It’s good to talk

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Woman whispers to the girlfriend secrets

Dr Stefanie Reissner, a lecturer in organisational studies from Newcastle University Business School, has revealed that what is widely considered gossip in the workplace can actually help boost work performance.

My research, funded by the Economic and Social Research Council (ESRC), found that a company is a community that is maintained by sharing personal stories, which I call peer storytelling. Organisations that use peer storytelling well, establish constructive working relationships that are vital for effective operations, leading to improved business outcomes.

From childhood, individuals are conditioned to respond to and understand problems and issues, through storytelling. This translates into the world of work.

The research shows that sharing personal stories, from the funny to the emotional, can allow individuals to connect with others at work. Such a ‘connection’ enables them to understand colleagues and their actions in the workplace. This leads to improved judgement about behaviour, with benefits such as employees feeling more comfortable challenging one another. The result is more robust decision making and, arguably, better work performance.

Informal work conversations often get a bad press because they allegedly distract from the task at hand. But I ask: does being professional mean to be authoritative and impersonal on all occasions? My study shows that peer storytelling can alleviate pressure at work. If people are more at ease at work, they can be more focussed and productive in their daily routines.

I would encourage firms to appreciate the importance of peer storytelling as employees can convey everything from what makes them ‘tick’ to their ethics at work. In fact, far from distracting, peer storytelling can be good for an organisation.

This is pertinent nowadays when we are seeing rises in new business models like ‘hot-desking’ and limited personal interaction with colleagues and managers. Appreciating the human side of an organisation is vital in building a cohesive workforce in today’s network economy.

But, despite the potential benefits of peer storytelling, there can be negative effects on individuals and the organization. For example, the communication grapevine – an informal network by which unofficial information is transmitted within a place of work – can be harmful when rumour or inaccurate detail leads to misunderstanding and destroys relationships, trust and reputation.

I hope that the findings from this research can challenge the way employers think about how they build staff relationships and HR policies to foster meaningful interaction in the workplace.

The findings come from data collected from interviews with 75 individuals, between 2010 and 2012, and are now available in print. The book Storytelling in Management Practice, authored by Stefanie Reissner and Victoria Pagan, explores how managers use storytelling in practice, as well as its functions at different levels within an organisation.

Shifting perspectives on management

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Professor John Wilson, the Director of Newcastle University Business School (UK), introduces a blog which will offer new perspectives on topical issues in management, economics, and innovation.

What does the term management mean to you?

We live in a world of uncertainty and with this we have witnessed some huge failures of management, namely, failure of those in charge to make sense of a business issue and make the right decision.

Management is a term that has become imbued with tales of disaster, from Enron and the current financial recession to the BP Gulf oil spill of 2010.

In many scenarios top management have set targets – often financial – related to sales and returns to shareholders; meaning that the focus of the organisation has become the achievement of these targets at the expense of customer service and, in extreme cases, legality.

Here, at Newcastle University Business School, we want to make management a career of choice for people who want to make a difference. Our mission is to build excellence in our teaching while providing new, global business perspectives that contribute to the responsible and ethical shaping of society.

So how do we start to solve this issue and make sure our future leaders can manage safely, efficiently and sustainably; not focused on the bottom line, but on the holistic picture? How can we start to shift this current perspective on management?

Quite simply, we must go back to the basics: the education of management practice and how we teach this craft.

At school and university there is a risk that management (business studies) is seen as either a second-rate subject or studied primarily as a route to employment, rather than having a passion for the subject.

Here, at Newcastle University Business School, we want to inject it with a new perspective: to give it a true meaning that has been lost and overwritten during recent crises.

The true meaning of management is centered upon some key principles:

• responsibility – changing the world for the better through ethical supervision;
• bravery – employees standing up to forces driving them to do the wrong thing;
• innovation – constantly seeking and adopting improvements to products, services and ways of working;
• collaboration – enabling individuals from different backgrounds, disciplines and cultures to work together effectively to create value and to develop their effectiveness; and
• being ambidextrous – exploring and innovating to create the ‘business for tomorrow’ and at the same time making sure that the ‘business of today’ operates effectively and continues to develop.

