The first task of good corporate governance is to ensure the growth of individual firms and nations. To achieve this, corporate governance should not restrict itself to effective internal control and risk management by the Executive Board, but that the Executive Board defines and executres an effective external control as well.

Sustainable growth and profitability require more than just technological innovation or working more hours, different recipes are needed. We need to re-invent our business institutions to free ourselves from the conventions that hinder us to capture the opportunities of digital technology and the exploitation of content. Contrary to the present dominant notion of corporate governance, firms need to be in control with respect to their future. To achieve this, firms need to pay attention to their external control not only to their internal control.

The modular organisation provides many more degrees of freedom to the design the organisation of the firm to optimize the economics of the firm. However, this modular organisation is a two-edged sword, one edge being a better economizing of the firm, the other edge is a higher transparency for competitors with respect to the real sources of cash flow. This makes the firm vulnerable for precision attacks by competitors on those sources of cash flow. To ensure its future, a firm needs to have a far more sophisticated portfolio of activities, beyond the traditional capital investment based portfolio, a portfolio that more resembles the piece on a chessboard, requiring the mind of a grandmaster to win the game.

A book for executives and non-executives, strategists and managers, and for policy makers, in need of a fresh view on strategy, governance and organisation in a world of changing rules.

Table of contents