Complementarity in Organizations

Complementarity in
Organizations
Strategy, Leadership, Management,
Talent and Engagement in the Fourth
Industrial Revolution
Paul Turner
Complementarity in Organizations
Paul Turner
Complementarity in
Organizations
Strategy, Leadership, Management,
Talent and Engagement in the Fourth
Industrial Revolution
Paul Turner
Leeds Business School- Associate
Leeds Beckett University-Associate
Leeds, UK
ISBN 978-3-031-10653-8 ISBN 978-3-031-10654-5 (eBook)

https://doi.org/10.1007/978-3-031-10654-5
© The Editor(s) (if applicable) and The Author(s), under exclusive licence to Springer Nature
Switzerland AG 2022
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To Violet Renee Turner
Acknowledgements
Liz Barlow
Karthika Devi
Professor Martin Reynolds
And to the support and happiness given by Gail, Jane-Marie, Annette,
Harrison, Ellis, Sebastian, Jacob, Gary, Will
Heart like Roses
vii
Contents
1 From Singularity to Complementarity 1
2 The Fourth Industrial Revolution 31
3 The Origins of Complementarity 59
4 Complementarity and Business Strategy 87
5 Complementarity in Leadership and Management115
6 Complementarity in Talent and Workforce Engagement143
7 Complementarity in Organisation173
8 Complementarity and Competence-knowledge, Skills,

Attitudes, and Behaviours203
ix
x Contents
9 Complementarity
in Business Organisations- 20 Important
Conclusions233
Index261
About the Author
Paul Turner has held Professorial appointments at Universities in Leeds,

Birmingham, Nottingham and Cambridge. His business career included
Executive and Director positions in FTSE and Fortune companies, and
as Vice President of the CIPD. He was Chair of Human Asset, People
Innovation and the European Talent for Tomorrow Conferences as well
as being a judge on the Middle East HR, European HR Excellence and
the CIPD People Management Awards. Paul is the author or co-author
of The Making of the Modern Manager (2021), Employee Engagement
(2020), Leadership in Healthcare (2018), Talent Management in Healthcare
(2017), Make Your People Before You Make Your Products (2014), Workforce
Planning (2010), The Admirable Company (2008), Talent Strategy,
Management and Measurement (2007), Organisational Communication
(2003) and HR Forecasting and Planning (2002). He has written articles
for academic and business journals and the International Press. Paul has
a first degree from the University of East Anglia, a Ph.D. from the
University of Sheffield and is a Companion of the CIPD.
xi
List of Figures
Fig. 1.1 Business progression—complementarity, strategy and devel-

opment16
Fig. 1.2 Complementarity—at the core and at the periphery 22
Fig. 2.1 The Fourth Industrial Revolution—characteristics, impact and
response33
Fig. 4.1 Complementarity and business strategy five areas of potential 96
Fig. 5.1 Leadership and management competences for complementarity 124
Fig. 6.1 A model for developing talent management and workforce
engagement to achieve complementarity 160
Fig. 7.1 Organising for Complementarity 180
xiii
1
From Singularity to Complementarity
ompetitive Progression—Achieving Economic

C
Growth with a Positive Effect on Society
All business organisations strive for progression.
Progression is achieved through movement towards an objective by
converting energy within an organisation from latent potential to actual
force, and orchestrating assets and resources in support of this move-
ment. In addition, it means development- providing foundations for
future growth—by balancing a focus on short term gains with invest-
ments that will pay back in the longer term.
Progression manifests itself by results—profit, return on investment,
or the maximisation of shareholder value and by the successful adapta-
tion to contemporary environments including social objectives -fair-
trade practices, contribution to social welfare, respect for and
understanding about the environment, diversity, and equality of oppor-
tunity. It may be said that in a modern context, business progression
means achieving economic growth taking account of wider societal needs
and expectations. It means not only achieving competitive advantage but
investing to sustain that advantage in a positive, inclusive way.
© The Author(s), under exclusive license to Springer Nature Switzerland AG 2022 1

