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20.02.06

Exploiting the power of analogy

This is Gary Hamel’s advise for mangement innovation to become successful. In the February issue of the Harvard Business Review, Hamel focuses in his article on the importance of mangement innovation. He argues ’Over the past 100 years, management innovation, more than any other kind of innovation, has allowed companies to cross new performance thresholds.’ Importantly, Hamel defines management innovation as ’a marked departure from traditional management principles, processes, and practices or a departure from customary organisational forms that significantly alters the way the work of management is performed.’

The above mentioned statement is one out of four elements, Hamel suggests to make management innovation a systematic process. Since many management problems arise from the difficulty in communicating abstract topics (vision, strategy, purpose, branding, knowledge management etc), building and exploiting the power of analogy can be a highly valuable approach. Hamel uses an example that I find especially interesting (also for other purposes, such as idea management or the innovation pipeline): bookies (bookmakers)
Create a market for judgement that harness the wisdom of a broad cross section of employees. An executive sponsor would set the initial odds for a project to achieve a particular rate of return within a specific time frame.

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