BSR - Vol.2 Iss.2 Symposium - Valencia.scozzese.

ISSN: 2280-3866
www.business-systems-review.org
Business Systems Review
Volume 2 Issue 2, 2013 Special Issue - Selected papers of the 1st B.S. Lab International Symposium
From management of complexity for better performances towards management of complexity for survival: relations and strategies of firms
Giancarlo Scozzese, Ph.D. Assistant Professor. University per Stranieri di Perugia. Department Of Comapred Cultures. Perugia, Italy. e-mail: giancarlo.scozzese@unistrapg.it. Corresponding authori Roberto Bruni, Ph.D. Research Fellow. University of Cassino Cassino. Department of Economics and Law. Cassino. Italy. e-mail: r.bruni@unicas.it Published online on April 1, 2013. DOI: 10.7350/BSR.V15.2013 URL: http://dx.medra.org/10.7350/BSR.V15.2013 ABSTRACT This work aims to highlight the main relational and strategic criticalities of firms which at the present time find themselves forced to deal with turbulent and chaotic markets and, in particular, with a change in consumption. There are no more quiet moments for firms that are constantly stressed by complex events and by critical organizational aspects, at all levels, in quickly changing markets and society. Instability has become a regularity because of the economic crisis, the weather, and political events in different nations. In this way, the firms suffer high variability and complexity in order to manage from day to day their relationships with all stakeholders and with each market. This paper is focused on complexity management in the daily activities of the firm underlining the extreme variability of the current environment and context. Keywords: Complexity, Global crisis, Management, Survival.
1. INTRODUCTION Kotler and Armstrong (2005) considered the main task of marketing strategy to be the identification of consumers future needs and, of course, to design and develop the products and the services necessary for their satisfaction; they held this to be true for B2C marketing as well as for B2B marketing. Evolution and the market turmoil make it increasingly harder to foresee future developments, and it often becomes difficult, if not almost impossible, to produce predictions and planning of activities, especially in the medium to long term. The literature is beginning to unanimously agree that we must predict the future, according to different strategies already prepared and planned (Kotler, 2009). Globalization has led to some price reductions, to increased product availability (often at poor quality), and, basically, for some
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Business Systems Review, ISSN: 2280-3866 Volume 2 Issue 2, 2013 Special Issue - Selected papers of the 1st B.S. Lab International Symposium
products, to a less critical approach on the part of the demand to the supply. Technological development has opened its borders, has facilitated the exchange of information and, therefore, enhanced innovation capability in many contexts (firms in general have increased the quality supply). Senge (1990) considers organizational learning as the ability of organizations to adapt themselves to the environment in a sustainable way; other authors have dealt with organizational learning and contributed to the advancement of research (Mintzberg & Quinn, 1996; Serrano & Fialho, 2005) into supporting the theories of chaos and turbulence, especially alongside organizational models that can be adapted to the turbulent reality. From this aspect, emerges the need for organizations to organize themselves within this turmoil and chaos (Kotler & Caslione, 2009) by learning to understand and manage both this environment, but also the enterprises themselves from the inside. Thus a need to control innovation in organizations arises, apart from control of a technology that releases knowledge and information, as do financial and market difficulties in general and opportunities resulting from changes. The theories and reflections of Normann and Ramirez (1993) stress the importance, especially for SMEs, of checking reports which are upstream and downstream to the product-process chain and the core business (value constellation), and of maintaining correct relations with the stakeholders of companies that are in any case related to the company and which, in the event of a crisis, may be directly affected by such difficulties because of their (direct or indirect) connected. Every decision of the firm is thus based on information and data both inside and outside the enterprise, and the information system of marketing can be understood as an integrated and interacting structure of people, equipment, and procedures aimed at collecting, analyzing, and classify information for those in charge of deciding market strategies (Kotler & Keller, 2007). In synthesis, firms in these years of global crisis, through innovative management, need to develop B2B and B2C cooperation, and internal knowledge. They also need to give value to intangible assets in order to gain competitive advantages.
