Strategy E-Book

Fredmund Malik

• Herausgeber: Campus Verlag
• Kategorie: Fachliteratur
• Sprache: Deutsch
• Veröffentlichungsjahr: 2016

Seitenzahl: 525

Beschreibung

This book describes Malik's strategic solutions for the Revolutions of the New World, which are already underway. They are part of the Great Transformation 21 which the author will address in the book. In the six parts of this book, he will first look at the dynamics of the Great Transformation 21, its inherent risks of crisis and its opportunities, as well as the labor pains that the New World is suffering. After that, he will deal with the amazingly effective cybernetic systems for strategic navigation and the Strategy maps required for that, as well as the empirical quantification of businesses, both existing and yet unknown, which will help break the new territory of innovation. Finally, Malik will reveal the patterns that the tidal currents of great transformations invariably follow, as well as the economic dynamics resulting from them and the strategies required to deal with them. In the last part of the book he will describe the revolutionary new methods that enable us to master groundbreaking strategic change with great precision and unprecedented time compression - at the "speed of light", so to speak. This way, even enormous corporate growth and size can be managed and turned into true strengths, with perfect ease and using innovative approaches where conventional approaches have proven useless.

Leseprobe

Fredmund Malik

Strategy

Navigating the Complexity of the New World

Translated from German by Jutta Scherer,js textworks (Munich, Germany)

Campus Verlag

Frankfurt/New York

About the book

Reliable Strategies for Mastering the Great Transformation21

The development of Fredmund Malik’s strategic framework was a result of his early realization that both business and society are experiencing one of the greatest transformations in history – a process he calls »The Great Transformation21«.

Malik noticed and addressed the financial and debt crisis from the outset. He was one of the first to realize that its primary causes were neoliberalism and a misplaced focus on shareholder value. This focus caused leaders to pursue the wrong strategies, eventually resulting in one of the greatest misallocations of economic and social resources in history. In response, Malik devised innovative strategic tools that allow the crisis to be used as a springboard for repositioning organizations and enacting structural reform. Precisely addressing the complexity of strategic challenges, Malik’s management framework provides a comprehensive toolkit that facilitates the successful navigation of organizations in any economic environment.

Vita

Fredmund Malik is one of Europe’s leading authorities on management. The bestselling author’s work represents a standard of professional management that can be both taught and learnt. Malik’s thinking goes beyond economics and draws inspiration from modern sciences of complexity, particularly cybernetics. He is an expert on corporate governance practice and an adviser to executives at the highest levels of international leadership. Fredmund Malik was Professor at the Swiss University of St. Gallen and Guest Professor at the Austrian University of Economics and Business in Vienna. He is Honorary Professor at three renowned Chinese universities and member of the European Academy of Sciences and Arts. His honors include the Heinz von Foerster Prize for Organizational Cybernetics and the Austrian Award of Honor for Science and the Arts, awarded for his wholistic management systems.

Contents

How I Look at Management

Right and Good Management, in My Definition, Is…

… the function of society which enables its organizations and systems to function properly

Management—Mastering Complexity

Management—Operating System for Organizations

Management—Profession of Effectiveness.

Preface

Strategic Solutions for REvolutions

The New Challenges

The Right Knowledge

Chapter IntroductionThe Right Strategy for the Great Transformation21

The Revolution in the Great Transformation21

Innovative, Intelligent and Right Solutions

Strategy: Navigating Effectively Through the Complexity of the Great Transformation21

Key Propositions

A Word On the Terms Used

Part I:Strategy for the Great Transformation21

Chapter 1What Strategy Looks Like When the Future is Unknown

Chapter 2The Great Transformation21

The Old World Ends as a New World Is Born

Megachange in Megasystems

The Current Crisis as the New World’s Birth Pangs

It Takes More than Economics to Understand the Global Economic Crisis

Anglo-Saxon Corporate Governance—A Machine of Destruction

Complexity and Management Crisis: The Absence of Neuronal Systems

Third Act of the Crisis: Deflation

The New Way of Functioning: Mastering Complexity

Chapter 3When You Do Not Know What You Need to Know: The Minefield of Strategic Errors

Strategic Delusion by Operational Data

The Right Kind of Information Is Lacking

Conventional Strategic Wisdom Is Wrong

Too Much Emphasis on Financial Figures

Misleading Time Horizons

Profit, Fitness, Viability

Operational and Strategic

Operational and Strategic Management

1.Operational data are systematically misleading in corporate management.

2.The control and information systems used by business economics, in particular finance and accounting, provide operational data only.

3.The brighter the picture painted by operational data, the greater the risk of strategic mistakes.

4.Strategic mistakes are irreversible.

5.Strategic mistakes cannot be corrected because time is working against you.

6.Operational data are strategically insignificant because they cannot support or refute a strategy.

7.What may appear reasonable based on operational data can be utterly wrong strategically—and vice versa.

Strategic Thinking Traps

Why Growth is Not an Aim but a Result

Size Will Have Two Faces

Diversification Requires Skillful Complexity Management

Eliminating Deficiencies is Hardly a Strategic Goal

Right Strategies are Resistant to Inaccurate Data

The Best Strategies Do Not Depend on Forecasts

Buzzwords and Empty Phrases Get in the Way of Good Strategies

Part II:Strategy as Master Control in the Wholistic Management Systems

Chapter 1Making Companies Function Well

Enhancing Management Impact Through Management Support Systems

Right and Good Management—Universally Valid

Management, Financial Markets, and Alpinism

A Practical Hint for Readers in the Know

What are Master Controls?

The Basic Management Model and Its Basic Concepts

Management of Institutions: The General Management Model

Management of People: The Standard Model of Effectiveness, or “Management Wheel”

The Integrated Management System—IMS

Integrated Strategy as a Top Cross-Divisional Function

Chapter 2Providing Direction Through Corporate Policy and Business Mission

The Right Purpose

Using the Corporate Purpose to Self-Program for Success

Focus on a Healthy Business

What is Our Purpose?