Good management practice is vital for new enterprises, growing successful organisations, tackling complex issues including societal challenges, research commercialisation and the successful development and operation of the public sector and not-for-profit and social enterprises.

The Business School draws on its research strengths, learning community and business engagement to engage students in active, learning activities that help develop higher level managerial competences.

We are working hard to ensure that management graduates are ready to share their knowledge with colleagues, teams and organisations, in a bid to develop their ability to make a difference, and start to develop a new perspective on management.

Professor John Wilson, Director of Newcastle University Business School.

Prince Charles calls for pensions industry ‘fit for 21st century’

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By Anna Tilba, Newcastle University Business School

Speaking to a conference of National Association of Pension Funds, Prince Charles voiced his concerns over whether Britain’s’ pension system is built to cope with its ageing population. He emphasised that it is pension funds’ duty to manage environmental, social and economic risks and to change the culture of ‘quarterly capitalism,’ which is unfit for purpose. Prince Charles left it up to pension funds to ‘help shape a system designed for the 21st century and not 19th century’.

Having spent over seven years researching pension fund governance and investment, I would say that yes, change is needed but it is unrealistic that this change will happen, due to issues around pension fund liabilities, complexity of pension fund investment, demographic changes and the current economic climate.
‘Quarterly capitalism’ whereby businesses pursue short term aims for short term gains at the end of each financial quarter, is the sign of our challenging economic times.

Firstly, there are issues around how trustees interpret their duty. The UK legal trust tradition, which gives pension fund trustees the power and the fiduciary duty to act in the best interests of pension fund members, means that trustees -on the most part- interpret that duty as acting in the best financial interests. My recent research into UK pension fund investment practices suggests that trustees’ interpretation of their fiduciary duty of care is a core guiding principal, which informs pension fund investment strategies and actually discourages share-owner and stewardship activities.

Increasing complexity with pension fund investment chain means that in practice, pension funds are far removed from the corporations in which they hold shares. Many delegate all to do with pension fund investments to financial intermediaries who themselves are focused on share trading, rather than responsible shared ownership. The complexity of pension fund investment and an increasing regulatory burden also means that trustees are too busy dealing with pension fund governance and compliance, rather than with monitoring investee corporations and accounting for environmental, social and governance risks.

Furthermore, pension funds are currently operating in an environment characterised by economic recession and unstable, and complex, financial markets. Sadly, pension fund finances are now suffering a double financial blow: one from falls in stock markets and another dealt by the economic recession, impacting on cash flows and pension contributions of the sponsoring companies and local authority councils.

According to the latest figures, pension fund funding deteriorated significantly between March 2011 and March 2012 – the funding ratio (assets divided by liabilities) also fell from 100 per cent to 83 per cent (The Purple Book, 2012), putting more pressure on schemes to look for short-term investment returns to improve funding.

Pension funds are also operating in a world of increased human longevity and progressing pension fund maturity. Scientific data shows that life expectancy rose both in men and women: a 65-year-old man retiring today will, on average, live to 89. As a result of increased life expectancy, pension fund liabilities have soared to £1.702.6 billion with pensions deficits rising to £677.3 billion in 2012, from £470.7 billion a year earlier (The Purple Book, 2012).

Pension fund deficits have created a need for pension funds to match assets with liabilities, the so-called Liability Driven Investment (LDI) is putting more pressure on pension funds to rely on the market, volatile as it may be, to address the funding problem. Pension funds are forced to seek more short-term investment solutions, capable of ensuring the continuous flow of investment income into the fund and secure the payment of pensions.

If we are to start tackling this pension issue, we need to account firstly for the complexity associated with current financial markets. Secondly, we need to focus more attention to the responsibilities and accountability of financial intermediaries such as investment consultants advising the trustees and the investment fund managers who manage pension fund assets on their behalf.

With these two actions, we could make some steps towards the much needed change Prince Charles has called for.

Kittens are Evil – what happened in Wales?

