Strategy Needs Structure

Structure Needs Ontologies – Dynamic Ontologies Carry Meanings

Hannu Vanharanta

and Jussi Kantola

Industrial Management and Engineering, Tampere University of Technology, Pohjoisranta 11, Pori, Finland

Industrial Management, Vaasa University, Vaasa, Finland

Keywords: Strategy, Strategic Management, Fuzzy Logic, Applications, Decision Support Systems, Ontologies,

Methodology, Statements, Evaluations.

Abstract: In our long-term research we have created a new management and leadership methodology, which can be

used for strategic management purposes to manage change and to lead the company resources efficiently

and effectively towards the new future. Our research methods are based on management and leadership

ontologies, with which we can capture the current and future views of personnel for use in strategy making

and strategic management. The evidence we have obtained originates from our research with our ontology-

based research instruments and test runs with fuzzy logic based computer applications.

1 INTRODUCTION

People involved in strategic thinking, strategic

planning, strategy making and strategy

implementation try to predict, delineate and

influence the future state of their organization. The

work they do deals with the linkage between the

organization’s scenarios, visions, goals and

objectives and the organization’s current external

and internal world. A prerequisite for the success of

their strategy-making activities work is that all the

people involved and also other persons in the

organization arrive at a shared vision as the basis for

development and progress. Often though, the

process of strategic thinking and strategy making is

fraught with misunderstanding and conflict,

especially at the beginning. The participants may

lack a shared understanding of the future path of the

organization; they may not have a common view of

its operating environment or a shared appreciation of

the overlying world structure or underlying

constructs and concepts of their company

characteristics. If, combined with this, management

issues in general and the characteristics of the

organization in particular are cognitively perceived

in different ways by different participants, the

strategy-making process becomes even more

complex and problematic, especially its

implementation. This is true for any organization,

public or private. Faced with the aforementioned

problems, strategy makers continuously express the

need for comprehensive, reliable and commonly

assimilable data, information and knowledge, that

they can use to monitor, diagnose, analyse and

synthesise the current performance of their

organization and to estimate its future potential.

2 THE APPLIED STRUCTURE

We have now worked several years to develop

executive and decision support systems that will

enhance actual decision-making through human

visual perception as well as to meanings in texts as

well as meta-knowledge formation. These new

support systems are based on the ontological reality

of organizational constructs, concepts, variables and

indicators (cf. Kantola et al., 2010). They are also

based on the overall conceptual framework called

the Continuous Strategy (Vanharanta 1995).

The Continuous Strategy ontology is a construct

or framework for strategic planning processes. The

framework is derived from metaphorical insights

into “the Company”, an “organism” seen as part of

the living system. The Continuous Strategy ontology

is supported by a chain of construction metaphors:

the External World, the Business World, the

Company World, the Product World and the Buyer

World. These metaphors represent conceptual

models, and they are used to construct a coherent

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Vanharanta H. and Kantola J..

Strategy Needs Structure - Structure Needs Ontologies – Dynamic Ontologies Carry Meanings.

DOI: 10.5220/0004118902610264

In Proceedings of the International Conference on Knowledge Management and Information Sharing (KMIS-2012), pages 261-264

ISBN: 978-989-8565-31-0

 2012 SCITEPRESS (Science and Technology Publications, Lda.)

picture of the real world that exists in and around the

company.

3 EXAMPLES

For With the following examples, we address

collective change and dynamics in a new fashion.

We have created many ontology-based management

and leadership constructs and concepts and applied

those ontologies to Internet-based computer

applications. Several case studies have shown that

we can successfully reach a collective understanding

of current and future situations using these

applications, allowing management to obtain deeper

information from the grass-roots level rapidly (cf.

Ready and Truelove, 2011). This also enables

managers to deepen their knowledge of the current

position of their company, as well as achieving

valuable information concerning its future possible

interests.