The Right Mission

The Three Elements of the Right Business Mission

What the World Lacks: The Need

Where We Are Better Than Others: The Skills

What Moves Us Deep Inside: The Beliefs

Emerging From the Interaction of Elements: The New Whole

Business Mission in a Systemic Overview

Focus as an Effect of Master Control

The Right Performance

Central Performance Control (CPC)

The CPC Complex and Its Threefold Function

Part III:Mastering Complexity Through Reliable Navigation in Any Circumstance

Chapter 1Revolutionizing Strategic Navigation

The Malik-Gälweiler Navigation System

The Right Strategy for a Future Unknown

Putting an End to Arbitrariness in Strategy Design

Looking Further Into the Future—Without Forecasts

Time Constants and System Dead Time

Limitations of the Market Economy: Why Economists Do Not See Far Enough

What Must Be Monitored: Variables for Control and Orientation

Reliable Function With Cybernetic Control Systems

Chapter 2Reliable Control Through Cybernetic Navigation

First System Level: Liquidity

Market Economy Means Survival by Paying Bills

Controlling Liquidity

Liquidity Is Always Short-Term

Looking to the Future By Switching System Levels

Protection against Preprogrammed Control Errors

Early Warning and Anticipatory Control

Second System Level: Profit

Extending the Time Horizon

Exploring the Second System Level: New Information for Orientation

Third System Level: Current Profit Potential (CPP)

From Operational to Strategic Management

Switching to the Strategic Business Unit (SBU)

Exploring the Third System Level

Quantifying Potentials: Actual ROI versus Par ROI

Experience Effect and Defendable Market Position

Quantifying Profit Potentials: PIMS Research

Fourth System Level: Future Profit Potentials (FPPs)

When Even the Best Market Share Gets You Nowhere

Greatest Innovation and Most Dangerous Competition

Exploring the Fourth System Level

Substitution Concealed by Innovation Masquerade

The Archimedean Point of Every Strategy

Coming Full Circle—Back to Corporate Purpose and Business Mission

Circle of Survival and Viability

Chapter 3Setting the Right Strategy, Irrespective of Economic Climate: The Strategy Map

Brain-Like (Re-)Organization of Knowledge

The Strategy Map

Strategy as Interface and Cross-Border Function

Strategy Map for Right Action

The Solution-Invariant Customer Problem

Original and Derived Customer Problems

Surfing the Tidal Wave

Drivers of Megachange

Solution Technologies

Solution Technologies Existing in the Market

Own Solution Techniques

Future Solution Technologies

Socioeconomic Trends

Market Position

Market Development

Market Share Targets

Own Growth

What Makes Growth Sustainable? Distinguishing Healthy From Unhealthy Growth

Marketing Objectives

Investments and Cost Reduction Potentials

The Experience Effect

Research and Development Objectives

Finance and Balance Sheet Variables

Part IV:Following the Change: Success Factors for Your Current Business

Chapter 1No More Blind Flying: PIMS— The High Art of Strategy Development

Strategic Leadership

The PIMS Revolution

Strategy at the Strategic Business Unit Level

Discovery of the “Laws of the Market Place”

A Brilliant Research Idea: Profits Are Driven by Structure, not the Industry

New Benchmarking Based on the Biological Pattern

The PIMS Database Suites

Universally Valid Factors Determine Seventy-five Percent of Profits

Answering Key Questions of Strategy

Eight Key Factors for Success

Chapter 2Strategic Core Knowledge: A Cornucopia of Insights

Market Position

Stability of Results Over Time

A Seeming Anomaly Triggers Discovery of a New Factor

Is Innovating a Good Thing?

Where Many Businesses Lose Earning Power Without Even Noticing

How Important Is Market Growth?

Systemic Interconnectedness of PIMS factors

PIMS and the Six Central Performance Controls (CPC)

The Cybernetics of PIMS Strategy Development

Overview: Benefits of PIMS Findings for Top Management

Criticism of the PIMS Program

What Remains Valid in Business When Everything Changes

Chapter 3Breaking Strategic Barriers: Three Pioneering Models From PIMS

Knowing the Potential of a Business: The PIMS Par Model

Performance Assessment, Bonuses, Staffing Decisions, and Corporate Culture

How Looks Can Deceive: Which Business Units Needs What Strategy?

Learning From Winners: The PIMS Look-Alike Model

Learning From Winners

How Everything Fits Together: MG Navigator and PIMS Par Model

The Customer Value Map: Using Customer Value and Competitiveness as Reliable Guiding Stars

The Customer Value Map: Relativity Theory of Customer Value

First Dimension: Double Relative Quality Triggers Customer Preference

How Customers See the World

Second Dimension: Relative Price

Fourfold Value Analysis: Self-Image and Public Image, Customers and Non-Customers

What Drives the Buying Decision?

Feedback Process until the Value is Right

Part V:Ahead of Change: Success Factors for Your New Business

Chapter 1Constants in the Currents of Change

The Magic of Patterns that Connect

We, too, Will Be Replaced: Creative Destruction

Symphony of S-Curves: Seeing the Future Clearly

Simple Growth Processes

From Growth to Substitution

When Several Systems Compete for Existence

Discovering the Secret Driver of Epochal Change

Centennial Cycles: Invention—Innovation—Substitution—Exploitation

Was Kondratieff Right? The Rhythm of Long Economic Cycles

Self-Destructing and Self-Creating Systems

Chapter 2Innovating for the Great Transformation21: How to Preprogram Success

From the Art to the Craft of Innovation

Misconceptions About Innovation

Error 1: Innovation is Made in Labs and R & D Departments

Error 2: Creativity is a Key Factor

Error 3: Innovation is Purely or Largely High-Tech

Error 4: Only Small Companies Are Innovative

Error 5: Innovation Requires a Certain Type of Personality

Chapter 3Mastering Even the Unknown: The PIMS Start-up Strategy

Start-ups as a Synthesis of Several Arts: The Secrets of Innovation Success

What Makes a Business New?

How Long Does it Take for a Start-Up to Be Successful?

How Best to Put New Things on the Market? The Optimal Start-up Strategy

True Professionalism in Start-Up Management

Maximizing Start-Ups’ Chances of Success

The Right Environment for Start-up Businesses

Strong Growth Makes Innovation Successful

Innovating is Easier in Markets With Few Customers

Choosing the Right Strategy in the Right Environment: Knowing, Not Guessing

Aggressive Marketing is Key

Maximizing Customer Value

Pricing is Less Critical

Getting Prepared for a Second Take-off

Chapter 4Implementing Start-up Strategies: Basic Rules for Effective Innovation

1.Go for the Top: Market Leadership and Distinct Changes

2.Make Room for New Things

3.Separate the Old From the New

a) Different Yardsticks

b) Different Budgets

c) Different Schedules

d) Different Reporting

e) Go and See for Yourself

4.Look for Opportunities in Problems

5.Ask Controllers for a Second “First Page”

6.Write Down Your Expectations

7.Determine Cut-off Points

8.Make Sure You Have the Best People

9.Run Tests

10.Strictly Focus on a Few Things

Part VI:Revolutionizing Management Methods: Strategic Approaches Without Time or Space Limits

Chapter 1Direttissima: Taking the Most Direct Path to the Right Strategy

Chapter 2Revolutionizing Change With the Syntegration Method

Epoch of New Leadership: Quantum Leap in the Social Technology of Functioning

Change and Innovation—Swift and Effective

What is the Syntegration Method and What Does it Accomplish?

