil’s advocate’. Their role is to challenge the assumptions underpinning proposals and arguments to prevent any framing bias. Communication is essential to the implementation of any strategy, and there is a lot more to it than just exchanging information. Knowing and using the true potential of language with the right framing can help people become more effective strategists and leaders.
by Christian Stadler Why strategy should be shared
by their ‘cognitive schemas’ – that is, patterns of thought or behaviour that are influenced by individual characteristics. When looking to frame a strategy that staff will buy into, executives and senior managers can use this to their advantage by ensuring they use appropriate language. For instance, using the term “those people” to describe a particular group is likely to provoke implicit and unintended responses among employees who do not immediately identify with a particular strategy, and could alienate the very people you need to get on side. 2 Consider storytelling Conversely, effective framing can help generate buy-in for a particular strategy. Make use of storytelling and metaphor to evoke a particular image or potential situation. As our research found, creating implicit storylines that invite moral considerations and emotions into the decision-making process has a significant impact on outcomes. It’s a technique deployed to great effect by marketing agencies. Soft-drink brands present images of people drinking their beverage on a beach, with a party going on around them, to create positive
associations with the product. In reality, very few people will enjoy their drink like this. But it’s a powerful image, and a technique that managers can use when selling a vision to staff, customers or even investors. Managers should look at their different stakeholders and identify the framing strategy that is most likely to resonate with them and be seen by them in a positive light. 3 Ensure others know about it When framing a strategy, it is important to ensure that the other departments involved are aware of how important framing is, how a particular strategy is being framed, and why. This could include marketing, internal communications, media and external relations or employee engagement teams, as well as line managers. If necessary, consider investing in training so staff understand how to frame their own messaging around a strategy. 4 Know where to draw the line There is a dark side here, with the obvious potential to use framing to justify things that are questionable or unethical. Influencing the senior management team to make a
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Strategy & Organisational Change
5 READS YOU NEED...
F or all the was no mention of the author’s take on corporate strategy. This may seem a strange observation. After all, Roald Dahl was a beloved storyteller, not a business mogul. Why would anyone seeks his views on executive leadership? Yet many companies continue to follow an outdated approach to decision-making ripped straight from the pages of his 60-year-old children’s story. “You see, Charlie, not so very long ago there used to be thousands of people working in Mr. Willy Wonka’s factory. Then one day, all of a sudden, Mr. Wonka had to ask every single one of them to leave, to go home, never to come back.” “But why?” asked Charlie. “Because of spies. All the other chocolate makers had begun to grow jealous of the wonderful candies that Mr. Wonka was making, and they started sending in spies to steal his secret recipes. The spies took jobs in the Wonka factory, pretending they were ordinary workers, and each one found out exactly how a certain controversy and column inches about the recent attempt to update Charlie and the Chocolate Factory , there
To open up your strategy Julia Hautz, Kurt Matzler and Stephan Friedrich von den Eichen. This is our book opening up strategic initiatives to involve frontline employees, experts, suppliers, customers, entrepreneurs, and even competitors. And in case you are wondering whether it works: a survey of 200 business leaders shows that, although open- strategy techniques were deployed for only 30 per cent of their initiatives, those same initiatives generated 50 per cent of their revenues and profits. Open Strategy by Christian Stadler,
The Upside of Uncertainty: A Guide to Finding Possibility in the Unknown by Nathan Furr and Susannah
of this approach. Shareholders also prefer transparency to secrecy. A study of 900 public strategy presentations found that the average stock price rose by two per cent – or the equivalent of $1.1 billion in market value – on the day of the presentation. The positive effect was even stronger for new CEOs who announced their strategy within the first 100 days. Stock price rose by more than five per cent, which is the equivalent of $2.8 billion in market value. And for new CEOs from outside the industry, the upward bounce was 12 per cent, or $6.6 billion in market value. The message that researchers Richard Whittington, Basak Yakis-Douglas and Kwangwon Ahn revealed is clear. Markets don’t like secrecy. They want to understand your strategy. And if investors don’t think your strategy makes sense, your stock price will drop. The notion that strategy should remain a closely guarded secret has persisted for thousands of years and can be traced to its roots in ancient warfare. The Chinese general Sun Tzu, author of The Art of War , advised generals that: “By discovering the enemy’s dispositions and remaining invisible ourselves, we can keep our forces concentrated, while the enemy’s must be divided.” This is old strategy thinking. In today’s complex and interconnected world, a more collaborative approch is the best way to win the day.
