Principle Based Management™
Principle Based Management is the business philosophy and framework developed by Charles Koch that empowers individuals and organizations to succeed long-term by applying the principles of mutual benefit.
What's at the core?
Principle Based Management emphasizes the role of business which is to create value for society - to make people's lives better. To exist long-term businesses must continually provide people with products and services they value.
Now, more than ever, we need to be faster than competitors and drive transformation to provide people with superior solutions they desire.
Virtuous cycles of mutual benefit
By being principle based, empowering employees, becoming a preferred partner and continually transforming, we create virtuous cycles of mutual benefit. These not only maximize our contributions to others, and our results, they create opportunities for individual growth.
We create virtuous cycles of mutual benefit by becoming a preferred partner of customers, employees, suppliers, communities and other core constituencies. We continually seek to identify and close the gaps between what you are and what you could be accomplishing if you were fully applying Principle Based Management™.
How is it "accelerated" by Design Thinking?
Any approaches, strategies, or methods that help us do those things better and faster should be considered.
There IS a proven approach - tuned over time and practiced by "designers" throughout history that result in new solutions that suit people's needs. It's more rapid because it's been built as a means to solve problems in new ways and in uncertain situations - and it results in market outcomes.
For decades a design thinking approach has been leveraged by individuals in every discipline. In the largest enterprises and by the most prestigious universities. This approach -accessible to all people- is known as Design Thinking - and it encompasses the mental models adopted from design.
The methods found in this toolkit have been created to help anyone apply these culturally-aligned mindsets, to accelerate business efforts and create more value for customers.
Learn more about how Design Thinking is advancing the Koch Vision:
Here's a look at the overlap between the mental models and key areas of Principle Based Management™ and Design Thinking:
These stories highlight a few examples of how MBM has been applied leveraging Design Thinking approaches.
GP Pro, ActiveAire
When GP Pro, a division of Georgia-Pacific, was looking to expand its product portfolio, the business applied Design Thinking to develop a fresh solution for a new market category. Through immersion in the customer experience, the business was able to identify key pain points and develop a pipeline of complementary products that solved these issues. The prototyping and value-exchange testing that followed allowed the business to quickly move to commercialization of a new line of ActiveAire™ products that can be now be found in restrooms across the United States.
The Principle Based Management team has seen the value of Design Thinking firsthand. With more than 130,000 global employees and continuing rapid growth, the team needed a better way of communicating the concepts and principles of Principle Based Management (previously called “MBM”) to an expanded audience.
Applying design thinking, the team was able to focus on the wants of its users by reframing its problem and developing a new way of distributing content and connecting with employees. MBM Go!, the result of the team’s efforts, is now replacing the traditional training using a combination of self-guided online and offline activities.
Though this article may very well be the first time you’ve heard of Design Thinking, as you can see, it’s actually already being utilized with great success across Koch and Koch’s Knowledge Network of Design an internal collective of more than 100 individuals from within Koch Industries who share the practice and value of design.
Another example that proves innovation can come from anywhere happened at Koch-Glitsch, when a manufacturing leader at a plant in Vinchiaturo, Italy looked to a related world in this example, mattress stitching and assembly to solve a problem the company had been having with assembling its structured packing elements used in istillation columns. By taking ownership of the problem and taking action, the employee helped inspire design thinking.