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In the world of public policy, saying that outcomes are bad is like saying kittens are evil. It’s heresy.*

I’ll grant you, it’s not ‘hang on a minute, the earth goes round the sun’ levels of heresy. Nor have I nailed pieces of parchment to the doors of Downing Street (although, there’s an idea…). All I’ve done is to say that “outcomes” can’t be used as a way to effectively manage the performance of people who deliver social policy interventions. It doesn’t work. And, worse, it forces good people to lie about what they do.

There is emerging evidence in the media (including the Guardian, Daily Record, Radio 5 and File on 4) that outcome based approaches (OBAs) are subject to organisations ‘gaming’ the system. The reports suggest that service providers (from all sectors) are falsifying data in a number of ways (including the falsification of signatures on training registers and encouraging the unemployed to become self-employed thereby removing them from the unemployed statistics).

 The organisations involved are clearly working under the impression that the benefits of meeting the specified ‘outcomes’ (and therefore getting paid) outweigh the risks of getting caught. This behaviour is so widespread as to suggest that it is systemic and therefore endemic in the ways in which public services are being contracted and delivered.

I’ve been talking about the findings of my research into Outcomes-Based Performance Management at ‘Kittens are Evil’ conferences, which we started in Newcastle upon Tyne. We started in Manchester, where we focussed on Payment by Results. Most recently, we went to Powys, in Wales, where we focussed on the Results-Based Accountability™ systems adopted by the Welsh administration.

We began by looking at the problems with the underlying theory of Outcomes-Based Performance Management. Firstly,  that “outcomes” aren’t actually measuring impact in people’s lives – they’re not outcomes at all. And secondly, that outcomes aren’t created by organisations or programmes, they’re the emergent properties of complex systems, which means you can’t hold people, or organisations or programmes accountable for ‘delivering’ them – you’re asking people to be accountable for things they can’t control.

We then looked at all the evidence of what happens when people try to implement this flawed theory. Outcomes-Based Performance Management has been shown to distort organisational priorities, forcing managers to game the system in order to appear to be doing a good job. Further, it undermines frontline practice by making workers focus on achieving targets, rather than building relationships with people and helping them with the problems they actually have.

The Welsh context is very interesting, because there are lots of people inspired by the Vanguard approach who are doing things differently. Rick Wilson, Chief Executive of  the Community Lives Consortium described how they’ve reworked their service to focus on the genuine needs of adults with disabilities, by abandoning the paperwork associated with personal planning and simply capturing people’s stories during their day to day activities. They’ve made a better, cheaper service by doing so.

North Wales Police vividly described how a target-culture had prevented them from doing a good job, and how they’ve re-organised to put expertise and the use of professional judgement back on the frontline.

The Supporting People Team at Powys County Council presented data to show how their relentless focus on helping people to get back on an even keel is reducing demand on their own service and on other public services. 

 Monmouthshire Social Care and Health Services showed what was possible when you abandon the nonsense of tick-box outcomes, and genuinely focus on the needs of the people who present to your service.

The clear picture that emerged from all the afternoon’s case studies was that in order to genuinely create outcomes, you need to abandon Outcome-Based Performance Management, inspire frontline professionals with  an authentic  purpose, then support and trust them to use their judgement.

Measure the impact you make, but use it to learn, not to make yourself accountable to others.

Accountability is a myth. It’s a comforting lie used by leaders to reassure themselves that they are making a difference. This is the paradox of Outcomes-Based Performance Management. The more you try and make people accountable for delivering a particular set of results, the worse results they will actually deliver for people on the ground. (Although, you’ll never know that as a leader, because all the data will be telling you the story you want to hear).

The truth about kittens and their evil ways spreads.

For more information about the problems with Outcomes-Based Performance Management, and Payment by Results in particular, visit www.saynottopbr.net 

The next Kittens are Evil events are in Fareham on 30 September and London on 28 October. More information can be found on www.saynotopbr.net

My paper on Outcomes-Based Performance Management can be accessed here:

http://www.tandfonline.com/doi/abs/10.1080/09540962.2013.785707?journalCode=rpmm20

It has been downloaded over 1,000 times, and is the most downloaded in the journal’s history.

By Toby Lowe, Visiting Fellow of KITE.

