Dynamic Decisions

Dynamic Decisions

Energy PIVOT, Adaptive Moves, Winning BOUnCE

Ricardo G Barcelona

$49.90

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Description

Dynamic Decisions highlights how some managers and policymakers sleepwalk into decision paralysis. Strategically, they partly recognise their world is changing radically as energy systems transition. In deciding what to invest in, they default to rewarding the predictable and proven, often misdiagnosing the ignored risks of innately ambiguous markets. To remedy this, the author frames ambiguity as a source of opportunity. As extant advantages obsolesce, new entrants could disrupt to gain dominance. Some managers could repurpose, reframe, and reconfigure their resources and processes to create tomorrow's profitable niches today. To profit from these emerging business landscapes, managers can PIVOT and BOUnCE to win by transitioning into a dynamic mindset. Endowed with a creative mind to innovate, humans could reshape their firms and their societies. Armed with these capabilities, albeit partial, managers could choose to adapt responsive strategic actions that are tangible, actionable, and achievable, with policy sustaining societal benefits by expanding people's access to opportunities.

Dynamic Decisions is written for managers and policymakers that seek to benefit their firms and communities in how they conduct their business and themselves. Connecting theory to practice with actual business cases, this book is organised into four clusters that act as building blocks to structure the reader's decision-making process. Through experimentation, learning, and adaptation, the reader of Dynamic Decisions will redirect their strategic actions that are necessary to nurture tomorrow's profitable niches today.

Contents:

  • Foreword
  • About the Author
  • About the Book
  • List of Boxes
  • List of Charts
  • List of Tables
  • Introduction
  • Understanding Energy PIVOT:
    • From Impasse to PIVOT
    • Policy and Managerial Actions
  • Adaptive Moves:
    • Articulate a Purpose
    • Bounded Possibilities
    • Calibrate
    • Take Actions to De-risk
  • BOUnCE to Win:
    • Cost of Energy
    • Levers of Value
    • Price Taker
    • Oligopolistic Rivalries
  • Winning Actions:
    • PIVOT and BOUnCE to Profit
  • Glossary
  • Index

Readership: Managers and policymakers who seek to benefit their firms and communities in how they conduct their business; academics studying behavioural economics, investment, and green energy finance will also benefit from this book.

'To fully realise the benefits of a low-carbon energy future, a manager would require productive dialogue amongst stakeholders. Under a polarised societal milieu, it is tempting to see policy and energy firms to be necessarily at odds. As Chief Executive, I seek to align our purpose to work for a common good, recognising our diverse interests and capabilities. Dynamic Decisions places humans at the centre of decision-making, offering a fresh approach by framing dilemmas under ambiguous ecosystems. This allows policymakers and managers to rechannel their efforts to work on what they can do better so that society does well whilst firms also prosper.' - Antonio Brufau NiubóChairman, Repsol and Repsol Foundation, Spain

In Dynamic Decisions, Ricardo shares his deep understanding of the vagaries of energy transitions. He offers guidance on how to navigate them by using strategic insights to adapt investment choices under ambiguities. A must-read for managers facing strategic energy-related or capital-intensive investment decisions.' - Africa AriñoProfessor and Joachim Molins Figueras Chair of Strategic Alliances, IESE Business School, Spain, and President, Strategic Management Society, USA

'Ricardo's Dynamic Decisions is spot on in highlighting the importance of how managers and policy could profitably pivot as energy firms transition towards sustainable development paths. This is particularly important for the fast-growing Asian regions, where firms and governments could innovatively meet the climate challenges as today's transformational opportunities. The strategic decision approaches highlighted by Ricardo offer feasible pathways to achieve this under ambiguous conditions.' - Woochong UmManaging Director General, Asian Development Bank, Asia/Philippines

'In humanising investment evaluation, Ricardo brings together a way to harness the strengths of firms and policy. This works when a coherent managerial approach is employed to achieve a common purpose. Adaptively pivoting to an evolving low-carbon future would allow managers to sustain their firm's viability and outcompete rivals. Dynamic Decisions is Ricardo's latest contribution that explicitly highlights the ignored opportunities (or risks) that can be transformed into potentially profitable niches.' - Jikyeong KangPresident, Dean and MVP Chair in Marketing, Asian Institute of Management, Philippines, and Chairman, Board of Directors, AACSB, USA

'Ricardo is one of the most knowledgeable professionals in the business of energy, which faces at least three major uncertainties: technological, regulatory, and market. As economies transition from fossil fuels to renewable energy sources, business leaders face a number of important decisions. The effects on profitability and competitiveness of their firms could be long-lasting. In his previous book — Energy Investments — Ricardo highlights how managers err in misperceiving risks and suggests ways for them to reframe how lumpy investments ought to be evaluated. In Dynamic Decisions, by offering an excellent behavioural insight on managerial decisions, Ricardo proposes a process to deal with the multiple uncertainties facing the decision-maker that systematically identifies and exploits hidden opportunities.' - S Ramakrishna VelamuriProfessor and Dean, School of Management, Mahindra University, India, and Former Chengwei Chair of Entrepreneurship, China Europe International Business School (CEIBS), China