Applications

Typical Key Questions for the Syntegration Method

Simultaneous High-Performance Approach for Solving Complex Questions

Change of Mood and Energizing the Organizational Culture

Syntegration Pays For Itself

Pushing into the Vacuum Between a Small Team And a Large-Scale Conference

Cybernetically self-regulating communication process

Non-hierarchical cooperation

The Whole and Its Parts

The “Magic Formula”

The Brain of the Firm: Brain-Like Function Through Cybernetic Interconnection

The Integrated Architecture of Syntegration

The Right Time for the Great Transformation

The Way to New Prosperity

Democracy is Reaching the Limits of Complexity

Chapter 3The Cyber-Tools

SensiMod: The Sensitivity Model As the Organization’s GPS

Modeling the Company’s Business as a Cybernetic System

Discovering the Invisible Cybernetics of the System

The “Spaghetti Model”

Application of the CPC, Quantification With PIMS and S-Curves

The Inner Model of the Outside World

EKS: Dynamic Specialization

Successful Application Examples

EKS-Based Specialization: One Law of Nature, Four Principles, Seven Steps

The EKS Success Spiral Market Leadership and Unique Position

Management System Audit (MSA): New Ways of Functioning and Implementing

Using Traction Assistance to Produce the Right Results

What the MSA Management System Audit Can Do

What the Result Looks Like

Full Integration of Management Systems and Tools

Operations Room: Implementation With Real-Time Control

Creating the Best Conditions for Implementation

New Approaches to Implementation: Systemic Interconnectedness of Measures

Using Sensitivity Modeling to Create Systemic Balance

Implementation With Syntegration Roll-Out at Country Level

Real-Time Control From the Operations Room

Chapter 4How Even Giants Learn to Dance: HyperSyntegration

The “Mother”-SuperSyntegration: First Generation of Change

Parallel Applications for Larger Numbers of People

From Syntegration to HyperSyntegration: Second Generation of Change

Moving Mass at the “Speed of Light”

The Universe of Exponential HyperSyntegration for Global Megachange

Appendix

Concept and Logic of the Series “Management: Mastering Complexity”

The Whole and Its Parts

Scientific Foundations

When Language Reaches Its Limits

Redundancy

Illustrations

Browser Technology

The Malik Management Systems And Their Users

Terms Used and Identities

The Beginnings

Development History

Applications and Effects

Autonomy for Management and Managers

Modularity and Interfaces

Management Systems for Self-Thinkers

Success Potential Increases with Qualification

Self-Motivation for Self-Developers

Responsibility versus Recognition

Authors and Credits

What Readers Need to Know in Order to Understand this Book Series

Success Programming Its Own Failure

When Thinking Fails to Grow With Practice

Problems Related to Success and System Laws

Old and New Sources of Knowledge and Insight

Using Cybernetics to Understand the New Solutions

Two Leaps of Evolution

New Success Levers: Taking Advantage of Complexity

Right Management Is Cybernetic Management

Glossary

Termin protected by trademark and copyright

About the Author

Selected affiliations

Selected awards

Bibliography

Index

For the early thinkers on accurate navigation and reliable strategies for theGreat Transformation21:

Aloys Gälweiler, Cesare Marchetti und Sidney Schoeffler

How I Look at Management

Management is the driving force wherever a number of people pursue common goals they can only achieve by sharing the work and the knowledge.

Management is also the governing body in any institution of society—whether it is a business enterprise, a university, a hospital, a public authority, or any other kind of organization.

It is management’s duty to give direction to those managed. This includes thinking through the organization’s mission, determining its objectives, and organizing its resources for the results to be achieved.

Management is the organ of society which makes everything function properly.

Right and Good Management, in My Definition, Is…

… the function of society which enables its organizations and systems to function properly

This also includes responsible leadership and governance.

It takes right management to effectively transform a society’s resources into meaningful results and value. Under this comprehensive concept, management also includes enabling people to make their contribution to the proper functioning of their organizations. As such, management provides purpose, orientation, structure, and performance, thus implementing political and societal responsibility and ethics.

Management—Mastering Complexity

One of the greatest challenges for management is presented by the exponentially growing complexity and dynamic change of today’s globally interlinked systems. These profound changes are what I refer to as “The Great Transformation21”1.

Management, in my mind, is mastering complexity, which is why I chose this title for my six-volume book series. It is the perspective that provides the most effective access to management in all its aspects and enables us to find the best solutions.

As far as the scientific foundation is concerned, my management systems are rooted in three sciences of complexity: systemics, cybernetics, and bionics. I see systemics as the theory of the coherent whole, cybernetics as the theory of functioning, and bionics—at least the way I use it—as enabling managers to transfer nature’s evolutionary solutions to their organizations in order to maximize performance.

This is what makes my management theory so very different from conventional approaches: It provides clarity where there is currently confusion, contradiction, arbitrariness, and the indiscriminate adoption of management fashions. Above all, I have long taken the subject far beyond the teachings of business theory and business administration, which has led to fundamental management innovations and provided new solutions to a number of management problems.

Management—Operating System for Organizations

In terms of its significance and impact, management is comparable to the operating systems in computers. Just like the proper function of a computer is enabled by its operating system, the proper functioning of organizations is enabled by the “operating system called management.” In my view, right management is the operating system for organizations of any size and kind—a system that is capable of evolving.

Management—Profession of Effectiveness.

Managers are the people who fulfill this function and pursue it as a profession. This includes doing what is right for the organization, and doing it well. That is why consider management to be the profession of effectiveness in complex systems.

For people in the 21st century, it is just as important to master the basic skills of right management and self-management as reading and writing have been ever since the 18th century. Today, management is the key competence that makes people employable and effective in organizations. In any organization, accomplishments on the job are predominantly owed to what I call “right and good management”. It is the key prerequisite to ensure that, in addition to economic resources, also things like talent, intelligence, creativity, information, knowledge, and insights are transformed into results.