P. Turner, Complementarity in Organizations,
https://doi.org/10.1007/978-3-031-10654-5_1
2 P. Turner
There is a panoply of strategic thought as to how organisations can

achieve such advantage. A potential contributor to this process is that of
complementarity in which one capability reinforces the impact of
another capability. In this concept, the organisation would seek to exploit
its unique resources by combining them with others to produce a for-
mula that is difficult to imitate on the part of competitors. Whilst there
is no universal definition, one interpretation that is relevant to a business
context, is where both tangible and intangible assets combine and com-
plement each other rather than stand alone; where strategy, stewardship
and policy facilitate such combinations and where human resources
know what to do to make them effective. This holistic view is based on
the potential benefits of synergies or linkages between each of the organ-
isation’s elements from manufacturing or operations to marketing to sup-
ply chain management. The existence of complementarity across
management practices is put forward as an explanation for unit-level pro-
ductivity differences. (Cavaco & Crifo, 2014; Hong et al., 2015) It is an
idea that has evolved over time with both a scientific and economic foun-
dation. Its applications stretch from government policy to global finan-
cial regulation, from technological development to individual behaviour.
(Samuelson, 1974; Teece, 1986; Lenfant, 2006) It is also used to explain
the outstanding performance of organisations such as Amazon and
Disney as they apply complementarity principles across their business
units. Furthermore, in their definitive article Brynjolfsson, E. and
Milgrom, P. (2013) noted that organisations such as Wal-Mart, or Toyota
‘enjoyed sustained periods of high performance. As a result, they were
heavily studied by competitors, consultants and researchers, and many of
their methods were documented in great detail. Nonetheless, even when
competitors aggressively sought to imitate these methods, they did not
have the same degree of success as these market leaders. Complementarities
in organisations can help explain why.’ Identifying and utilising comple-
mentary assets will be potential success factors in the age of the Fourth
Industrial Revolution.
But the initiatives to do so require clarity about what the term means
in the context of business and the organisation. A reasonable option
therefore would be a definition of complementarity that will enable those
seeking business benefits—from functional synergy to competitive
advantage—to craft how they go about leveraging any potential comple-

mentarities they may have. Hence, from the many definitions and inter-
pretations, which will be discussed in more detail later, and for the
purposes of this book:
Complementarity is the interaction of business strategies and manage-

ment practices to produce coherent, aligned and mutually reinforcing
systems and processes that give superior outcomes (such as shareholder
value, profit, customer satisfaction, market share or cost reduction) over
those that would occur if such strategies or practices had taken place
independently of one another. It is where the complementary agency of
those strategies produces superior results, where the relations of inde-
pendent units or their evolution creates higher value than their indi-
vidual operation.
How to apply this interpretation will depend on those responsible

integrating activities into the organisation’s systems and processes. It will
be affected by the organisation’s dynamics and requires agility in a way
that enables new initiatives. Guiding all is the language of vision or mis-
sion, articulated in the form of objectives, strategy, stewardship, and pol-
icy, and brought to life by leadership, management, and a talented,
engaged workforce. In this respect, a good business strategy will focus on
all of these elements and seek coherence—an alignment between expecta-
tion and reality; congruence—where elements of the strategy are inte-
grated and reinforce each other; and consistency—between intention and
action. Their implementation will be through the application of the con-
cepts of business management, their language, systems, and processes—
which are locked into every aspect of organisational life. But, as the
Fourth Industrial Revolution gathers momentum, the scale and velocity
of change in the global economy is creating new challenges and causing
reflection about how to make tried and tested business theories and prac-
tices work in a radically different context. Whilst a confluence of new
technologies offers significant opportunity, business managers will face
an environment that is unlike anything that has gone before, transform-
ing conventional models of strategy, and forcing companies to redesign
both internal and external structures if they are to remain successful.
4 P. Turner
(Rumelt, 2011; Schoenwaelder, 2019; Lanteri, 2021) An understanding

of how the core concepts of strategy and management evolved and their
characteristics over time may provide pointers to how they may change in
future scenarios involving complementarity initiatives.
usiness Strategy—More than a Reflexive,