Twitter: @tobyjlowe

*And the truth is, it’s not that outcomes are bad – how could helping someone achieve something positive in their lives be bad? It’s when “outcomes” are used as a performance management tool – like in Payment by Results, or Results Based Accountability ™ – that the problems arise. 

 

 

Think family

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It would seem that even the big television networks are creating programmes around the concept of ‘the family’.   From The Simpsons, Shameless, Rome, to the Tudors some very popular series have been made.  But why are they getting such great ratings?

Perhaps it’s because everyone can relate to the idea of a family.  But are families the bedrock of society that politicians believe?

One of my research themes that I work on with colleagues – James Cornford and Susan Baines – revolves around the family, and in particular how the government uses information system to ‘think’ family.

As we all know from our own personal lives: the idea of a ‘family’ – never mind the reality – can be very complicated.

Historically, under previous administration public bodies were asked to ‘Think Family’.

This has led to a number of government programmes that have encouraged services to integrate their facilities around families in order to co-ordinate support and intervention. This has led to a range of interests attempting to make sense of what to do about families.

Our research has shown that only when the government starts to grapple with the complexities of the ‘family’ will we really make progress with all sorts of families, including those who need the most support from our society. 

However, this is not a jigsaw where the problem has a boundary and is solved by integrating pieces together.

Different bits of the state see different versions of the family – and different things entirely for one department a jigsaw for another a crossword puzzle.

For instance: schools think family in terms of parenting; social services in terms of potential risk; child support agency in terms of fatherhood; and parts of the NHS in terms of genetics, the police in terms of crime and so on.

Rather like our own families it is the stories (often supported by artefacts such as family albums) and the changes that happen that potentially brings these strands together.

So when we come back to examining what the government is doing with its troubled family agenda, we might ask the questions: what interventions are being delivered, using which version of the family, to which of the family members benefit, and with what accounts?

It is clear that rather than families being the static structures we think about in terms the way a family trees represents them, they are lived projects (rather similar to real trees and their ecologies) which evolve over time. 

So in terms of family policy and practice those thinking about families need to have a more elastic idea of what families are to help those working with them and the families themselves to cultivate the best conversations they can have.

If you have a chance, you can read our recent research paper on the topic by clicking here

Dr Rob Wilson
Director of the KITE Research Centre and Senior Lecturer, Newcastle University Business School

We love TED(x)

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If there’s one thing better than a free lunch, surely it’s a free lunch sandwiched between talks from some of the world’s most inspiring people.

That was Wednesday in a nutshell, thanks to Digital Union and TEDx Gateshead, who streamed TED Global 2013’s sessions into the Northern Design Centre in Gateshead, with food kindly provided by lunch sponsors Ward Hadaway.

The sheer depth and diversity of this world-famous conference makes it impossible to choose ‘favourite’ speakers as such, but we found ourselves really moved and amused by the ‘Listening to Nature’ segment.

Kicking things off was Bernie Krause, whose Wild Sanctuary project records soundscapes from natural habitats all over the world, giving us humans a fresh sensory perspective on the damage we are doing to many vulnerable species.

And we heard about bees and the massive role they play in our own, precariously balanced food chain. Marla Spivak brought to life the plight of this industrious and ecologically vital creature (of which there are over twenty-thousand species, by the way) and we were reminded of the global-headlining-grabbing research being carried out at Newcastle into the relationship between pesticides and bee pollination.

From there on, speakers and topics diverged and delved into wild animals’ sexual behaviour, Middle-Eastern politics, urbanization in Latin America, post-Chernobyl societies, and many, many other realms.

That’s the great thing about TED: regardless of your chosen career or hobbies, just one afternoon of talks broadens your frame of reference, connects issues you might never have thought about at once, and leaves you feeling that little bit more inclined to change the world for the better.

If you haven’t already, check out the videos from this year’s TED Global and if, like us, you want to take part but can’t make the main event, keep in touch with TEDx to find out when and where your next local screening is happening.

 

If you cannot build a business around it, it doesn’t matter

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A recent event held at Newcastle University Business School saw guest speaker, Todd Brinton, discuss needs-based innovation in the medical field.