Management for people and management for organizations are the dimensions of applying my wholistic management systems. They help create the conditions in which people can transform their strengths into performance, and thus to be successful and to find meaning and fulfillment in their work.

St. Gallen, 2013

Fredmund Malik

Preface

Strategic Solutions for REvolutions

This book describes my strategic solutions for the REvolutions of the New World, which—although already under way—have yet to be recognized for what they are. That is why most of the measures taken so far are ineffective, with some even having a destructive impact on society.

What I call the New World will be the result of one of the largest global transformations of business and society that has ever taken place. I call it “The Great Transformation21”.2

The New Challenges

This transformation involves the danger of a social meltdown. At the same time, it also offers a chance for a new economic miracle to bring about a better and more humane social order where organizations function reliably.

What particular course this development will take depends, among other things, on the solutions, methods and tools that leadership elites worldwide can resort to in facing these challenges. It depends on which of the solutions at hand they can identify as genuine solutions, and which they ultimately opt for. One thing is certain: conventional means will not suffice to master the complexity of this transformation, as they have caused much of the current global crisis.

A strong driving force arises from the strategic solutions themselves that I am presenting here. They contribute their share so the upcoming revolutions will happen quickly, while—contrary to previous revolutions—manifesting itself as an innovative breakthrough rather than a violent upheaval.

They liberate us from both, long outdated forms of management and organization and the grotesque limitations of todays’s social and political problem-solving processes.

Since 2011 my “Manifesto for Corporate REvolution” has been laid down in my book Corporate Policy and Governance, the second volume in my series Management: Mastering Complexity. Many of the developments outlined there—and even before—have meanwhile materialized, first and foremost the beginning collapse of the financial system. Further profound changes, such as in technology and the sciences as well as in people’s social value structures—in particular those of the younger generation—, in their perspective on and perception of the world, have progressed to a point where they cannot be stopped anymore, so they should be accelerated instead and directed along more constructive paths wherever possible.

So, what most people believed impossible at the time of the above publications became a reality just a few years later. In 2008 I wrote that knowledge would outrank money and information would outrank power. The ongoing self-destruction of the financial system proves my first point; the ever-increasing global impact of the social media proves the second. Ruling and leading will never be the same again.

The financial crisis itself, however, will not be a central topic in this book. I have published everything that needed to be said in this respect in the course of the past 15 years; now I let the facts speak for themselves. The scenarios I have presented—some of them as early as in the 1990s—have come true. The basic pattern of this development is “deflationary depression”, accompanied by social impoverishment and revolution—that is, unless economists and politicians do a radical rethink and change their course of action. That is why this book is dominated not so much by analyses as it is by solutions and the tools required for implementation.

The Right Knowledge

The knowledge society in the stricter sense is another topic I will not elaborate on here. I have addressed it in my book Corporate Policy.

Rather, what I make available here is the strategic knowledge that enables top managers in all kinds of organizations to tackle the challenges of the Great Transformation21 reliably, quickly, and effectively. The means to do that are my Management Systems® and the navigation, information, and control systems they include, as well as my strategy concepts and about a dozen new and greatly improved methods and tools.

Many of the pioneers among the top managers applying my management systems are left speechless by the power and speed at which problems are solved and more and more often resolved. Particularly effective are the high-performance processes of the social technology of Syntegration which helps master even huge and highly complex challenges better than ever before.

Just like in earlier phases of epoch-making transformation, almost everything is going to change fundamentally and radically. But while past revolutions were driven by machines, the imminent revolution will be driven by a new functioning of societal organizations, of their management at all levels, of their strategies and methods—including the levers of cybernetic self-organization and self-control.

My cordial thanks go to Mag. Tamara Bechter and Dr. Sonja Böni for their enormously professional support with the new edition of what are so far three volumes of this series. Without their help I could have hardly accomplished the task.

St. Gallen, 2013

Fredmund Malik

Chapter IntroductionThe Right Strategy for the Great Transformation21

The Great Transformation21—as I have been referring to the transition from the Old to the New World—will be larger than any other social transformation we have seen so far, as it will span the entire globe.

The more intensely I studied the effective but also explosive power of the Great Transformation and the relevant strategic solutions, the tighter became the limits of language. Describing the complexity of globally interconnected systems and finding words for the simultaneousness of their change dynamics is just as difficult a task as putting a Beethoven symphony in words. Wherever I turn there is a lack of terms to describe the new, its many forms and dimensions, and above all the enormous speed of change as well as the unknowable that comes with it.

The usual superlatives—all the “super” and “mega” terms—, even if they were not as trite as they are, would never suffice to capture the scope of the Great Transformation. Apart from that, these terms originated in the Old World, so they can hardly convey any more than the Old World’s limited power of imagination. Still, occasionally I have to use these terms for lack of better ones (at least to date).

If, for instance, the new methods introduced in this book enable even the most complex decisions to be taken and implemented 100 times faster, to increase team efficiency by more than 80 times, and to find solutions based on maximum consensus in just three days where even the smallest compromise was previously blocked by social gaps, and if this power of solution has led to success in hundreds of applications, without exception—what terms could be considered adequate for such achievements, when the aim is to describe the new dimensions of effectiveness but avoid both grandiloquence and advertising slang?

Historically, previous transformation of a similar kind—in particular in technology and science—have always spawned a new language because the new could not be put in old words. In the social and political sphere, however, new terms will often gain ground when the change itself progresses, or even later than that. For instance, people in the Renaissance age did not know they were experiencing the Renaissance—a term coined as late as in the 19th century. And it was more than 10 years after Columbus had landed in “India” (1492), in 1503, that someone else realized that a “mundus novus”, something completely new, had been discovered—a fact that never occurred to the discoverer Columbus himself in his lifetime. Amerigo Vespucci had never set foot on the continent called “America”—which, however, was rightfully named after him, for he was the one who ultimately identified it.

The Revolution in the Great Transformation21

The Great Transformation from the Old to the New World will fundamentally—and almost completely—change what people do, why they do it and how they do it. It will also change who we are and what concept of the world we have.

It will revolutionize the way society and its organizations function. Functioning twice as well at half the money is just one of many challenges that most people consider impossible to solve—although its solution is already being practiced.

In just a few years’ time it will be with incomprehension and pity that we think back of the sluggish political decision-making processes we have today, of coalitions getting in their own way, of corporate management bodies paralyzing themselves, of slowly moldering change processes, of lethargy and resignation in so many organizations, of monstrous mega conferences that had no impact, and of the cluelessness of global organizations.