B
Intuitive Reaction to Market Forces
The primary concept upon which organisational performance depends is
its strategy, and its numerous, elaborate, definitions, models and method-
ologies, which proliferated as competition amongst industrial and com-
mercial organisations increased in intensity into the twentieth century.
The perception was that more was required than a reflexive, intuitive
reaction to market forces. Business strategy evolved with the scale and
increasing diversification of organisations and the concomitant increase
in levels of investment, which in turn led to the demand for a better
understanding of the time and place for a return on that investment.
It was from this milieu that corporate planning emerged in the 1960’s,
portfolio planning in the 1970’s and a greater focus on market analysis in
the 1980’s. Different approaches to strategy were informed by SWOT,
PESTLE, Gap analysis or Balanced Scorecards and used a wide variety of
strategic frameworks such as the iconic Ansoff and BCG strategic
decision-making matrices. Each of these was underpinned by a dominant
rationalist approach to strategic thinking—scan the environment, assess
strengths and weaknesses, formulate the strategy, and then proceed with
implementation. The view was that business strategists could apply analy-
sis to help shift the competitive equilibrium. From the mid 1980’s the
work of Michael Porter, five forces analysis, the value chain and the theo-
ries of competitive advantage, cemented the rationalist approach and, for
many, confirmed the assumption that there were benefits to an explicit
process of strategy formulation to ensure that policies and actions were
coordinated and directed to a common set of goals. Porter’s work was the
most comprehensive and influential of all the strategy concepts whereby
‘competitive advantage grows fundamentally out of the value a firm is
able to create for its buyers that exceeds the firm’s cost of creating it.’ He
argued that competitive advantage was influenced by the choice of com-
petitive scope and the range of a firm’s activities. (Porter, 1980, 1985;
Henderson, 1989; Kay et al., 2006)
Overarching all of these considerations was the belief that the maximi-
sation of shareholder value would not come about by serendipity but by
clear objectives, a well thought through strategy and plans, and an under-
standing of the value chain and the importance of each link in it. But the
greater depth of analysis implied in strategy setting brought a diversifica-
tion of strategic theory and practice. The literature of strategy prolifer-
ated, with a variety of distinct ‘schools,’ including design, planning,
positioning, entrepreneurial, learning, the cognitive school, the environ-
mental school, and the configuration school. Some of these were pre-
scriptive, concerned with models of how strategy should be formulated.
Some were about positioning the organisation, others about learning and
others still about charismatic leadership. (Ahlstrad et al., 1998)
Subsequently, a resource-based view of strategy and the exploitation of
core competences were enthusiastically embraced as alternatives. There
were plenty of models from which those involved in strategy could choose.
But the lack of consensus on the best way to approach strategy
prompted questions. Martin (2014) argued for example that a too rigid
approach could create a series of ‘comfort traps’ which would lull the
strategists into a false sense of control. Strategic planning and cost-based
thinking were often bound by ‘self-referential planning frameworks’
based on what the company could control thereby limiting a focus on
what it couldn’t. Further reservations were raised about the very processes
of strategic planning. Earlier, and to counter such perceived rigidity,
Henry Mintzberg wrote of the concept of emergent or crafted strategy
(1978 and 1987) that presented an approach requiring agility; a respon-
siveness to unanticipated events and the ability to ‘craft’ as opportunity
became clearer, using its resources to build advantage. At each end of a
spectrum Porter believed that the essence of strategy not only included
decisions about what to do but also choices about what not to do; whilst
Mintzberg viewed strategy as a pattern based on a stream of decisions.
There are multiple positions between these two points of view. One of
which, the Resource Based View (Barney, 1991) is of particular interest,
6 P. Turner
given its focus on the exploitation of internal resources in the achieve-