2. THE ROLE OF COMPLEXITY IN GLOBAL CRISIS: CONTINUOUS CHANGE The present economic world scenario is affected by a significant and persistent turbulence that came to a peak in September 2008 with the bankruptcy of the large merchant bank Lehman Brothers. In these times of turbulence, the role of business, management, and strategies in facing this type of macroeconomic instability and critical situation represents the crux of the debate: it is useful to identify the elements that give new trends in managementthat lead the company towards survivalinterpreted according to the generic elements of the firms crisis and the specific features of the global crisis in the era of continuous change. Tension arises in companies due to the economic crisis and other complex situations. The fear of unemployment and the difficulty of forecasting the future of firms, especially of SMEs, generate difficulties and tensions. From a management and production point of view, tensions in the firm generate negative results that cannot be managed when the situation of economic-financial difficulties is both global and enduring. When the crisis is strictly internally related to companies, for limited periods of time, problems and difficulties can be more easily solved. The mistrust increases when the feeling of difficulty involves the private domain of people, markets, and the global economy in general. Such mistrust leads to a reduction in consumption and risky investments, and therefore to economic
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recession. The governance of firms, especially of SMEs, has had to consider in recent years that the shock generated by the current economic crisis is very strong, and has not only reduced the opportunities for business but has generated new models of consumption, production and management, especially in Europe. The global economic crisis represents a new set of rules both from the business (supply) and, the consumers (demand) side; it is the time to reset the organizational structures and processes in compliance to new performance indicators, new type of investments, growth perspective , firms internal and external relations. Based on past experiences, other researches and studies, firms stand in a situation of indeterminacyii (Golinelli, 2010); in this condition, firms in some way know all the elements required for generating new survival possibilities, but will only find a solution if they are ready to improve the knowledge level of the interaction between these elements, and only if they also are inclined to change. Companies that change are enlightened firms, who possess governance capable of leading such change that, in turn, comes from a consciousness of different approaches to management, to the relationship with markets and stockholders, and so on. When an internal crisis affects the firm for a short time, the necessity of change is not shared by human operative resources; yet when it goes on for a long time and, especially, involves several nations, the feeling of difficulty and fear involves the company at all levels, which sometimes stimulates change. The duty of leading the change, especially in complex periods and during crisis, belongs to the governance that leads the firm towards innovation and value creation, while also developing consonance and resonance.iii In this work, we intend by the term innovation to synthesize the cluster of strategic and managerial approaches by which governance begins to manage the continuous change and to lead the firm step by step through the complicated and unpredictable situations caused by turbulent markets. By means of an approach based on continuous change, a firm can avoid immobility and assume flexible and adaptive features, in order to manage uncertainty; in this sense, companies will be continuously encouraged to innovate, weakening the effects on them of the economic crisis. In continuously innovating, governance must consider the expectations and awaited values of stakeholders and shareholders, the activities and processes that must be improved in order to reach the scheduled goals even in the crisis period, and the consonance and resonance levels that can be developed with relevant systems and supra-systems Innovation is aimed at generating value through a continuous renewal that could be spread throughout all processes and, in general through the operative structure. The Italian situation with regards to innovation is positive, because the economic and productive systems are founded on SMEs a situation that gives a particular, positive approach to research and innovation that is very often the result of practice, experiments, and relations with Universities and research centers. This condition, as can be observed in some studies on the innovation of Italian firms (Foresti et al., 2007), risks representing the SME sector as one characterized by low levels of innovation, as the reference indicators are connected with the outgoings of R&D.iv Italy is thus a production system characterized by a dual situation (Malerba, 1993) of innovation development, where we find few large firms investing in R&D, while a significant number SMEs found their development and innovation projects on unformalized activities, on direct contact with research institutions, and on in-the-field tests. In any case, once all these limitations are considered, the Italian situation of innovation is in line with that of other developed countries. In this situation, it is worth knowing that the Italian productivity system and the process of creation
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and management of innovation both support the development of exports and the approach to international markets (Sterlacchini, 1999; Basile, 2001, Guelfa & Trenti, 2004). The economic and financial crisis of recent years has highlighted the weaknesses of long-term forecasts, showing in the meantime that the best solutions for recovery and new economic development include the financial strength of firms, cooperation, the development of intangible assets (brand value, business ethics and culture, attention to design and use of information systems), collaboration between public and private sectors to make specific strategic choices and eventually to support employment, or at least welfare, systems. From the literature on process management, two approaches to change emerge: one is the radical type and the other is the improvement type or incremental type. The former does not exclude the latter, and is not more efficient it; it is simply necessary to identify the correct moment in the life of the company to act with the right level of innovation. In the literature on Viable systems Approach (VSA), three forms of change