3.1 The Folium and Talbot

Applications

Folium and Talbot are applications (Paajanen, 2006)

that are used to help the organization’s management

in the decision-making process when target

development plans are made to improve and support

organizational knowledge creation (c.f. Nonaka’s

SECI process, 1995) and organizational learning

(c.f. Tannenbaum’s model, 1997), on an objective

level. Both areas have a strategic nature. On a

practical level, Folium is used within the

organization to evaluate features that describe

activities, functions and practices concerning

organizational knowledge creation, current and

future. Talbot, in turn, is used to evaluate features

that describe activities, functions and practices

concerning organizational learning, current and

future. Folium and Talbot contain linguistic

indicative statements, which describe the features of

knowledge creation and learning organization in

practice, and respondents are asked to evaluate their

current reality and future vision as they perceive it

according to these statements. As a result of the

evaluation, a proactive vision is visualised, i.e. the

gap between the current reality and future vision.

The reasoning from the indicative statement

evaluation to the visualised proactive vision is made

with fuzzy logic; the statements are semantic entities

and the ontology is the information resident in a

knowledge base (Zadeh, 1973). Figures 1 and 2

show visual sample results from a technology

company. The concepts in the ontology are shown

on the left (in Figure 1 the cut words are: Merging

new knowledge, Spreading new knowledge and

Spending time). On the right, we see graphs showing

how the stakeholders perceived the current reality

and future vision levels of these concepts. The

current reality level is represented by the thinner

blue bars. The level refers to how well this concept

is organized at work. The difference between the

black curvy lines is the proactive vision (c.f.

Creative tension by Senge, 1995) that tells which

concepts and how much should be improved at

work. The length of the horizontal bars shows how

much the stakeholders’ perception about these

concepts deviate, i.e. it shows the asymmetry in their

knowledge and experience. In Figure 2, the Talbot

results show learning asymmetry results in a similar

way as in the knowledge creation example.

3.2 Evidence from the Test Runs

The sample graphs above show quite clearly:

 A holistic picture of knowledge creation and

learning, since we can see what the concepts in the

ontology are. This is important in order for

stakeholders (workers, managers, administrators,

funders, etc.) to see what is relevant.

 Asymmetry in terms of knowledge creation and

organizational learning. There are multiple

perceptions of knowledge creation and

organizational learning, at least, according to the

work roles, stakeholder roles and individuals.

 A bottom-up view of important strategic issues:

current state and proactive future state.

Requirements to management and leadership are

revealed. It would not be possible to guess

something similar than for example Figure 1 and 2

tell to managers and leaders. That is why this is a

great way to provide really easy and useful tools for

strategic management and leadership.

4 CONCLUSIONS

The software industry has attempted to meet the

demand described here for many years. In this

context the executive support and decision support

systems so far developed have provided only partial

solutions. Such systems have supported either

specific activities or specific processes; they have

not provided executives with the kind of support that

would enable them to acquire a collective, holistic

understanding of the issues, concepts and constructs

KMIS2012-InternationalConferenceonKnowledgeManagementandInformationSharing

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Figure 1: Folium results – Knowledge creation asymmetry and creative tension (Evolute database, 2012).

Figure 2: Talbot results – Learning asymmetry and creative tension (Evolute database, 2012).

and also the relations and interrelationships that

must be mastered in strategic management. We

show that by using their employees, businesses can

be more effective and responsive to daily

fluctuations and changes. The change intelligence

capability in the employees’ conscious experience

can be turned to active competence in the workplace.

Our work can help bring the employees closer to the

theoretical side of management and leadership and

thus help their managers and leaders run the

organization more effectively.

ACKNOWLEDGEMENTS

We have used the Evolute database, which is run by

Evolute llc, USA. We appreciate that we have had

possibility to use the database.

REFERENCES

Evolute database, (2012), see www.evolutellc.com.

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Ready, D. A., Truelove, E., (2011), The Power of

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