ment of competitive advantage—when resources are valuable, rare,
imperfectly imitable, and non-substitutable, they could create competi-
tive advantages, which explain the differences in overall performance.
Complementarity is the process by which such resources are allocated to
benefit the whole organisation (Hsu, 2013).
As the Fourth Industrial Revolution gathers momentum, there is a
panoply of strategic theory and practice from which organisations can
choose as they navigate their way through the transformed environment.
In its most explicit form, competitive advantage can be achieved by dif-
ferentiation or by being a lowest cost provider; it can be based on exploit-
ing unique competences or resources that exist within the organisation. It
can be based on a planned and systematic analysis of markets, or it can be
based on opportunistic agility to respond to whatever the environment
produces. Strategy can be concerned with adaptation to new environ-
ments, or developments within those environments; it can be concerned
with dealing with chaos or getting to grips with radical change. ‘At its
limit, strategy formation is not just about values or competences, and
capabilities, but also about ‘crisis and commitment, organisational learn-
ing and punctuated equilibrium, industrial organisation and social revo-
lution.’ (Ahlstrad et al., 1998) The shock to global order which came
about in the second decade of the twenty-first century added significantly
to the necessity to deal with crisis however this was manifested. Business
strategy has evolved from being less of a mould into which corporate
ingredients could be poured and a fully formed figure emerging, to more
like clay on a turntable, fashioned and crafted into shape.
Whatever model was used, it was not enough to have strategy setting
in isolation from other functions and so theories and practices of leader-
ship, general management, talent management and workforce engage-
ment developed—sometimes synchronised and sometimes in parallel—in
response to economic, social and technology dynamics. As the quest for
understanding of competitive advantage grew, so did questions about
what needed to be done to achieve it—what is good strategy, what makes
an effective leader, what is the role of the modern manager, how do we
define talent, what makes employees engaged- and the recognition of
their importance to business performance. In the contemporary
organisation, the agency of strategy, stewardship, and policy provide the

direction; talented leaders and managers decide on the allocation of
resource and navigate a course; a committed and skilled workforce carry
out operations, innovating and improving processes along the way. In
each of the functions, responsiveness to change has been remarkable.
Leadership and Management—Influencing

a Group to Commit Willingly
to a Common Goal
Accompanying the rise of theories about strategy and a surfeit of strategic
models, was a renewed focus on the type of leadership needed to match
corporate ambitions. From one perspective, leadership was seen as some-
thing that would be transformational, based on an individual’s charisma.
In some cases, leaders built enduring greatness through a blend of per-
sonal humility and professional will whilst some had emotional aware-
ness which allowed them to achieve more than those without (ie they
have high levels of emotional intelligence). For some, leadership was con-
cerned with authenticity, for others it required a ‘shift’ to a new level
where purpose, mastery, autonomy, and trust were characteristics of the
organisation and whose leaders shared aligned values and aspirations.
(Greenleaf, 1977; Burns, 1978; Bass, 1985; Conger & Kanungo, 1998;
Goleman, 1996, 1998; Collins, 2001; Goffee & Jones, 2006; Hlupic,
2014) In most cases, leaders were those people who could ‘mobilise oth-
ers to want to get extraordinary things done in organisations… transform
values into actions, visions into realities, obstacles into innovations, sep-
arateness into solidarity, risks into rewards … create a climate in which
people turn challenging opportunities into remarkable successes’ (Kouzes
& Posner, 2007). Leaders were people who could influence a group to
commit willingly to a common goal.
Analysis of the many and varied perspectives on leadership summarised
the approaches as, Person based which associated with the traits pertain-
ing to a leader’s character or personality including having a clear vision
and strategic objectives, decisiveness, being an inspiring communicator,
8 P. Turner
integrity, trust and delegation, honesty, and consistency. Or leadership

