Crisis prevention is becoming more relevant

It goes without saying that I work according to recognized standards developed by the Institute of Public Auditors in Germany (IDW). In particular, my company valuations and my restructuring concepts comply with recognized standards.

As a management consultant working at the interface between science and business practice, the current state of scientific discussion is also evident in my work, just as I feed the findings from my project work back into the scientific discussion through publications and make them generally available. I aim to be methodologically sound and to make the available methods more practice-oriented.

Preventive, stability-promoting measures include, above all, mindful process optimization, planned backwards from the customer benefit, so that redundant and faulty performance is avoided. For agile coordination and adaptation at the process interfaces on site, the processes must be provided with stabilizing feedback loops. Solid links between processes is also important in order to achieve completely coordinated activity in the company.

It is very important that processes are not written solely for ISO 9001 auditing, but that they are actually lived and implemented. If defined processes are bypassed, they are obviously not good enough and should be improved. Deviants are not necessarily outlaws, but often sources for improvement possibilities.

In the case of highly standardized processes, it is even possible to have them executed directly via workflow applications. In such cases, the quality of the process definition is particularly important.

Nobody sees everything, nobody knows everything. These natural blinkers that we all wear can be largely compensated for by including all the competencies, views, interests and emotions relevant to a decision in the decision-making process. As a result, decisions are better prepared and turn out to be better balanced.

Our (business) world is dynamically complex. Mental models that reduce the existing complexity hide the complexity that is actually at work. They do not represent the world in the right way. Each of us forms such models in order to cope better with our (working) life. But we must be aware of the limitations of such mental models at all times. That is why I recommend a mindful approach to my clients, without blocking out alternative paths. In dynamic-complex environments, the most important asset is to have options for action (variety) in order to be able to react to changes.
Although the overall degree of complexity is to be taken as given, the composition of complexity can certainly be shaped in one’s own sense. In this way, an unnecessarily high number of variants can be reduced. This reduces the company’s internal value-destroying complexity; however, it also reduces the number of options that can be offered. The relationship between external and internal complexity must be balanced. An unwelcome competitor creates external complexity which, on the surface, you can hardly influence. If you acquire this competitor, you have repressed the complexity that emanates from this competitor. But it does not disappear; rather, it turns into internal complexity, because you now have to manage this acquired company.

The System Dynamics method developed by Jay Wright Forrester can be used to vividly model complex interrelationships. This method requires special software, such as Vensim, which can mathematically capture and process the multiple mutual interrelationships. Software like this can do what our brains cannot. Even during the modelling process, which should preferably be carried out in the company of a management team, the participants become aware of important insights into effective interrelationships that they can incorporate into their decisions in the future. It becomes interesting when scenarios are simulated with modelled realities, i. e. the implications of different decisions can be played out.