are identifiable, involved at different levels of the firm: adaptation involves ameliorative actions with the aim of reducing the cost of structure use (with the structure remaining unchanged); transformation operates on the extended structure that remains unchanged but, in fact extracts from this a new specific structure. Structural transformation works on an extended, unchanged structure to allow the development of relations and contacts that can be activated with external systemic entities in the perspective of value creation and development. This kind of change-innovation takes place thanks to the flexibility of the extended structure. When governance wants to grow past the extended structure, and decides to rethink its business foundations, it can modify the business idea. In this way, the firm can identify new ways of doing business (Golinelli, 2002). Although these topics are already known, the significant consideration that we ought to remember is the role of time and organizational flexibility in the activity of the firm. Market turmoil and economic instability impose a high pace of planning, organization, adjustment, and strategic development. In this complex context, companies cannot lose time or weigh down their structure with rigid organizational levels, extremely standardized procedures, or complex decisional models: they must give value to trust feelings among the stakeholders and to optimal proxy levels, and they must access results, motivation, self-denial, and inspiration. The unpredictability of events has generated situations characterized by high uncertainty, and to be filled with courage, creativity with the value of intangible assets, instead of a high level of bureaucracy.v The concept described here is connected with several studies of companies having as their object strategy and organization that, over and over, have underlined the distance between the planning phase and the operative reality of implementation. Often within an organization we find differences between what is decided and what is practiced. Sometimes, such situations generate great difficulties within firms, and the management has the duty to reduce this gap. Yet, as a matter of fact, it cannot be completely removed, especially when organizations have to deal with internal (management, technical, relational) problems or with external disturbances (unforeseen variability of the market and situations affecting the company, unexpected obligations coming from the supra-systems). These topics, among others, have been approached by Mintzberg (1985) and by scholars of organizational behavior theories. At historic moments characterized by an high level of variability, such as the present juncture, it is important to plan company development by interpreting the maximum amount of information coming from the markets through a particular sensibility build on knowledge (know-why) and company experience.vi
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3. THE FEATURES OF THE CONSUMERS, AND FIRMS
CURRENT
GLOBAL
CRISIS:
MARKETS,
Behind the current global crisis is the widespread seeking of greater profit, the persistent action of large international banks that, by the distorted use of finance, have encouraged risky investments, often omitting information important to large and small investors. Financial institutions have supported the demand for complex financial products capable of generating high profits, but mainly based on intangible markets of risky investment products. It is clear this kind of global behavior has involved civil society at all levels, and has caused an economic, ethical, and moral problem that has destroyed a many jobs and generated tensions between people. Because of the magnitude of the crisis, the economic community, especially within the financial field, decided to define more rigid rules in order to avoid similar situations in the future.vii The concept of crisis generally associated only to negative meanings, but in the present situation, the economic conjunction has led to a global revolution in some sectors and in some aspects. The effects of this differ from one country to another, and call into question the strengthened models of consumption and business that are in some way leading also positive results.viii In terms of demand, if we analyze in a positive way the results of this phase of great consumption, we can highlight some interesting aspects of the transformation. In particular, given strong consumption, reductions in the supply of circulating cash, and above all the decrease in employment, we find a greater attention to economical measures, to saving, and to responsible consumption. On one hand, this situation generates a further arrest of the economy and a slowing of growth, due to the drop in mass purchasing and spending volume but, on the other hand, it develops new positive typologies of demand, attention to the environment, solidarity, recovery of the central moral values, and cooperation. In a situation characterized by market contraction, spending by consumers (and firms) tends to be naturally limited by wiser purchase planning; there is the tendency to evaluate a larger number of offers before making a purchase, and new purchase modalities are developed, privileging the exchange of information prior to the act of purchasing, and, above all, considering the aggregation among economic subjects (groups of supportive purchases, consumer cooperatives, associations, etc.). The literature, not only in economics, shows that humans tend to aggregate in order to solve difficult problems and to defend themselves from dangers. This is the principle which has contributed to the development of villages, cities and, in general, of organizations. In this difficult period, thanks also to the help of new technologies, new network models grow from the bottom and manifest themselves mainly through the sharing of information in all sectors and through co-creation of value.ix Regarding this, some authors affirm the relevance of mass participation as a new way of conceiving society, companies, and more generally, management problems: The new mass collaboration is changing how companies and societies harness knowledge and capability to innovate and create value. [..] Conventional wisdom says companies innovate, differentiate, and compete by doing certain things right: by having superior human capital; protecting their intellectual property fiercely; focusing on customers; etc. The new business world is rendering each of these principles insufficient, and in some cases, completely inappropriate. [..] The new art and science of wikinomics is based on four powerful new ideas: openness, peering, sharing and acting globally (Tapscott & Williams, 2008:20).