special thing was made.” This fictional exchange was inspired by a genuine struggle for supremacy between the two biggest firms in British confectionary, Cadbury and Rowntree’s. In an attempt to gain a competitive edge, both firms sent employees to work for the other. These undercover confectioners had one job – to steal their rival’s closely guarded secrets. That obsession with secrecy persists today. Executives waste time worrying that their competitors will learn of their plans. In reality, a strategy is more likely to fail because too few people understand it, not too many. A survey of 8,000 managers from 250 companies found that only half of the C-suite have a clear idea how the firm’s priorities fit together. That dropped to a third for their direct reports. On the frontline, just 16 per cent of supervisors and team leaders were able to identify the firm’s strategic priorities. If your own people don’t understand your strategy, there is no point worrying about your rivals learning your plans. The real threat is that your strategy will fail because it has been botched by members of your own organisation who don’t know how to execute it. Another key challenge is
co-ordination. To implement a big, new initiative, different divisions need to work together. But, according to the same survey, just nine per cent of managers believe they can always rely on other functions and units within the business. “A strategy is more likely to fail because too few people understand it, not too many” The best way to overcome this is a deliberate effort to work on strategic initiatives across departments. A strategy shrouded in secrecy is hardly conducive to this. The obvious solution is to adopt a more open approach to making and sharing strategy. Steelcase, the world’s largest office furniture manufacturer, is a case in point. The company held an online jam to galvanise its 13,000 employees around its new strategy instead of using the usual top-down communication plan favoured by most firms. The 36-hour event in 2017 allowed employees to explore strategy simultaneously. This type of engagement creates personal ownership, as staff can figure out exactly what is relevant for them. They can also make connections with colleagues across the business and overcome the silo mentality that can frequently hinder a strategy. Transparency and inclusion, not secrecy, lie at the heart
Harmon Furr. We are all hard- wired to hate uncertainty, but the authors encourage us to look at the other side of the coin. They guide us from fearing and avoiding uncertainty to embracing it as the origin of possibility. It’s a natural companion of all those who want to leverage open strategy, as openness requires you to embrace uncertainty. Economics of Artificial Intelligence by Ajay Agrawal, Joshua Gans and Avi Goldfarb. This one is not on open strategy but, nonetheless, I have to include it. How do we need to design products and services to make the most of AI? Fundamentally, they argue that the opportunity of AI lies in the decoupling of prediction from decision-making. Power and Prediction: The Disruptive
Streets of Gold: America's Untold Story of Immigrant Success by Ran Abramitzky and Leah Boustan. It may
“The Power of Anomaly” by
Martin Reeves, Bob Goodson, and Kevin Whitaker. This is one of my favourite
be controversial, but most western economies need more immigration. Abramitzky and Boustan use the power of machine learning to sift through millions of immigrant stories and provide a comprehensive picture – a bit like researching everyone’s family history. How does this link to open strategy? Immigrants bring fresh ideas, which is what you are seeking when involving more stakeholders in strategy-making.
recent Harvard Business Review
articles. It’s about identifying the next big thing. Why not do a bit of trend analysis? Don’t! By the time a trend is obvious, it is yesterday’s news. The key is to look at the edges, at small anomalies you can spot, e.g. from customer interactions. And you won’t be surprised that I think open strategy fits well with this.
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Healthcare & Wellbeing
INNOVATION IN HEALTHCARE
Many happy returns? How to help the NHS survive and thrive at 75
Global Online MBA Accelerate your career, increase your business knowledge and leadership skills and maximise your board-level awareness without stepping out of work. Specialise within your MBA with new options in healthcare, sustainability and entrepreneurship. “The emphasis on implementing solutions to real-world problems really makes the MBA stand out.” Adam Doyle Current MBA participant
by Helen Bevan
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Healthcare & Wellbeing
mobilising increasing numbers of people who aspire to a future that’s better than the status quo and getting them involved in change initiatives than it is by top-down schemes. 3 Trojan mice are more effective than Trojan horses. Having many people across the system who can test small, well-focused changes (Trojan mice) nearly always works better than large pilot and roll-out projects (Trojan horses). 4 To gain commitment to act, build attraction to the change . Change that is done ‘to’ or ‘for’ people does not create attraction. Every person is unique and will be attracted to change in different ways. Change needs to be approached one person at a time, even for large-scale change in the NHS. Approaches such as storytelling can act like a magnet to attract diverse groups to a shared view. 5 Real, profound change is difficult unless the space for change is created. People in big systems like the NHS need space for learning, reflection, redesign, and new forms of emergence. That means designing space into organisational processes and routines, through networks, communities, summits, learning debriefs, peer-assists, virtual platforms and huddles. 6 A sense of belonging, built around shared purpose, enables diverse groups of people to unite behind change. Building a sense of belonging is a significant task for leaders in the NHS; for instance, when it comes to retaining people and building cross-boundary groups for change. When people
fter 18 hours in labour, Edna Rees was confused when the midwife stopped telling her to push and urged her to hold on. Too exhausted
feel they belong, and are seen and valued for their own unique selves, they thrive and there is more courage for creativity and new ideas.