With the challenges we are currently facing and which seem to have appeared out of the blue—such as the complete turnaround in energy policy, the rotten financial system, the global debt mountain, and the increasing decay of the social fabric—the limitations of our present problem-solving approaches have become more obvious than ever.

The leaders of these organizations will be pitied and admired at the same time for having given their best and having tried to do their duties even under such inhumane conditions—although their efforts have increasingly failed, as even the most outstanding driver cannot win a race if he is given an outdated car.

Innovative, Intelligent and Right Solutions

At the same time, people will wonder why the new solutions were not made available to those leaders much earlier, in particular as they had long been published by us and applied successfully in hundreds of cases. Anyone who knows these solutions will immediately see how they offer new ways to end crises, and even to use these crises to make inroads into the New World.

For me, the ethical mission resulting from all that is to ensure with all my might that the necessary information about these new, global, society-saving solutions will be spread.

The funds to be freed up by the new solutions—and which are presently and pointlessly tied up in old structures and processes—will be used to create the innovations of the New World, instead of continuing to finance outdated approaches from the previous century.

For instance, one key task will be to establish the new type of high-performance educational institution—preferably outside the current educational system, as this will be the fastest way—and teach the new generation right from the outset of their student careers the leadership skills that, had they been in place, would have had the potential to prevent the current calamity. They include wholistic and networked thinking, familiarity with systemics as the science of entities, practical application of cybernetics as the science of functioning, and the ability to leverage bionics by using evolution’s best solutions to innovate societal organizations.

This would strengthen our social solution intelligence by several orders of magnitude, because all of the above can be accomplished in less than half the time and in one integrated and in itself fully compatible study course.

The present book—just like the other volumes of the series Management: Mastering Complexity—presents the knowledge and approaches required to prevent the immiment social disaster and bring about new prosperity as well as a well-functioning social order well beyond the current political categories of left-wing and right-wing.

Strategy: Navigating Effectively Through the Complexity of the Great Transformation21

In the six parts of this book, we will first look at the dynamics of the Great Transformation21, its inherent risks of crisis and its opportunities, as well as the labor pains of the New World.

After that, we will deal with the astonishingly effective cybernetic systems for strategic navigation, the strategy maps required, and the empirical quantification of existing and new businesses from where the new territory of innovation will be explored.

Finally, I will show the invariant patterns in the tidal currents of great transformations, as well as the resulting economic dynamics and the strategies to deal with them.

In the last part of the book I will describe the most revolutionary tools for social change known to date: the social methodology of Syntegration, which enables us to master ground-breaking strategic change with great precision and “at the speed of light,” compared to conventional approaches, The Syntegration technology helps to manage the growth and size of companies with ease and even turn them into strengths, specifically in cases where conventional approaches have proven to be futile and to paralyze rather than strengthen organizational performance.

The almost magic efficacy of these methods is based on cybernetic communication processes which, to an extent previously unimaginable, enhance collective intelligence and generate social energies. The simultaneous use of innovative system design tools creates highly effective intelligence and power centers for successfully mastering the challenges of even hypercomplex systems as well as their control and regulation. “Mega Change of Mega Systems at Mega Speed” will then turn out to be more than just a pretentious advertising slogan, instead denominating a program to open a bright future in a New World.

The topic threaded throughout the entire book series is how to master the Great Transformation21 and its unprecedented complexity. In the following graph, this complexity is depicted by means of the double S-Curve, indicating the substitution of something new for something old. The Old World is replaced by a New World.

This replacement generates the revolutionary socio-political and economic distortions and crises we are faced with today. They represent the labor pains of a New World.

This third volume of the series Management: Mastering Complexity, I describe how the right strategy contributes to the development of an effective solution.

Figure 1: The Great Transformation21

Key Propositions

Both the world of business and society as a whole are going through one of the most fundamental transformations that ever occurred in history. An Old World ends as a New World is born.

The global economic crisis is part of the New World’s labor pains.

Main causes of the global economic crisis were the wrong corporate strategies pursued in the Old World, as well as its traditional management and corporate governance concepts. They were less and less able to cope with the present complexity and dynamics of globally interconnected systems. Misguided economic policies were of minor importance.

The self-destructing corporate strategies became visible almost over night when leading financial institutions collapsed and their management systems failed.

The wrong strategies previously pursued were based on misleading success criteria. They encouraged management behaviors that were harmful to the system and affected large parts of it. This caused a historically unprecedented global misallocation of resources as well as the greatest debt load of all times and across all segments of society.

Therefore, effective solutions for the global economic crisis have to comprise much more than government-level programs: they have to encompass a new way of functioning for societal organizations as well as a profound change in the currently dysfunctional control loops which can be accomplished through new management systems. Solutions meeting these criteria are the cybernetic-wholistic management systems and the strategy concept described in this book.

The best model for the new functioning and the new management required for it is provided by natural organisms with their communication and control systems, their sensory and neuronal systems. Their cybernetic laws of function have been integrated in my Wholistic Management Systems and the associated strategy concept.

Strategies for complexity have a very different logic and very different points of reference compared to the Old World’s traditional strategies. They leverage the logic of evolution, and are thus set up to successfully deal with the unknown and the unknowable.

My strategy concept focuses on two areas:

At the operational level of companies, it indicates the right direction with utmost precision and at maximum speed

At the management level, it brings about the new functioning through flexibility, adaptability, and coherence, while at the same time ensuring viability through self-regulation and self-organization. The control principle is real-time control

Its foundation is a new kind of knowledge and new methods for enhancing intelligence and innovation in information, communication and management processes, based on insights from bionics and cybernetics which are now applicable to management.

Under this new strategy concept, navigation parameters that have proved useful are kept on board but are integrated in a more comprehensive, wholistic management and navigation system. In that system, they are reconfigured to obtain new meanings, and thus to have different control effects in the system of corporate management. For instance, profit and growth will continue to be important in the New World, but they will assume another function.

Reaching beyond economic dimensions, the new strategies will also provide solutions for the non-economic problems related to increasing societal disorientation and instability, as well as for mobilizing human energy, performance, and creativity. By cultivating new values, the new strategies will bring a new motivation for people. One focus of the new strategy will be a new meaning.

Together with other elements of my management systems, the new strategy concept also leads to a new social and economic order. I call it the New Functionism. This new order replaces both capitalism and socialism, as their traditional polarity prevents effective solutions for the new challenges. However, the New Functionism will comprise the best of both previous social orders: e.g., the performance principle from capitalism and the principle of solidarity from socialism.