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The stimulus of sharing, opening, and of global action should lead companies to reconsider their management models, and should also lead to a change that is an element of complexity reduction, and that very often is considered in a positive way by organizations, as it entails as a guidex self-denial, new work models, new procedures, and also some risk. According to Farinet (1987) the crisis in firms also arises because of the incapacity of some who, when dealing with negative variations of the context, do not invest to find solutions or to propose innovative options, but propose again the same offer and the same management modality.
4. MANAGEMENT OF COMPLEXITY IN FIRMS The complexity of markets, economic trends, and financial difficulties can initiate the beginning of a crisis that can lead to a firms failure. A companys crisis can appear even when the market is growing and positive economic conditions prevail, but when economy is in recession all over the world and the economic crisis has already spread, management becomes more relevant. In this paper, we select a set of management macrofactors and, interfacing them with the corresponding macroeconomic elements that generate economic difficulties and global economic crisis, we propose actions and management models useful for managing complexity, in order to lead the firm toward survival. The Slatter model (1984)xi suggests a series of internal and external elements that are to be monitored in order to determine the probability or the status of a business crisis in a given period. Indications show some verifiable elements that have to be contextualized in the specific time periods. Among the internal factors of a company, we can find: Characteristics of the competition and the environment (factors related to the specific area in which the company operates); Characteristics of the firms management (management structure and internal reports); The firms organizational characteristics (flexible structure, hierarchy, relations within corporate functions). Among the external factors determining the crisis are: Macroeconomic factors external to the company; Sectorial factors external to the company (referring to the companys target market and especially to competitors, suppliers, etc.). 4.1 External factors determining crisis Regarding external factors that determine the crisis, there are an infinite number of variables that cannot be directly controlled by firms but can influence the choices of managers, especially within firms strongly connected and integrated with the global economy.xii The problems that occur in the network of a firm unable to manage the macroeconomic complexity move across the network, causing further difficulties. Macroeconomic or environmental factors are considered to be less manageable and controllable than companies, despite the fact that they are related to the economic or social context.xiii These are essentially elements of economic instability (table 1) capable of determining critical conditions for companies, enterprises, and entire industries. Their
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sudden occurrence can cause very significant changes in productive inputs, supply markets and new markets, which more specifically translate into changes in costs, availability of labor, and capital; variations in the innovation level required from the production system; sudden transformations of the exchange relations between goods and in the monetary system, and so on. Table 1. Elements of generic economic instability. Political instability, complex laws or deficient in promoting the enterprise development Bureaucracy and high fiscal taxation against limited services Reduced spread of specific professional skills over the different territories Reduced support of banks to enterprises investment projects Low level of incentive to research and innovation due to the lack of investment in research Weak financial markets Lack of infrastructure and related investments on infrastructure development projects Table 2. Global crisis: negative elements. Distorted financial markets Difficulties in the relationship between stakeholders and firms Rising unemployment Reduction of financial investments Liquidity crisis Social tensions Environmental issues
Table 3. Global crisis: positive elements. Responsible consumption and environmental awareness Transformations of political, social, and cultural variables New laws to guarantee investments New patterns of demand in Western countries and new demand in emerging countries
Economics generally considers the variation of some macro-variables to be essential, such as the interest rate, the capital cost, public spending and public debt, in order to explain complex dynamics. A sustained increase in the exchange rate, an uncontrolled growth in interest rates that penalizes investments, increases in the public spending or the net foreign debt, all combined with increases in tax burden, all represent macroeconomic phenomena that involve the creation of conditions for imports to develop against exports. A country where the wealth of its productive apparatus comes from its relationships within markets different from the original one inexorably assists its collapse, with all the consequences that arise from this and that have an impact on the national economy.