many feel for the NHS is often difficult for people from other countries to comprehend. The NHS is the world’s oldest universal health system and one of the largest, managing 1.6 million patient interactions every day. Only five organisations – including Amazon, Walmart, and the People’s Liberation Army of China – employ more people than its 1.5 million staff. It is also one of the most affordable and best-performing healthcare systems globally. The Commonwealth Fund's report, “Mirror, Mirror 2021: Reflecting Poorly”, suggested the UK had a more affordable healthcare system than nine comparable countries (including Germany, France and the US). On performance, only Norway, the Netherlands and
care, longer waiting times, and pressure on emergency care, general practice, and mental health. NHS workers have also been profoundly impacted by their experiences during the pandemic. Recovery is likely to take several years. “The NHS has shown us that successful change doesn’t always start at the top” At the same time, a rapidly ageing population presents increasingly complex healthcare needs, which will require innovative care delivery models. There are significant skill shortages and vacancies are rising. The process of training and upskilling staff, and rethinking job roles, needs to accelerate. Deep health inequalities exist, with significant regional variations in life expectancy and years lived in good health. The pandemic deepened that disparity. The emphasis must shift upstream to improve population health, rather than focussing largely on treating illness. There is agreement that, going forward, healthcare and social care has to be more joined up. We need to think less about ‘services’ and more about ‘people’. This means providing integrated support for the whole person, rather than disjointed hospital services, primary care, and social care. Future patients are likely to be more demanding
and care will need to be more personalised, with greater focus on preventative wellbeing and self-care. Technological and scientific advances are revolutionising healthcare and the NHS needs systems and cultures that are ‘innovation ready’ to ensure that every person who uses NHS services gets consistent, high- quality, evidence-based care. It might seem that these challenges are so significant they can only be addressed by government policies and the most senior NHS leaders. But the history of the NHS has shown us that successful change doesn’t always start at the top. More often, it comes from those with good ideas who test out innovations in local contexts and get better results with the same resources as their peers. While many challenges do need policy-level intervention, leaders at all levels of the system can help to build momentum for another 75 years of success. Here are seven factors, distilled from hundreds of NHS change initiatives, which separate innovations that succeed from those that fail. 1 Relationships are key to delivering change across boundaries. As the NHS moves into an era of integrated care, a focus on building relationships for collective action is even more important. High levels of ‘social capital’ – relationships within and between groups that form trust, connection, and collective capacity – create the strong foundations on which change initiatives can dock. 2 Large-scale change in the NHS is typically the outcome of many smaller cycles . Change is more likely to be achieved by
to argue, Edna complied and baby Aneira became the first baby to be born in the National Health Service (NHS) at one minute past midnight on July 5, 1948. That meant Edna avoided having to pay the midwife one shilling and sixpence. The NHS continues to provide comprehensive healthcare, available to everyone, based on clinical need, not an individual’s ability to pay. Those guiding principles have remained unchanged for 75 years, providing continuity as the NHS has evolved and adapted to meet the needs of subsequent generations.
7 Having constancy of purpose is critical for sustainable change. Many large-scale change efforts in the NHS have just fizzled out. Successful change needs leaders who keep the faith through interest and energy. Don’t meddle when results don’t come quickly and stick with the change priorities. Many of us in the UK cannot imagine a future without the NHS. However, it will need to change significantly to meet the needs of future generations. A special characteristic of the NHS is that it is part organised healthcare system and part social movement. Never underestimate the power of the shared purpose that unites the population, patients and people who work in the service. Whatever challenges the NHS may face, it is our NHS and will continue to be so for years to come.