could be results based which is founded on realising potential as a distin-
guishing feature of the leader’s actions. Process based leadership on the
other hand used the assumption that ‘people that we attribute the term
leadership to, act differently to non-leaders.’. Position based leadership
defines the term as a spatial position i.e where a person sits in the organ-
isation’s hierarchy. Leadership has been categorised as trait, behaviour,
power-influence, situational, integrative or intra individual; as well as
being defined into generic groupings (such as that based on trait or
behaviour) and local leadership theories including functional leadership
or group and team leadership. (Alimo-Metcalfe & Alban-Metcalfe, 2003;
Grint, 2005; Yukl, 2010; Edger, 2012) Theories sometimes distinguished
between a leader who sits at the head of an organisation, department or
business unit and leadership which is a social phenomenon that occurs
at many organisational levels and points.
Given a wide array of leadership theories, there is support for Kilburg
and Donohue’s conclusion (2011) that ‘leadership is a complex, multidi-
mensional, emergent process in which the leader and followers use their
characteristics, capabilities, thoughts, feelings, and behaviours to create
mutually influencing relationships that enable them to coevolve strate-
gies, tactics, structures, processes, directions, and other methods of build-
ing and managing human enterprises.’ Nevertheless, and not for want of
trying, there is no universally accepted theory of leadership. Some 300
definitions, means that an analysis of leadership is more like looking
through the lens of a kaleidoscope rather than that of a microscope
because with each turn it changes shape and colour and hue. (Turner, 2019)
The subject of management is equally vibrant, and its genesis can be
traced back to the First Industrial Revolution and the principles of divi-
sion of labour as articulated in Adam Smith’s seminal work of classical
economy the Wealth of Nations in 1776. This was the beginning of the
organisational hierarchy, of planning and forecasting, the transformation
of the nature of work, the workforce to deliver it and the skills of the
people required to organise its production; the latter being known vari-
ously as executives, directors, managing partners, agents, foremen, under-
agents, over-men, corporals, supervisors, or stewards; but collectively as
leaders or managers. (Turner, 2021) During the nineteenth century the
seeds of Scientific Management were sown and cultivated. However, an

awareness that time clocks, stop watches and slide rules could only go so
far in informing how people should be managed, led to the growth of a
more human emphasis on management and from the early twentieth
century the emergence of Behavioural Management theories. At around
the time of the Third Industrial Revolution new approaches arose. Hence
Management Science underpinned new management theories, followed
by the importance of the organisational environment. In this latter
Management as Practice is of particular importance and within this
area, the innovations in practice introduced by successful global corpora-
tions that came out of the economies of Asia. There are many excellent
analyses which cover the various stages of management theory (Drucker,
1954, 1974; Child, 1969; Wilson & Thomson, 2009; Muldoon et al.,
2020) supporting a conclusion that management could be an economic
resource performing a series of technical functions which comprise the
organising and administering of other resources; or a system of authority
through which policy is translated into the execution of tasks; or an elite
social grouping which maintains the associated systems of authority. The
kaleidoscope’s lens would show management as shifting in form, some-
times expanding, sometimes contracting, always changing.
The final consideration has been that of how leaders differ from man-
agers and how leadership differs from management. This subject is one of
continuing debate in spite of the observations that ‘it is obvious that a
person can be a leader without being a manager (e.g. an informal leader),
and a person can be a manager without leading.’ (Yukl, 2010) There have
been attempts to distinguish between them. Two of the leading thinkers
on these subjects had clear points of view in answer to the question. Peter
Drucker was extremely forthright in his response; ‘as for separating man-
agement from leadership, that is nonsense—as much nonsense as separat-
ing management from entrepreneurship. Those are part and parcel of the
same job. They are different to be sure, but only as different as the right
hand from the left or the nose from the mouth. They belong to the same
body.’ Whilst Henry Mintzberg noted that ‘leadership cannot simply del-
egate management; instead of distinguishing managers from leaders, we
should see leaders as managers, and leadership as management practiced
well.’ Mintzberg’s belief that delineations between leadership and
10 P. Turner
management were wrong because ‘managing is controlling and doing and