Medical devices innovation that is patient-needs driven rather than being the result of a technology push, can be built into a sustainable business that benefits patients and makes money for the innovator.

How does one find real medical problems that need to be solved? Why do we call them needs?

Todd Brinton, MD, fellowship director of Stanford University’s Biodesign Program, cardiologist and bioengineer, presented a bootcamp and a master class in innovation to a mixed university and industry audience.

At Stanford University the Biodesign program teaches the needs-based innovation methodology to their fellows in a year-long program with the purpose of creating entrepreneurs – people with the skills needed to take inventions to market. In the 13 years of Biodesign, 29 companies have come out of the program, and over 100 fellows have graduated.

Teams aim to find a strategic focus, look for problems, and then turn those problems into more generalised needs.

Teams are key – they must include a partnership between people with clinical, scientific, engineering and business development skills; these teams are found to innovate the best.

The team must take a strategic focus on an area that it cares about, and then immerse themselves in the clinical field of interest.  Once they are there they need to observe; get dirty; get in to see actual clinical practise and take notice of frustrated people; use fresh eyes and ask naïve questions because there are many, many problems.

Each observed problem represents a need. Some of these needs affect many patients and, when this need, this opportunity, is thoroughly evidenced, the opportunity is ripe for innovation, invention and business development.

Written by Lucille Valentine

The best of both worlds

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One of the first lessons I learnt when I qualified as an accountant was how different studying the theory of auditing was, to walking into a client’s office and trying to work the auditing software.
It is such moments in your early career that you realise the shift between ‘learning’ and ‘doing’.

Tomorrow, the Business School, PwC (PwC) and awarding body ICAEW, will celebrate its ten year anniversary of the ‘Flying Start programme’, a business, accounting and finance degree: a course that has had a decade of experience in merging ‘the learning’ with ‘the doing’.

The course is a long-standing example of how fusing theory and practice benefit the student proficiency of a subject. There is no denying that good work experience only benefits future career prospects.

The importance of this to the Business School is paramount, but it also raises interesting questions about what employers expect of graduates in today’s competitive job market, and what we can do to meet these needs.

Delivered by a team of academics and PwC, the Flying Start programme is a four year degree that enables students to put classroom theory into commercial practice on placement, and relates practical experience back to studies.

The degree affords students with an insight to the world of work, providing them with a great opportunity to harness the practical skills needed, with their own knowledge-base gained from within a lecture theatre.

In my position as a degree programme director, I have spoken to many employers about what they want to see in a graduate: one who can ‘hit the ground running’, a good level of industry, with team work and communication skills.

Higher Education Institutions (HEIs) are charged with the brief to create students who are prepared for the demands of the workplace – something that the Business School has been dedicated to achieving, and meeting such needs through programmes like Flying Start.

HEIs are moving away from the ‘chalk and talk’ educational experience to far more innovative and practical ways to impart knowledge: it’s an exciting time for the Business School and we are looking forward to the next 10 years.

Dr Simon Parry, Degree Programme Director BA (Hons) Business, Accounting and Finance

Dr Fiona Whitehurst reflects on the importance of being ‘civic’

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Newcastle University aspires to be a world-class civic university delivering benefits to individuals, organisations and to society as a whole, so it was a delight for the Business School to host Professor John Goddard OBE, Emeritus Professor of Regional Development Studies and former Deputy Vice Chancellor of Newcastle University to speak about his recently published book The University and the City  co-authored with Paul Vallance.

John is a leading proponent of the civic university concept, arguing in a 2009 NESTA Provocation that all publicly funded universities in the UK have a civic duty to engage with wider society on the local, national and global scales, and to do so in a manner which links the social to the economic spheres.

John revealed three tensioned themes emerging from his research – passive local physical, social and economic impacts of universities (campus footprint, student purchasing power, employment generation) vis a vis their active engagement in the development of the city; economic vis a vis more holistic views of engagement with civil society and the ‘external’ civic role of the university vis a vis ‘internal’ processes within the university and state higher education policies that shape these external relations.