A Word On the Terms Used

In addition to the glossary in the appendix section, it is important to explain a few terms at the beginning of each volume.

Bionics Coinage combining “biology” and “technics.” It refers to the interdisciplinary field of research which studies nature’s evolutionary solutions to apply their principles for the benefit of humans. So far, bionic findings have mainly been used in the field of technology. However, nature’s solution can also be applied to management, e.g. to improve the functioning of organizations.

Control and Orientation Variables are terms used in the Malik-Gälweiler Navigation System. Control variables are the parameters an organization needs to get under control; orientation variables are the pieces of information which indicate whether the organization is under control.

Creative Destruction Term created by the Austrian economist Joseph Schumpeter. It refers to entrepreneurial innovativeness and the resulting large-scale substitution processes where the existing is replaced by the new.

Cyber-Tools Methods and approaches to diagnose and shape the cybernetic functionality of organizations.

Direttissima Name I use for the—methodically—fastest way to the right strategy.

Functioning is the most general term I could find to describe the reliable and optimal working of an organization in line with its basic purpose.

Great Transformation21 Profound secular transformation of business and society into the 21st-century society of complexity. What exactly this transformation entails is described in my 1990 book entitled “Krisengefahren in der Weltwirtschaft” “Risks of Crises in the Global Economy”, and ever since then on a regular basis in my monthly management letters. The first time I used the term was in my 1997 book on corporate governance entitled “Wirksame Unternehmensaufsicht” “Effective Corporate Governance”, where I dedicated a chapter to the dimensions of the ongoing metamorphosis of business and society, which was already recognizable back then, and on that basis presented my suggestions for right and good governance.

The term “Great Transformation” was first used by the Hungaro-Austrian economic sociologist Karl Polanyi in 1944. He used it in a similar sense but referring to a completely different era and to different manifestations, above all the spread of market economics and the nation state. Also, Peter F. Drucker used the term “transformation” in the headline of the introduction to his 1993 book “Post Capitalist Society,” where he sketches out, among other things, the great lines of development of capitalism to the knowledge society and from the nation state to the transnational mega-state.

By choosing this term, I am integrating some of its previous meanings to describe the generalized concept of a fundamental transformation process in the 21st century—a process characterized, among other things, by proliferating complexity, the emergency of globally interconnected systems and the dynamics of self-accelerating change. As a result, we are facing historically new challenges. Mastering them will require radically innovative bionic forms of organization, cybernetic systems for management, governance and leadership, and social technologies of no less than revolutionary effectiveness.

Innovation Phase in which something new, by being introduced to the market, starts to become effective in society.

Institution Most general term used for all kinds of societal organizations, both in business and the public sphere, as well as for the systems and rules guiding social behavior. In this sense, a business enterprise is both an institution and an organization.

The Integrierte ManagementSystem (IMS) One of the three basic models in my management systems, along with the General Management Model (GMM) and the Managerial Effectiveness Model (MEM).

Invention Stage within the overall transformation process in the course of which innovations are developed—from first inception to market launch.

Malik Gälweiler Navigation system / MG Navigator Complete and universally valid system for developing an effective strategy and reliably steering an organization.

Management System Audit MSA Method to reliably analyze my Integrated Management System (IMS) in an organization.

Master Controls The most fundamental regulations effective in an entire system, all the way to its peripheral elements, irrespective of their source—be it laws of nature, structural conditions, or man-made regulating decisions in the sense of principles or guidelines. The most important Master Controls are decisions and principles that bring about the cybernetic self-capabilites of a system, which are self-regulation, self-organization, self-direction, and self-control.

Old World and New World Pair of terms relating to the fundamental and secular change I refer to as “the Great Transformation21,” in which the existing order is replaced by a new order.

Operational and Strategic Terms to describe the levels of reliable navigation of an enterprise or organization

Operations Room Informational sensory environment in which real-time decisions are made and implemented.

PIMS Look-Alike Term used in PIMS research to describe the similarity of businesses.

PIMS Par Term used in PIMS research, referring to the indicators of potential performance as opposed to actual perfomance.

Profit Impact of Market Strategy PIMS So far the largest empirical-quantitative strategic research program ever carried out worldwide, in which the “Laws of the Marketplace” were discovered for both existing and new businesses, or start-ups (see Volume 3, Parts IV and V).

(R)Evolution Coinage made up of “revolution” and “evolution.” I use the term to describe a) the ongoing, profound changes taking place in the course of the Great Transformation21 and b) the innovations in management, leadership, governance, as well as their rules, systems and tools, that are required to cope with these changes.

S-Curves Describe the typical, S-shaped course of healthy growth processes.

Sensitivity Model® (SensiMod®) System-cybernetic procedure used to model the cybernetic regulation loops in complex systems and their cause-effect relationships. Its early development was under the guidance of Frederic Vester.

Solution-Invariant Customer Problem One of the key terms and the “Archimedian point” of corporate strategy. It refers to the motive for a purchase, irrespective of existing solutions. For instance, a wrist watch is one of several possible solutions to the solution-invariant problem of indicating the time.

Start-up Business Stage of a strategy that begins when something new, after having been invented and developed, is put on the market. The start-up phase markes the beginning of the actual innovation, which must always be defined based on market success and which requires a very specific strategy.

Strategy Acting the right way, even when we do not know what the future will bring, and the rules required for right action. Strategy determines the path of development for an institution. The right strategy lays out the principles and guidelines that will guide an organization’s activities in the long run. These principles and guidelines will be changed as newly arising circumstances require.

Substitution Something existing being replaced by something new (see “Creative Destruction”). Examples include the replacement of analog photography by digital imaging, of terrestrial by mobile telephony, or of manual labor by machines.

Sustainability Concept to determine time horizons for thoughts, decisions and actions.

Syntegration High-performance social methodology which helps to master complex challenges and problems by simultaneously leveraging the knowledge of a large number of people. The procedure comprises a self-coordinating cybernetic communication proves and the synchronous application of cyber-tools.

Terms Refers to the usual differentiation by short-, mid- and long-term. Defining management dimensions in this way, however, is misleading and thus extremely risky. Instead, the correct distinction is by “operative” vs. “strategic”: this is the only way to arrive at the right timing, never the other way round. After all, there are long-term decisions that are largely operative and there are short-term decisions that have an enormous strategic impact.