dealing and thinking and leading and deciding and more.’ (Mintzberg,
2011) it would appear that there are more things that bind the concepts
of leadership and management together than separate them. Those con-
templating the nature of leadership and management in Industry 4.0.
organisations have a wide range of options.
F rom Exclusive to Inclusive—Defining Talent

and Engagement
With a strategy in place, leaders ready to transform and managers focused
on objectives, there is the question of productivity—what talent exists for
innovation and how engaged is the workforce with the organisation’s
direction and their roles in it. Recognition of the importance of effective
people management—in particular, talent and workforce engagement—
too often regarded adjuncts to the financial aspects of the strategic plan,
has increased. However, as in the case of strategy and leadership, opinions
abound about the precise meaning of both terms.
The greater focus on talent came about with the seminal work of
Chambers et al. (1998a) who captured the talent zeitgeist of a period in
which talent shortages were prevalent from the mid 1990’s. In the War for
Talent, publications (Chambers et al., 1998a, 1998b) ‘C suite’ executives
were found to be in short supply because of demographics (insufficient
people within the normal experience range of executives and senior man-
agers) and demand side economic growth forecasts. An imbalance
between the two, created intense competition for the best people and the
position was deemed to be so dire that the shortage of executive talent
was a threat to business survival. But it was soon clear that talent short-
ages were not confined to those in a narrow group of people in executive
positions and with the growing recognition that talent management was
necessary organisation wide and was a strategic issue (Cappelli, 2008;
Collings & Mellahi, 2009, 2013; Tarique & Schuler, 2010; Collings
et al., 2015; Cascio & Boudreau, 2016). The perceived inequality of hav-
ing only a few people as being identified with talent in the exclusive
approach; the experience of global organisations in their quest to fill the
roles of global specialists (such as project managers who were able to

manage across cultural and geographic boundaries); and the recognition
that there were talent shortages at many levels, brought about reflection
on the approach. This led to a more comprehensive, inclusive, perspective
on talent. This inclusivity was articulated by the UK’s professional organ-
isation, the Chartered Institute of Personnel and Development. (Tansley
et al., 2007).
This discussion was focused on talent at the organisational rather than
the individual level but attempts to define talent have also been couched
in terms of natural ability, mastery, commitment and fit, performance,
competences, capabilities, and commitment. (Gallardo-Gallardo et al.,
2013) There is, however, a contextual element that permeates much of
current thinking about talent. Ulrich and Smallwood’s (2011) research
refined the approach and proposed a model which identified talent seg-
ments to facilitate the efficient allocation of resources across the organ-
isation. In this analysis talent covers a wide span of the organisation and
the management of talent was a whole organisation enterprise. In the
twenty years since the term ‘talent war’ was first articulated, the manage-
ment of talent, its attraction and retention has been high on the corpo-
rate agenda.
And more recently, there is also recognition of the strategic importance
of workforce engagement. This is an area of organisational practice that
has been located within the subject of people or HR management but is
increasingly viewed in other organisational contexts because of its impact
on a range of business, service, or operational outcomes. As in the case of
leadership, management and talent, defining the term ‘engagement’
proved to be problematic with some 50 definitions emerging—‘more
than enough to confuse even the most positive people managers.’
(Huggett, 2009). The reason for the intensity of activity can be found in
the high level of attributed benefits showing relationships between
employee engagement and shareholder returns, operating income, reve-
nue growth, profit margins, creativity and innovation and customer or
client satisfaction, whilst work engagement has been associated with
turnover intention, task performance, contextual performance, and
employee well-being. (Saks, 2006, 2017; Schwarz, 2012; Bakker, 2017)
There is further evidence that engaged employees outperformed
12 P. Turner
non-engaged co-workers. The US based Society for Human Resource