John’s distinguishing attributes of a ‘civic university’ are:

  1. It is actively engaged with the wider world as well as the local community of the place in which it is located.  This engagement is achieved through dialogue and collaborations with individuals, institutions and groups locally, nationally and globally.
  2. It takes a holistic approach to engagement, seeing it as institution wide activity and not confined to specific individuals or teams.
  3. It has a strong sense of place.  While it may operate on a national and international scale, it recognises the extent to which is location helps to form its unique identity as an institution.
  4. It has a sense of purpose – an understanding of not just what it is good at, but what it is good for.
  5. It is willing to invest in order to have impact beyond the academy.  This includes releasing financial resources to support certain projects or activities, or to ‘unlock’ external sources of funding.
  6. It is transparent and accountable to its stakeholders and the wider public.
  7. It uses innovative methodologies such as social media and team building in its engagement activities with the world at large.

Plenty of food for thought, especially for a Business School. What does a ‘civic’ business school look like and how well does Newcastle University Business School fit that description?

Those are questions for a later post, but as I was pondering them I came across an article in the Financial Times (15 April 2013) by Della Bradshaw on German Business Schools. She notes that while Germany is the fourth-largest economy in the world, the country has no world-renowned business schools or top-ranked MBA programmes. In the article Robert Wardrop, research fellow in sociology and finance at the Judge Business School, University of Cambridge, ascribes this to the stakeholder value model of German business, which is incompatible with the methodologies that drive most Business School rankings. The MBA rankings tend to have an emphasis on salary maximisation, the traditional US individualist justification for undertaking an MBA. So, another question, does the third of John Goddard’s tensioned themes – the external role of a civic institution vis a vis internal processes and state policies have an added dimension for Business Schools?

Do Business School rankings take sufficient regard of an institution’s ‘civic’ role? In a time of unprecedented societal challenges globally I would like to suggest they should.

Dr Fiona Whitehurst, Director of Accreditation

 

Failure of strategy

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The failure of strategy has led to an era of fiscal, institutional, and legitimacy crisis with major moral tensions.

Five years after the financial crisis hit, almost destroying the UK banking system, we continue to try to understand the factors that contributed to the disaster. This was a disaster that, as the world knows, overwhelmed the Royal Bank of Scotland and HBOS to the extent that UK taxpayers are still majority owners of these banks (HBOS having been taken over by Lloyds).

The UK public may well be puzzled as to how the disaster happened and who, apart from the publically scapegoated and dishonoured ‘Sir’ Fred Goodwin, is responsible for its occurrence. 

This month (April 2013) has seen the Parliamentary Commission on Banking Standards produce a report in a bid to continue to try and unravel what happened when private loss was made a public debt, and we slipped into a recession. 

The Commission has been set up to consider and report on:
• professional standards and culture of the UK banking sector, taking account of regulatory and competition investigations into the LIBOR rate-setting process
• lessons to be learned about corporate governance, transparency and conflicts of interest, and their implications for regulation and Government policy
The report on HBOS is refreshingly willing to name names, and allocate blame to the leaders of HBOS at the time of the crash, naming in particular Sir James Crosby, Andy Hornby, and Lord Stephenson.

The (formerly) highly paid senior bankers quoted in the report continue to claim that the crisis was a sort of unforeseeable natural disaster (‘tsunami’ is a term used on a number of occasions). This report and the written and oral testimony collected by The Commission provides invaluable evidence of individual, group, and institutional dysfunction.

In particular, the main issues that emerge from the report are (1) that HBOS was doomed irrespective of the financial crisis; (2) the bank’s ‘retail culture’ played a role in perverting the aims of the bank as a customer service organisation, (3) that the HBOS board lacked banking, rather than retail, experience, and was (4)  unwilling or unable to address issues of existential risk that were undermining the bank, even when brought to the board’s attention by a whistleblower.

The report raises questions for practising managers and for business school academics concerning how managers can manage large and complex organisations.

Hopefully this report will contribute to another lesson: how we teach future business leaders to sufficiently analyse corporate issues with responsibility and ethical practice. 

Dr Ron Kerr,  lecturer in Organisation Studies at Newcastle University Business School.