'Dynamic Decisions deepens managers' insights into how humans interact and shape decisions under evolving industry and policy ecosystems. As the author posit in Energy Investments, his previous book, scenarios and analytical tools inform managers but cannot prescribe a decision. In placing the person at the core of decision-making, how managers respond to uncertainties, extreme events such as pandemic, or risks, could turn gloom into lucrative niches that firms could pivot into the next boom.' - Bernardo M VillegasCo-Founder, University of Asia and the Pacific former member, Constitutional Commission, Philippines, and Board of Adviser, Rolls Royce, United Kingdom

'Ricardo's Dynamic Decisions should be thought-provoking for a wide range of energy professionals. In highlighting the risks that energy transition poses, Ricardo's work presents plenty of relatable case studies supporting that dynamic decision-making is required to reap the opportunities, and succeed in the energy sector of today and tomorrow.' - Rosalind ArcherHead, School of Engineering and Built Environment,Griffith University, Australia, and President, Engineering New Zealand

'Energy markets are very volatile because of both the nature of markets, and the geopolitical conditions that assert its influence. By making explicit how human behaviour could influence decisions, Ricardo's effort adds a lot of value. In particular, he analyses the interactions of technology and how it shapes market evolution. Ricardo's works provide insights into how appropriate decisions should be made under ambiguous conditions.' - Narendra K RustagiProfessor and Director, Centre for Global Business Studies, School of Business, Howard University, Washington DC, USA

'Prof Barcelona integrates insights from human behaviour, business, and policy, to highlight a need to deepen stakeholders' leading and learning cycles — from reacting and 'quick fixes' to tackling profound reinvention and rapid change. By providing a way around the complexity of ambiguous decision contexts, a more robust access is made feasible to analytical tools and mindsets for navigating the evolving decision ecosystem. Prof. Barcelona, the educator and mentor that he has also chosen to be, guides leaders to combine scenarios, option games, and behavioural economics to 'make sense' of emerging futures.' - Prof Maria Nieves R ConfesorProfessor, Asian Institute of Management, Philippines, and former Chair, International Labour Organisation, Switzerland

'The energy markets used to be highly regulated and predictable. With liberalising markets, participants often would live in fear of facing risk. Leveraging in Ricardo's deep knowledge of the energy market, and a broad interest in economic literature, he carefully deconstructs this myth. He argues that risk offers upside potential while allowing market participants to curtail adverse developments, when there is managerial flexibility.' - Benoît Chevalier-RoignantCo-author, Competitive Strategy: Options and Games (with Lenos Trigeorgis),and Professor, emlyon business school, France/International

'Ah, finally we are all discovering everything affects everything else and business must honour this. Managers who give priority to the common good can have all the stakeholders getting more than what they would have gotten otherwise. That is the mission of Ricardo's book.' - Terry MöllnerChair, Stakeholders Capital, a founder of the Calvert Funds, and formerly, Board Director of Ben & Jerry's for Sustainability, USA

'Bringing his deep understanding of the most important strategic issues, Ricardo offers us ways to address constructively the dilemmas we face, as business leaders. This enables us to help create a prosperous and economically sustainable future, in a world characterised by uncertainties and rapid changes. In an accessible manner, with humour, he illustrates how some management thinking come to life by testing it against the 'voices of the real world' from battle tested leaders operating in dynamic energy markets. Dynamic Decisions tracks multiple aspects of energy transitions, recommend convincing and actionable approaches, to inspire day-to-day as well as strategic actions of managers.' - Michael LaengleChief Financial Officer, and Member, Management Board, RAG Austria AG, Austria

'As the world starts to experience the consequences of climate change, energy companies are under extreme pressure from stakeholders to develop new business strategies to cope with the new dynamics of energy markets. This book is very relevant and a highly recommended read for anyone in the energy industry today.' - Stephen A ParadiesChairman, MORE Electric & Power Company, Philippines

'Ricardo's Dynamic Decisions examines in a direct and straightforward manner how infrastructure investment and financing could be reframed under rapidly changing conditions in Indonesia, as well as globally. In highlighting the inconvenient realities of continual renegotiations, rigid long-term obligations could create risks that are often ignored. In re-examining how policy and managers could positively interact, I recommend Dynamic Decisions for business leaders and practitioners to inform our strategic dialogues.' - Ir Montty GiriannaDeputy Minister in the Coordinating Ministry for Energy and Mining, Indonesia

'Through Dynamic Decisions, Ricardo gives energy professionals deep insights, supported by his research, into the interplay among policy, technology and business. It provides a framework that energy leaders may use to maximise utility, mitigate risks, and optimise stakeholder returns in an industry that is uncertain, volatile and ambiguous.' - Jorge A ConsunjiPresident and Chief Executive Officer, D M Consunji Inc, and Member, Board of Directors, Semirara Mining and Power Corporation, Philippines

'This book is timely and insightful. In the post pandemic world, strategic agility and operational excellence combined with stakeholder alignment, will be of even greater importance for those who strive to recover and succeed. Dynamic Decisions proposes a human-centred approach to addressing these cultural and leadership challenges.' - Gary Steelformer Member, Group Executive Committee, ABB, Switzerland