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Thus, when managers of a company plan their marketing strategies, they also need to take into account such environmental variables, in order to avoid choices capable of accelerating the mad race toward critical situations that could threaten the survival of the company. 4.2 Internal factors determining enterprise crisis and management elements generating complexity within the firm Several factors internal to firms can determine a crisis. These factors can be classified as management elements (table 4) and economic/financial factors (table 5). The economic or financial factors represent the result of strategic choices made through management elements and macroeconomic external influence; the management choices and the global crisis can be the cause that generates the negative effect present in the economic/financial factors. Without the presumption of completeness, we here propose a list of the main management elements and a list of economic/financial factors that may signal crisis situations.xiv Table 4. Management elements that lead to crisis in firms. Low levels of crisis acknowledgement Difficulty of strategic forecasting activities Low levels of knowledge management Extent of Strategic Change Middle and Long term routine management Loss of significant managerial resources Internal tensions Worsening of relationships with suppliers Worsening of the relationships with the financial system Lack of strategic capabilities
Table 5. Economic/financial factors that lead to crisis in firms. Loss of profitability Negative cash flows Loss of market share Reduced sales Increase in debts Reduced liquidity Loss of receivables Deterioration of the financial structure
In economic periods where markets are growing, some management choices capable of identifying positive or negative economic or financial results, can lead the company to developmentif the management strategies have a positive effector to simple stagnation, if management choices are unsuccessful. A favorable market situation naturally tends to protect firms from mistakes. In times of global crisisxv, traditional management or small corrections to the traditional management activities are insufficient to guarantee the survival and the development of the
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enterprises. The specific features of the present crisis require a new management team able to quickly interpret market changes, reorganize management methods, enhance the intangible assets of the enterprises, develop initiatives for the cooperation with companies and consumers, and develop financial strength. 5. CONCLUSIONS: MANAGEMENT OF COMPLEXITY TO SURVIVE When the prediction of markets become difficult (Greenspan, 2007), marketing actions and reactions influence the market actions and reactions, and vice versa. The company stands in contexts where it is difficult to predict something, and where managers must find new management modalities that may sometimes appear unconventional. The tendency, therefore, should not be to weather the crisis and to seek tactical solutions, but to predict different scenarios (Kotler & Caslione, 2009) by adapting the models and the development strategies to appropriate reference hypothesis. Each kind of business plan needs specific predictions, but in these turbulent years, we need to pay special attention to risk-sensitive foresight, interpreting risk as the probability of negative events for the company, coming mainly from external factors which are less and less controllable, such as the problems and difficulties of political economy, financial markets, and so on. A variation of some management variables should correspond to a global change in demand. Yet not all companies are willing to change. Nelson and Winter (1973), for example, argue that organizations agree to change their routine only if the expected profit falls below a minimum threshold established by the organization. Otherwise, they choose to remain steady with no change, even in a time of crisis. Frequently, in fact, we find companies that are not willing to invest in change, preferring instead to invest in routine management without risking any change. The global economic crisis involves companies that are facing complex situations and, by consequence, forms of change become indispensable in the management to generate a shock and a shift from the previous stage. The shock, and the reduction of market opportunities, compels companies to organize themselves in order to survive. Previously, we broke the global crisis down into negative components and positive components; both components generate imbalance in firms that, in order to survive, can be managed through management elements. Figure 1. Management elements for survival. Global Crisis (negative aspects)
Management elements for survival
The firm can survive
Global Crisis (positive aspects)
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The main elements of management that, by the characteristics of the global crisis, allow companies to survive in a complex environment are financial strength, cooperation, and promotion of intangible assetsxvi. Financial strength is crucial, because the global crisis began in the financial sector and has destabilized the rules and laws of finance, causing a liquidity crisis and problems in the relationships between banks, companies, and investors. Financial strength allows firms to support change, even in complex market situations. The loss of competitiveness in Italy, characterized by inflation, stagnation, and drops in per capita income, has been known for years, although protected from a domestic financial system less daring than those in European and international contexts. The backwardness of the financial market and the lack of innovative financial instruments in the Italian market guaranteed the maintenance of the sector and of the major banks that, until now, have prevented a real crisis, firmly absorbing current market and economy difficulties. A management that offers slow and careful growth of the firm in a step by step modality is necessary. Cooperation is an awkward issue, also discussed in the literature. In complex situations, cooperation means creating collaborative global networks and widening the firms boundaries, not only to obtain the intended benefits (commercial, manufacturing, etc.), but also to set up a new way of doing business in a direct and continuous cooperation between companies, consumers, and territories. The situation is hindered by rigid network links and exclusivity; companies in turbulent environments must be flexible, adaptable and open to change. The valuation of intangible assets is an extremely relevant theme in firms survival courses during the global crisis, characterized by their economic knowledge. In intangible assets, we can find the value of a brand, culture, and business ethics, as well as an efficient information system. Companies that do not develop their intangibles have lesser chances of overcoming the global crisis that is creating a new economic equilibrium of specialized and flexible companies capable of moving products and services to places of the world where work has a lower cost, even though they try to keep control in specific skills, in ethical behavior, and in respect for people and the environment. Attention to the environment is another factor that allows the development of a new firms approach to the markets. Unexpected and catastrophic weather events, climate change, and the global problem of pollution are all issues that by now affect many consumers; companies need to consider that in recent years, the sensitivity of consumers to environmental issues has increased, and more and more often, purchasing decisions are being made in line with this environmental sensitivity. On the relationship between companies, markets, superfluous consumption, and its reduction, Kotler (2011) says: Marketing has traditionally been about demand expansion, and this will remain the dominant pursuit; However, there are times and resources that will demand conservation and reduction. Since the arrival of the great global recession, consumers have been balancing their consumption by choosing products based on actual need, confronting and cooperating with other consumers. We need companies involved in the social sphere, easily recognizable, able to build in time a reputation that is in constant contact with consumers, but also with research centers and universities, using the most modern technologies with an attitude of innovation and constant change.