Time Constants and Dead Time Key terms within the Malik-Gälweiler Navigation System. They refer to the time elapsing between the point when the need for action is first identified and the point when strategic measures become effective, specifically generating new profit potential.

Part I:

Strategy for the Great Transformation21

“And you all know, security.Is mortals’ chiefest enemy.”

William Shakespeare (from “Macbeth”)

Part I will deal with the Why referring to precisely the strategic management I present in this book.

Parts II through V will describe the What and Whereby.

Part VI will deal with the How.

Chapter 1What Strategy Looks Like When the Future is Unknown

Strategy means doing the right thing when we do not know what the future will bring but have to act nevertheless. In this context, “doing nothing” is considered one of numerous conceivable actions..

Strategy means, even before you start working on something, acting in such a way that you will be successful in the long run.

Strategy is not about future decisions but about the future effects of today’s decisions, which also include non-decisions.

*

The first sentence reflects my own position. The second is by Aloys Gälweiler, the third by Peter F. Drucker. Each of these three sentences describes, in its very own way, the universal core of strategy that is and has always been valid for any age and time, irrespective of whether or not decision makers were aware of it, which made them build the wrong or the right strategies.

Strategy is dealing with an irremediable lack of knowledge. If we knew everything we needed to know to take far-reaching decisions we would not need a strategy but ordinary planning by deriving conclusions from existing data and information. The fact of the matter is, however, that we can never know everything we need to know because as executives we have to work and manage in the hypercomplexity of globally interconnected large-scale systems and in the dynamics of ever-accelerating change. We also face a constant lack of information and knowledge, as these systems are inscrutable by nature and will often change faster than we can make decisions.

As we will see in the next section, these three “definitions” of strategy are of particular, historically perhaps unprecedented importance for the Great

Transformation21, as the ongoing profound changes are creating a New World with many unknown variables.

All three positions do, however, not presume that we do not or cannot know anything about the future. Often, we could know far more than we would imagine, but to achieve that we have to let go of obsolete approaches and ways of thinking and focus on new methods, such as those I present in this book.

Managers often do not even know what and how much knowledge exists in the company because it is distributed across the organization and they do not know how to mobilize it. This is why critical knowledge is often dormant, again mainly due to unsuitable methods for which I suggest new alternatives here.

More often still, managers believe they know things they cannot really know, such as whether the crisis is really over. This creates a delusive sense of security and causes them to hold on to the old systems.

The most dangerous part of not knowing, however, is that we often do not know what exactly we need to know in order to design the right strategy. That was one of the main causes of the economic crisis, because strategies were based on information that was completely useless for strategic decisions and even misleading—to wit, on operational rather than strategic data. The solutions I present in this book also address this particular situation.

Gälweiler’s, Drucker’s, and my own positions are solutions for the above-mentioned cases of non-knowledge and for eliminating serious associated errors. These errors, some of which are systematically disseminated as false doctrines, are poisoning both the theory and practice of strategy; they are also the reason why we see corporate failures happen over and over again.

If these errors had been known the debacle of the financial industry would probably not have happened, as it was largely caused by such errors—which in the financial sector were committed with particular skill and perfection. It is therefore simply wrong when people say, in grave voices and with a knowing air, that it was impossible to foresee the crisis. Its seeds had long been sown in the strategies of numerous companies, including most financial institutions and regulators. Like them, many other influential and thought-leading organizations, such as rating agencies, consultancies, media firms and business schools, were set on a path of self-destruction.

What they celebrated as roaring successes for years—sometimes until just a few days before their demise—had actually been the “writing on the wall.” Even the timing had been relatively easy to determine, albeit only with tools not affected by these errors. The demise of the U.S. automotive industry is one case in point: the fact it was caused by the wrong strategies was not revealed with hindsight—it had started to become apparent as early as in the mid-1970s.

On the other hand, there are numerous examples of companies where these errors were not committed and which have been managed excellently for decades and more: Nestlé since the early 1980s, VW since the early 1990s, and Microsoft since it began partnering with IBM. BMW and Warren Buffett’s Berkshire Hathaway Group are further examples. Many family businesses—entrepreneurially led companies (ELC) as I call them—largely avoided the glaring mistakes that led to the world economic crisis, because they were not under pressure from the financial markets. Still, even ELCs will need new systems for navigation, information and control in order to cope with the challenges of the Great Transformation.

My own position eliminates, besides other misconceptions, the error of claiming to have knowledge where it is clearly lacking. Strategy therefore has to deal with constitutive non-knowledge, which—as mentioned before—results from the complexity and dynamic interconnectedness of todays’s systems within which our actions take place. Bringing constitutive non-knowledge into the equation opens entirely new dimensions of quality in strategy design, and permits elegant solutions where conventional strategic thinking fails.

Gälweiler’s position puts an end to the kind of errors that result from incorrect data, as well as to the entirely unnecessary and artificial limitations resulting from the setting of time horizons (short, medium, and long-term) which only obscures people’s view of the open time horizon we call the future. By using a new navigation method, this position permits an almost magically effective solution for dealing with complex challenges, a solution that lets us think from the end to the beginning, not vice versa.

Drucker’s position puts an end to the false belief that the future is pre-destined by fate and that we just need to predict it to know what will happen. His position—and this particular aspect is one I have often discussed with him—includes the extraordinarily hopeful thought that we can actively shape the future, rather than having to endure it passively. The resulting ethical mission for the top leadership elite is to go ahead and do just that—for they, and only they, have the necessary means and the power; in addition, they also have highly effective methods available to them today which are described in this book.

Here, I integrate these solutions with further elements to form a new approach to strategic corporate management, pointing out what you need to know in order to search for the right knowledge even under the most complex conditions, and to design and implement strategies that meet the following requirements: right, precise, fast, adaptable, and implementable with real-time control.

Before we get to that point, however, let us take a closer look at the Great Transformation and its drivers.

Chapter 2The Great Transformation21

Both the word of business and society as a whole are going through one of the most fundamental transformations that ever occurred in history. This transformation can best be pictured as a transition from an Old World to a New World. What looks like an economic crisis on the surface are actually the birth pangs of this New World, in which everything will be different from the way it was before.

When in my 1997 book on corporate governance I chose the name “Great Transformation” for the fundamental change that was already beginning to show, it was plain to see that most organizations of society would face radical changes and those that would master it would fundamentally realign their management systems and the way they basically functioned. All management system components, such as strategy, structure, processes, culture, managers’ competencies, policies and missions, as well as navigation, decision-making and problem-solving processes and communication systems would have to be adapted and, for the most part, changed to an extent both radical and revolutionary. This development has been in full swing ever since, and it is accelerating under the influence of an increasingly rapid succession of innovations in almost every relevant field.