Learn more about WBS research on Healthcare and Wellbeing.
Today, pressure on NHS services is greater than ever, but social surveys continue to show overwhelming support for those founding principles. The pride, appreciation, and love that so
Australia fared better. But, as the NHS celebrates its 75th birthday, it faces numerous issues. The service is tackling the consequences of Covid-19, including larger waiting lists for
Sustainable Development Goals
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Digital Innovation & Entrepreneurship
MEASURING SOCIAL IMPACT
T wo trends are increasingly shaping firms’ strategies and fortunes. One is technology, with AI dominating the thoughts of executives, policymakers, and commentators alike. The second is social and environmental impact, with current progress falling well short of that required to meet the UN Sustainable Development Goals in 2030. These are not easily reconciled. Technology such as AI is something of a double-edged sword. It provides unprecedented opportunities for growth and prosperity on one hand, but creates significant challenges for business and society on the other. Our research indicates that executives are concerned about the wider effects of emergent technology. But a glaring gap in their strategy toolkit often limits their ability to make social impact evaluation part of their operations and product or service development. With so many companies investing heavily in AI technology and adapting their business models, we developed the Social Impact Strategy Analysis (SISA) tool, following dozens of workshops with 500 stakeholders at a Fortune 50 technology corporation in Silicon Valley, California. The SISA methodology can be used to evaluate plausible risks and benefits associated with AI (or other emerging technologies) across a range of factors such as environment, energy, and society. It is a flexible tool that can be used as an individual or group process to investigate impact on local communities and society in general. Crucially, it is an open process designed to incorporate a range of
Is your AI strategy sustainable?
accidents and healthcare costs against predicted job losses. The final step is to summarise the aggregate results of the SISA exercise. A simple way of doing this would be to use a risk-benefit scorecard covering all the factors. Adopting an open approach to strategy is a fundamental part of the SISA methodology. Rather than top-down decision-making, the aim is to design a bottom-up process. Include a range of stakeholders, from frontline and mid-level staff in other areas of the organisation to suppliers, customers, regulators and government agencies. As well as accessing specialist knowledge, this can create buy-in for a proposed strategy, identify blindspots, and mitigate risk. It is unlikely that any single tool will solve all the strategy challenges an organisation faces. However, adopting an open approach alongside the SISA tool should improve the overall quality of strategy development. It provides organisations with a means of evaluating, representing, and sharing the potential impact of interactions between technology and relevant social factors. Introducing emerging technologies into all aspects of our lives could exacerbate problems within the current capitalist system. But providing the people affected by these technologies with an opportunity to influence their development and use is likely to benefit creators, consumers and society more generally.
by Sotirios Paroutis & Luciano Oviedo Use this tool to find out
stakeholder perspectives, including affected communities, before any innovative technology is deployed. Once the challenge or opportunity has been identified, the SISA strategy can be divided into three stages: the initial setup, understanding the value ecosystem, and the social impact factor analysis. The initial setup consists of four steps: the selection of participants, prioritising social factors for analysis, clarifying the use case, and gathering information to be used in the second and third stages. Our methodology is designed to accommodate up to eight relevant social factors that allow discussion about dynamic interplay, rather than the one-way impact of technology. The second stage establishes the context via three questions. Where are we? This maps out the something of a double-edged sword” “Technology such as AI is
existing landscape for the specific technology. Where might we go? This explores the evolution of that landscape. Why should we go there? This identifies opportunities in that future landscape. For autonomous vehicles (AVs), for example, the platform landscape might include safety and security, autonomy, intelligent manufacturing, and onboard sensors. Exploring the evolution of the landscape might suggest that a shift from ownership and human control to ride-sharing and autonomous systems is highly likely. Finally, analysis of the potential could outline the economic impact of AVs – an estimated £5.5 trillion in consumer and business products and services. Having established the platform landscape and the organisation’s position within it, the next stage is to analyse the interaction between technology and selected social factors. For AVs, that might include energy and environment, with risk-benefit analysis considering the impact on emissions, energy consumption, and the effects of battery manufacture and disposal. Analysis of economics as a factor might weigh potential benefits arising from reduced
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Sustainable Development Goals
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Digital Innovation & Entrepreneurship
TikTok RESPONSIBLE AI AND SOCIAL MEDIA
I t is nearly six years since material about self-harm. Her father criticised the response from social media firms as “underwhelming”. He also warned that he had no confidence that planned legislation would protect other children from the kind of toxic content his daughter experienced, raising the risk of similar tragedies in future. If there is currently no clear regulatory answer, perhaps technology can offer a solution. safer and prevent online harm. This technology is driven by Responsible AI that can oversee and understand the subtleties of both languages and images in a range of settings. Essentially, it is an AI that can understand context. 14-year-old Molly Russell took her own life after being exposed to graphic online We are seeking to build a tool that can keep children This tool could provide an extra layer of insight to shine a spotlight on potentially damaging communications and flag when children are at risk. Content without context doesn’t mean much. Tech giants know this. Yet they are still using a system that flags words and images without understanding who is saying what, and to whom. Knowing what goes through the mind of an individual who is feeling “Every day, millions of parents fear the bleak impact of social media upon their kids”
Can AI protect children online before it’s too late?