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REFERENCES Basile, R. (2001). Export behaviour of italian manufacturing firms over the ninties: the role of innovation. Research Policy, 30(8), 1185-1201. Di Bernardo, B., Rullani, E. (1990). Il management delle macchine. Bologna (Italy): Il Mulino. Foresti, G., Guelfa, F., Trenti, S. (2007). Strategie e performance: unanalisi econometrica. In Guelpa, F., Micelli, S. (Eds.). I distretti industriali del terzo millennio. Dalle economie di agglomerazione alle strategie dimpresa, pp. 147-180. Bologna (Italy): Il Mulino. Golinelli, G. M. (2005). Lapproccio sistemico-vitale al governo dellimpresa, vol. I, Limpresa sistema vitale. Padua (Italy): Cedam. Golinelli, G. M. (2010). Viable Systems Approach Governing Business Dynamics. Padua (Italy): Kluwer/CEDAM.. Greenspan, A. (2007). The age of turbulence. New York (USA): Penguin Press. Guatri, L. (1985). Turnaround: declino crisi e ritorno al valore. Milano: EGEA. Guelfa, F., Trenti, S. (2004). Strategie di impresa e performance nei distretti, verso un nuovo paradigma?. In Bracchi, G., Masciandro, D. (Eds.). La competitivit dellindustria bancaria, nono rapporto sul sistema finanziario italiano. Di Caro, Bancaria editrice. Hamel, G., Prahalad, C. K. (1993). Strategy as stretch and leverage. Harvard Business Review, 71(2), 75-84. Kotler, P. (2011). Reinventing Marketing to Manage the Environmental Imperative. Journal of Marketing, 75 (4), 132-135. Kotler, P., Armstrong, G. (2005). Principles of Marketing. 10th edition. Upper Saddle River, NJ: Pearson. Kotler, P., Caslione, J. A. (2009). Chaotics: The Business of Managing and Marketing in The Age of Turbulence. New York: Amacom Publishing. Kotler, P., Keller, K. L. (2007). Il marketing del nuovo millennio. Milan (Italy): Pearson. Kotter, J. P. (1996). Leading Change. Harvard Business Press Books. Maggioni, V. (2000). Apprendere dalle strategie relazionali delle imprese: modelli ed esperienze per le meta- organizzazioni. Sinergie, 52. Malerba, F. (1993). The national system of innovation: Italy. In Nelson, R. (Ed.). National Systems of Innovation: A Comparative Analysis. Oxford: Oxford University Press. Micelli, S. (Ed.) (2007). I distretti industriali del terzo millennio dalleconomie di agglomerazione alle strategie di impresa. Bologna (Italy): Il Mulino. Mintzberg, H. (1985). Of Strategies, Deliberate and Emergent. Strategic Management Journal, 6(3), 257-272. Mintzberg, H., Quinn, J. B. (1996). The strategy process. New York: Prentice Hall. Nelson, R. R., Winter, S. G. (1973). Toward an evolutionary theory of economic capabilities. American Economic Review, 63(2): 440-449.