This transformation process is far from being over. In just a few years’ time, many of today’s Global Fortune 500 companies will no longer exist, at least not in their present form. For instance, the U.S. Fortune 500 included eleven homebuilding companies in 2007—none of them is on the list today. Almost all of the corporate “Masters of the Financial Universe”, including the most noble ones, have vanished over night. Others will follow and new ones will arise—but they will be very different. Microsoft will have to change dramatically just to keep its global position; the pharmaceutical industry is currently going through its greatest restructuring phase ever.

These are just a few examples, and hardly an industry will be spared. Transformation challenges will be even greater for the public sector. Healthcare and education, public transportation, energy, the trade unions, public administration and governments—they all will not be able to survive with their current structures, processes and decision-making routines. Last but not least, our democratic institutions will face the most profound transformation of their existence.

This transition from the 20th to the 21st century is comparable to the replacement of the agricultural by the industrial society, or of the feudal system by the rule of law and democracy. But judging from the changes we have seen so far, the Transformation21 will be even larger-scale and more profound than any previous transformation of society. Some of the most important differences compared to previous transformations are the unprecedented global scale, the unprecedented degree of global systemic interconnectedness, and the unprecedented pace of change. The superlatives used so far, such as mega-change, do not suffice to capture the new dimensions of change.

Historically, transformations of this kind have occurred every 200 to 300 years. One of them happened in the 13th century, marked by the beginning of the Gothic period, the birth of the modern city, the foundation of the first universities as centers of intellectual life, and the formation of the guilds as the dominant social structure.

Another, similarly profound transformation occurred between 1455 and 1517, starting with the invention of printing and then shaped by the Reformation. Milestones of the transformation process included the Re-naissance, the discovery of America, the development of the sciences, the revival of medicine science, and the spread of Arab numerals.

The most recent transformation of this order of magnitude began in the mid-18th century. Key events included the Constitution of the United States, the development of the steam engine by James Watt, signaling the beginning of the age of industrialization, as well as the French Revolution and the Napoleonic Wars. Besides altering the political structure of Europe, this transformation also gave rise to modern universities, political parties and their ideologies, and a completely new structure of society in Europe.

The common denominator of these transformational periods is that each time, society and indeed the world changed radically within a period of about 50 years—so radically even that later generations would literally be unable to imagine what their parents’ or grandparents’ world had been like.

As a result of the current transformation of society, we will see fundamental changes in almost everything that we do, and also in how we do it and why we do it. In some way, even who we are will change. We will produce, consume, transport, distribute, and finance in new ways. We will also change the way we communicate, teach and learn, and almost any other human activity. The scientific insights and technological innovations for a new era are already there, and some of them have been used long enough for us to see their transformative power: the internet and the Smartphone are already changing people’s lives, the way they work, consume, and communicate, and creating new values and motivations. Still there are many more new developments coming up, and they will increasingly—and more and more radpiyl—take hold.

To cope with such changes and also to drive and shape them, we need equally profound changes in management systems, organizational structures and strategies, as well as in our thinking. In sophisticated knowledge companies, the effects of the New World are already starting to show. One of them is the way we deal with knowledge as a new resource, a tool and a product, as well as the specifics of knowledge workers and knowledge work, and the new ways in which knowledge organizations function.

The Old World Ends as a New World Is Born

For all the above reasons, what is currently happening “out there” is much more than an ordinary financial and economic crisis, by far exceeding what the world can simply “handle” to then return to its previous state.

To this date, changes have already progressed to a point where turning back would be neither possible nor desirable. Just as a caterpillar in a quite dramatic metamorphosis turns into a butterfly, for which everything is different from what it used to be before, only very few things will be the same in the New World as they were in the Old World. For instance, the caterpillar is subject to the laws of geodynamics whereas the butterfly has to persist in the world of aerodynamics, which is quite a difference. To do that, it needs a different system of functions compared to the caterpillar: different sensory capabilities, different neuronal circuits, and a different biological navigation system. And while the laws of geodynamics have not ceased to apply to the butterfly, their relevance has dramatically changed.

Correspondingly, the Old World was governed mainly by the laws of money and economics, whereas the New World will be governed by the laws of information, knowledge, insight, complexity, and the dynamics of strongly interlinked systems.

It does not take any forecasts to realize this. It is visible from various new elements which have been making their way into the global societies ever since Soviet communism collapsed, if not before, and which have been changing the functional rules of society at an increasing pace. The collapse of communism was triggered, driven and supported by new realities that were coming into effect at the time. Of course it is also true that the economic system as such had failed, but the cybernetic forces of control and communication had a much stronger impact. Knowledge beats money, and information beats power—as I also wrote in my book Corporate Policy and Governance.

This takes us straight into the heart of the New World. One of its most outstanding features will be its proliferating, exponentially increasing complexity, which will accompany us throughout this book.

Megachange in Megasystems

I will begin by grouping the key elements of the Great Transformation around five complex drivers: The first is demography, the second is knowl-edge and technology, the third is ecology, the fourth is the all-contaminating greatest debt of all times, as a key factor of economics; the fifth factor results from the interaction of these four major areas: it is complexity.

These five factors reinforce and drive each other, creating more and more complexity and confronting an increasing number of organizations with ever greater surprises. Incidents and disturbances are becoming the new norm. Among many other areas this will happen in politics, which in an increasing number of countries is turning into a problem rather than a solution, due to its proliferating complexity and insistence on outdated methods. With the new methods now available this would instantly change.

These drivers involve enormous risks, above all the economic risk of bringing on one of the greatest deflations ever, with an almost total collapse of asset values due to the global debt mountain. That is why I am emphasizing this one aspect of economic life, for it is the crucial economic fact. At the same time, these drivers entail the knowledge and the power to mitigate and master this crisis and create a new society with a new and functional social order.

An essential part of the new solutions is contributed by wholistic and modular management systems, such as those I have modeled after most sophisticated steering and control systems we find in nature, also incorporating nature’s laws of functioning. One reason that solutions have to be sought here is that conventional management thinking increasingly fails in the rapidly changing conditions of the New World. The new management systems are fundamentally different from conventional ones, almost to the extent that man’s brain and nervous system differ from the simple neuronal circuits of lower organisms.

The Current Crisis as the New World’s Birth Pangs