by Shweta Singh
suicidal, for instance, is crucial. If technology could make sense of behaviour patterns – what a person is searching for online, who they are talking to and how often, what they are watching, what advice they are not seeking (for example, ignoring suicide helpline links despite numerous recommendations) – it would provide an extra layer of oversight. These are the tools we are building. Harmful or inappropriate content on social media is already weeded out by AI-informed algorithms. But, as we have seen, this level of moderation can be a blunt tool if it is wielded without the necessary level of insight. It flagged one concerned father who sent an image of his son’s genitals to his doctor as a potential abuser. However, it failed to sound the alarm when another man searched 20 times in three days for information on how to kill someone and dispose of a body, before murdering his wife. Without technology, it is impossible to oversee the vast
traffic of images and words exchanged on social media every day. After all, 500 hours of content are uploaded to YouTube every minute. Human moderators cannot keep up with what is often grim and distressing work. Our proposed Responsible AI could provide a helping hand and could be ready as a prototype in a matter of months, offering the first step towards keeping children safer online. We are now sifting through vast quantities of language and images to compile ‘dictionaries’ of insights around each of the most harmful areas that threaten children and young people. These include hate speech, cyber bullying, suicide, eating disorders, child violence, and child sex abuse. We are infusing Google’s natural language processing algorithm BERT (Bidirectional Encoder Representations from Transformers) with an additional layer of knowledge, which can allow the technology to understand language more as humans do.
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Digital Innovation & Entrepreneurship
ADOPTING AI TOOLS
These insights will allow the AI to gauge nuance and context. One friend chatting to another about their frustrations is different from an isolated teenager seeking information about suicide. Intimate photos sent between consenting adults are a world away from those sent by a young girl who has been groomed by an older man. The key is how you distinguish one from the other. Technology platforms – social networks, search engines, and online platforms – could use our technology as an unobtrusive layer of understanding tailored to their own recommendation engines. This means technology that can understand the context of comments, the social bonds that exist between specific individuals, their age, and their relationships. It could flag, for example, the age gap between a man and a girl, the short time they have been online ‘friends’ and the differences between their social groups. “Content without context doesn’t mean much. Tech giants know this” To date, lawmakers have largely allowed social media platforms to mark their own homework. This has prompted outrage, both from those who care for vulnerable youngsters and from defenders of free speech. As ever, the route between moderation and censorship is a tightrope. Meanwhile, in the UK, the Government’s flagship legislation for internet regulation – the online safety bill, nearly four years
How to avoid buyer’s remorse over AI tools by Hila Lifshitz-Assaf
in the making – is treading a difficult path between free speech and protection as it enters what many hope is the final stage. Even if tech businesses know that an extra level of Responsible AI could better govern reams of content, they currently have little incentive to impose it. These are commercial platforms with commercial considerations. Fewer users means less cash. In recent years, whistleblowers have spoken out against Meta’s algorithms and moderation methods and their harmful impact on individuals, accusing them of putting profit over people. But legislators need a better understanding of the technology they are seeking to govern. If they understood what was possible – the power to create ‘intelligent’ technology that reads between the lines and sifts
benign communication from the sinister – they could use the laws they are seeking to pass to demand that internet giants implement these safeguards. For every high-profile case such as Molly’s, there will be hundreds – probably even thousands – of children who are severely traumatised by harmful content they encounter online but do not make the headlines. Every day, millions of parents fear the bleak impact of social media upon their kids. It is our responsibility to protect them, and we are running out of time to do it.
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