'The energy transition is gathering strong momentum globally, and will require bold decision-making and strategic pivots among industry participants. Prof. Barcelona's Dynamic Decisions couldn't have come at a better time to help equip decision-makers with a fresh and innovative approach to navigate the dynamic and disruptive environment.' - Eric John FranciaPresident and Chief Executive Officer, AC Energy, Asia-Pacific / Philippines

'Ricardo's take on a resource company's strategic advantages provokes in depth re-examination of managers' business assumptions. How leaders respond, and how they create opportunities from challenging markets, arise from their beliefs and values that guide their strategic actions. In Dynamic Decisions, Ricardo offers an adaptive and resilient take on sustainability where firms can repurpose, reframe, and reconfigure their resources to flourish amidst the ambiguities of changing markets.' - Maria Cristina C GotianunPresident and Chief Operating Officer, Semirara Mining and Power Corporation, Philippines

'Dynamic Decisions offers multiple perspectives on energy transition policies, and effectively caters to regulators, business practitioners and the academe. A masterful blend of theory and practice weave into the ambiguities arising from imperfect humans and markets.' - Francisco L VirayFormer Secretary of Energy, Philippines, and Dean, College of Engineering, University of the Philippines - Diliman, Philippines

'These times have indeed been extraordinary and unexpected. And all of us have had no choice but to step up to the plate, or perish. To have an impact, as the Aboitiz Group, our continued commitment in aspiring to do well by doing good, is sustained by our mindset to consistently innovate, improve and inspire. Our passion to help drive change for a better world by advancing business and communities, is underpinned with hope, realism and optimism. In this context, Ricardo Barcelona's book is a great and insightful read. He gives us practical examples as to how we can adapt, and win, in this remarkable time of our nation's history.' - Ana Margarita 'Ginggay' Hontiveros MalvarVice President, Reputation Management, Aboitiz Equity Ventures Inc., and Member, Board of Trustees, UN Global Compact Network, Philippines

'Modest in tone, sharp in his observations, Ricardo articulates the human dimension of doing sound sustainable business: Intriguingly timeless, priceless.' - Bas KloppenborgDirector, shpKlop, The Netherlands, and formerly, Commercial Effectiveness Lead, Shell Exploration & Production, Africa, Nigeria

'In Dynamic Decisions, Barcelona provides a fresh perspective that policy makers, industry practitioners and civil society stakeholders can use in creating a roadmap for advancing the goals of sustainability. His mastery of the subject matter combining actual experience in the energy industry and finance with deep insights honed in the halls of academia shines through this work. As an advocate for international public-private collaboration in promoting the role of lenders and investors in incentivising progressive alignment of emerging market companies' practices with sustainable development goals, I have benefited from Barcelona's analysis in formulating practical and actionable recommendations from the business sector to political decision-makers and government leaders in the Asia-Pacific region. I wholeheartedly encourage anyone who has genuine interest in this subject, especially those sincerely seeking ideas to promote sustainable development goals, to read this book.' - Julius Caesar ParreñasCoordinator of the Asia-Pacific Financial Forum, and Senior Advisor, Daiwa Institute of Research, Daiwa Securities Group, Tokyo, Japan

'Dynamic Decisions goes behind financial and economic data to explicitly surface assumptions, uncertainties, and human biases, to inform decision-makers' judgement. This often better prepares us to tackle future threats and challenges, and to act on opportunities hidden from plain sight.' - Anton PerdicesChief Operating Officer, Distribution Utilities, Aboitiz Power, Philippines

Key Features:

  • Presents a unified decision framework that incorporates human behaviour from a perspective of behavioural economics and finance. Decision making is seen as occurring under ambiguous and uncertain conditions, where managerial flexibility and how rivalries among competing firms are explicitly evaluated as to their impact on investment valuation
  • In using PIVOT, managers connect their investment decisions to the firm's purpose and insights from a portfolio perspective. In recognising ambiguities, managers learn to veer and overcome obstacles before taking irreversible commitments. This guides managerial decisions by providing a framework to move adaptively under uncertainties
  • Managers are informed by beliefs that influence their outlook and understanding of the context of their decisions. In making these factors explicit, the strategic assumptions are better understood collectively by managers. As a result, insights as to how different parties are incentivised, and how value is created and captured are used to inform how managers could affect their adaptive moves
  • Applied to transitioning energy systems, uncertainties become exploitable opportunities for managers to create arenas for tomorrow's profitable niches today. In tangible and actionable ways, managers may seek to repurpose their resources, to reposition their firm as energy markets evolve. Through experimentation and learning, managers could reframe their purpose, and execute their strategy by reconfiguring their firm's approach
  • In connecting theory to practice, actual business cases are presented, examined, and evaluated, where counter-intuitive insights are used to inform strategic dialogue and strategy formulation. In focusing on the manager as a human person, virtues such as humility, integrity, and generosity become the lynchpin for successful PIVOT and BOUnCE


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