This Is Beyond Budgeting

Chapter 1Initial Reflections

The Innovation Paradox

Everybody loves innovation. Organizations want to be at the leading edge, always ahead. Everybody is encouraged to think outside the box (which can be hard if you are stuck in one…). The innovation enthusiasm is, however, very technology oriented on products, services, and customer offerings. Technology innovation is a crowded place because everybody is into it.

But the love has its limits. When we move to management innovation, exploring new ways of leading and managing, the enthusiasm seems to fade. “Losing control? Are you crazy!” Management innovation is therefore not yet a crowded place because it seems scary.

Few realize what great news this is for brave companies that dare to explore and embrace also this kind of innovation. There is just as much competitive advantage to be gained from management innovation as there is from technology innovation. Handelsbanken and many others are crystal clear about their source of competitive advantage. They find it in the way they lead and manage, not in what they produce, sell, or provide.

The Illusion of Control

While losing control is one of the biggest fears in management, having control is one of the biggest illusions.

When I ask executives, managers, finance people, and others to be more concise about their fear of losing control, many go quiet after having mentioned cost control. They struggle with defining what they are so afraid of losing.

Oxford Dictionary defines control ...