Today an email arrived from The Cynefin Co: SenseMaker is turning 22. We have been using it for 10 of those years, from the study on business networking in the winter of 2015 to the one on weak signals this summer. In those five studies, companies told us about their own concrete cases and interpreted them themselves. Below are some of the conclusions from that ten-year period, and our invitation to the next study.

The first conclusion is that companies look at themselves from the inside. When we asked them in 2023, within the SBA in BiH2EU project, what had prompted them to improve something (Challenges and opportunities for improving business), by far the most common answers were cutting costs and raising efficiency, while a market opportunity appeared in a minority of the stories, mostly in agriculture and the food industry. A year later, on the topic of energy in the READy project (Business improvements in energy use), we got the same result: the decision is driven by expected savings, while new regulation and the chance of co-financing are much rarer motives. Saving money is a good reason and there is nothing wrong with it, but it is also a narrow one. An investment justified only by the electricity bill pays back through that bill and stops there, while the companies in those same stories that started from a market opportunity grew faster and went further. So before the next investment it is worth asking what it brings the company with its customers: does it open the door to a new one, does it answer a requirement that existing customers are already making, or is it something a customer the company wants to reach is asking for.

Second, a company’s next step usually resembles the previous one. The energy study found that the improvements companies plan are not radically new, but a repetition and extension of the first one: whoever installed solar panels adds more solar capacity, and whoever replaced the lighting moves on to equipment. Companies finance the first investment themselves, from their own funds and loans, and for the second, larger one they aim for a grant. This means that support makes most sense where a company has already taken the first step on its own and is getting ready for a bigger one. This year’s study on weak signals (Catching weak signals) confirms it: companies that already know their next step report a considerably greater impact of their past changes than those that will not continue.

Third, a good idea usually comes from the shop floor, and that is where it is most easily lost. In the same study, what companies do spontaneously is most often technical, and it is started by a production technologist, a shift supervisor or a skilled worker; the owners, who also submitted most of the stories, say so themselves. Changes that are turned into a rule, a card or a routine score about two points higher on a ten-point scale for how long they last than those that stay informal, and that is roughly the difference between a change that survives and one that disappears. Spontaneous improvisation is valuable as a source, but on its own it does not stick. Writing down how something is done and then introducing it as a rule is cheaper than any new investment.

Fourth, an outside actor changes the outcome, but rarely shows up. Stories in which a supplier, a consultant or a project took part show greater impact and better sustainability, yet in half of the stories from this year’s study there is no one from outside the company. We saw the same at the very beginning, in the study on business networking (Some current characteristics of cooperation between companies). Around a hundred stories showed back then that cooperation comes about spontaneously, through chance encounters, and not through official processes and meetings; that medium and large companies cooperate far more than small ones, which mostly compete with or ignore each other; and that positive feelings about cooperation grow with the regularity of contact. When asked what had helped them establish cooperation, companies did not name incentives, but the skills of their own workers. Behind all this lies a concrete loss, because companies turn down orders from abroad that they cannot handle alone (or never get them, for lack of qualifications and capacity), while a job that one company cannot take on, two or three together can. On top of that, companies do not let each other see how they work. Almost half of the companies in the 2023 study did not want their story published, although it contained no confidential information, and ideas taken from other companies have little influence on how a company sees its own improvements. A company that never asks anyone anything solves every problem from scratch, even though someone nearby has already solved the same one, and that is the most expensive way of learning there is.

The fifth conclusion comes from a topic that concerns anyone who bids in public tenders. When in 2018 we used this method for the first time in B&H to collect stories from participants in public procurement, from both bidders and contracting authorities (Two sides of the coin: integrity of contracting authorities and bidders in public procurement), it turned out that the most successful procurements were not the most transparent ones, but those that respondents marked as a mix of transparent and efficient. Where the procedure was orderly but inefficient, the stories were bad for everyone: a tender cancelled for the third time, a decision overturned because an ID number was missing from one statement, conditions written so that only one bidder could meet them, waiting until all the appeals were exhausted. Party interest almost never appeared on its own in the stories, but where it mixed with private interest, the stories were strongly negative. It also became clear that as the value of a procurement grows, problems move from the tendering stage to the decision stage, that is, to what happens between the opening of bids and the award of the contract: in the brackets above BAM 300,000, every problem respondents reported was in that stage. For a bidder this means the job does not end when the bid is submitted. After the bids are opened, it pays to follow what the evaluation committee is doing, to ask for the award notice and the reasoned decision, and to have someone ready to file an appeal, because the deadline for it runs from the day the decision arrives.

All these findings are public (linked above, in Serbian), and the publications are in the reading room on edabl.org. The stories are anonymous, and the findings are written to show what someone has already done in this economy and under these conditions, rather than what ought to be done. For a manager planning the next investment, for a technologist who does not want an idea to get lost, and for institutions designing support, this can be useful reading, and Eda a useful contact.

The gap between what people think about their work and what they have actually done shows up in this kind of research. Attitudes can be measured with a survey, but what actually happened can only be learned from the stories of people who were there. Dave Snowden of The Cynefin Co has a simple test for whether a situation is complex: does the available evidence support contradictory hypotheses. Such topics are easy to recognise in practice, because two opposite claims about them hold at the same time, as when the same economy has both high unemployment and companies that cannot find a worker for months. There an average explains little, and the picture comes together once enough individual cases have been collected. Those are the topics we find most interesting, with a sample large enough for the patterns to show clearly.

If you have a question in your company, sector, network or municipality that the numbers do not answer, this is a way to ask it. Feel free to get in touch, we will be glad to talk about it.

* This blog was translated from Serbian using AI. Original version can be found at https://edabl.org/deset-godina-prica-iz-prve-ruke-i-22-godine-postojanja-sensemakera/