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Nonaka, I., Takeuchi, H. (1995). The knowledge creating organization: how Japanese companies create the dynamics of innovation. New York: Oxford University Press. Normann, R., Ramrez, R. (1993). From Value Chain to Value Constellation: Designing Interactive Strategy. Harvard Business Review, 71(4), 65-77. Senge, P. M. (1990). The fifth discipline. The art and practice of the learning organization. New York: Doubleday. Serrano, F., Fialho, C. (2005). Gesto do Conhecimento. O novo paradigma das organizaes. Portugal: FCA Editora. Sifneos, P. E. (1967). Clinical Observations on Some Patients Suffering from a Variety of Psychosomatic Diseases. Acta Medicina Psychosomatica, 7, 1-10. Sterlacchini, A. (1999). Do innovative activities matter to small firms in non- R&D intensive industries? An application to export performance. Research Policy, Elsevier, 28(8), 819-832. Tapscott, D., Williams, A. D. (2008). Wikinomics. How Mass Collaboration Changes Everything. New York: Portfolio/Penguin. Toffler, A. (1980). The Third Wave: New York: Bantam Books. Volpato, G. (2010). Economia e gestione delle imprese. Fondamenti e applicazioni. Roma: Carocci editore.
Endnotes
i
To conform with Italian regulations on academic publishing, even though the article is the joint work of all the authors we attribute the contribution of each author as follows: sections 1, 2 and 3 may be attributed to Roberto Bruni and sections 4 and 5 to Giancarlo Scozzese.
ii
The concept of indeterminacy refers to a characteristic of a phenomenon linked to the ability of an observer to fully understand it as a whole (Golinelli, 2010).
iii
The concepts of consonance and resonance are two fundamental aspects of the Viable Systems Approach (VSA); the former refers to the degree of integration among structure their potential structural compatibility for exchange. It is the ability to relate to the outside world in order to bring about the exchange of resources. The latter concept, resonance, it is a criterion for assessment and selection by suprasystems, in order to endow government with instruments it can use to make necessary structural changes and international strategies. It is a latent variable which cannot be observed directly, but which can be measured through critical bearing and can influence variables (Golinelli, 2010).
iv
While large companies take note of their R&D costs, SMEs often do not. In SMEs, sometimes, expenses are not registered and investments are in field research.
v
On the cognitive view of the company system, see Nonaka I., Takeuchi H. (1995); on the relationship between knowledge collected by the firm and the complex of informative channels that encourage the acquisition of this knowledge, see Maggioni V. (2000); on distinctive competence, see Hamel G. and Prahalad (1993).
vi
According to Volpato (2010), culture is something that gives us information on the variety of the world and the singularity of our experience, and so it represents a source full of alternative ideas and possibility to be explored. Volpato G., 2010, introduzione allo studio della gestione di impresa.
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vii
In the 2010 meeting of the World Economic Forum in Davos, the French President Nicolas Sarkozy said, This not just a global financial crisis, it is a crisis of globalization [] there will be a much greater demand for justice, protection, regulation, and cooperation.
viii
Sifneos (1967) says about crisis that it could intensify or aggravate a difficult condition, that l eading toward better or toward worse.
ix x xi xii
Alvin Toffler first coined the term prosumer in his book The Third Wave (New York: Bantam Books, 1980). For further in-depth analysis on leadership and organizational issues, refer to the work of Kotter J.P. (1996). See Guatri (1985).
Companies organized in networks, innovative companies on highly volatile markets, companies heavily dependent on financial markets or companies that optimize the supply chain through the system of Supply Chain Management.
xiii
In the case of outsourcing there is often a dependency between companies, and the default of one company in the chain can weaken the entire network. The model of the search for higher levels of efficiency through lean practice has led some companies to overdependence on suppliers.
xiv
It is very difficult to develop a definitive list of causes that generate crisis in enterprises. This paper proposes an analysis of useful elements to determine management models that support the processes of managing the complexity generated by the global crisis.
xv
Characterized by liquidity crisis, distorted financial markets, rising unemployment, social tensions, environmental issues, new patterns of demand in Western countries, new demand in emerging countries, responsible consumption and environmental awareness, reduction of financial investments and new laws for investment protection.
xvi
See bibliography on the subject.
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ISSN: 2280-3866

Business Systems Review

3. THE FEATURES OF THE CONSUMERS, AND FIRMS

Management elements for survival

The firm can survive

Global Crisis (positive aspects)

See bibliography on the subject.

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