Management (SHRM) concluded that ‘employees who are engaged in
their work and committed to their organisations give companies crucial
competitive advantages—including higher productivity and lower
employee turnover.’ (Vance, SHRM 2006; 1) The Chartered Institute of
Personnel and Development (CIPD) concluded that there were positive
relationships with profit, revenue growth, customer satisfaction, produc-
tivity, innovation, staff retention and efficiency. (CIPD, 2017)
The academic narrative on employee engagement is rich and diverse
with significant contributions from inter alia Maslach and Leiter (1997).
Schaufeli and Bakker (2004); Saks (2006, 2017); and Albrecht et al.
(2018). As a result, a wide range of terminology has been used whereby
engagement is viewed through the lens of emotional and rational factors
such as enthusiasm, passion, satisfaction, confidence, empowerment,
and positivity of attitudes; a person’s ‘preferred self ’ in behaviour which
promotes connections to work and to others. Schaufeli and Bakker
(2004) defined engagement as a positive work-related state characterized
by vigour, dedication, and absorption; where vigour relates to energy and
resilience; dedication to feeling enthusiasm and being inspired by one’s
work. Absorption is the intense concentration in the work being under-
taken. Christian et al. (2011) considered that employee engagement had
a psychological connection with the performance of work tasks; the self-
investment of personal resources in work and was a state of being rather
than a trait or characteristic. The analyses suggest that employee engage-
ment is connected to both the job and the organisation and is an active,
work-related state—although there is debate about whether employee
engagement is a trait, psychological state or a behaviour. From these per-
spectives engagement may be viewed as the simultaneous employment
and expression of a person’s ‘preferred self ’ in task behaviours that pro-
mote connections to work and to others, personal presence (physical,
cognitive, and emotional), and active, full role performance.’ (Saks,
2017.) A holistic analysis showed that considerations of employee
engagement could be seen not only in psychological terms but also in
relation to the sociology of work and the organisation of work.
(Turner, 2020)
A compelling conclusion about both talent and workforce engagement

is that both concepts are essentially contextual. There is no grand unify-
ing theory in either case. Instead, organisations have adapted the defini-
tions in ways that suit their specific circumstances. Nevertheless, questions
remain about what is the nature of the workforce in the Industry 4.0
environment, what skills are required to work in smart workplaces and
what is the nature of talent in this new environment?
Organisations—Collections of Individuals
and Political Systems with Defined
Boundaries, Goals and Values, Administrative
Mechanisms, and Hierarchies of Power
A further consideration on the theme of progression, is that of organisa-
tion design and development. In the early stages of industrialisation, lon-
ger production runs, and new levels of supervision necessitated a level of
formality, and an introduction of hierarchy albeit limited in depth and
scope. This period was not only the genesis of modern management but
also the genesis of modern organisation. As industrial and commercial
opportunities grew, an ‘American way’ of business was shown to be more
efficient. In this instance new management processes became the norm,
based around the scientific management methods of Taylor, and deployed
in large scale industrial units epitomised by Henry Ford’s factories.
Organisations became more structured—Weberian hierarchies- and
accountabilities for each layer of design or process were formulated. Later,
more people-oriented business methods—a human relations approach—
was used to replace or supplement the purely process driven methods that
had provided the bedrock of industrial development. By the time of the
Third Industrial Revolution from the middle of the twentieth century,
Asian organisations, first from Japan, then the Asian Dragons and Asian
Tigers and subsequently Indian and Chinese organisations, took advan-
tage of new technologies and globalisation in remarkable levels of busi-
ness performance, often introducing new forms of management or
organisation design.
14 P. Turner
In all cases organisations are both collections of individuals and politi-

cal systems. They have defined boundaries, goals and values, administra-
tive mechanisms, and hierarchies of power. Their structure influences the
behaviour of individuals and groups and determines how job tasks are
divided, prioritized, and coordinated. Traditionally, business organisa-
tions have been functional, geographic, or product-oriented structures
and based on the principle of unity of command and authority on an
unbroken line. However, more recent developments present the organisa-
tion as a holistic phenomenon. It is not a static configuration but a con-
stant process of design and redesign and is driven not only by
technical-structural rules but also by general ones. Hence contemporane-
ously, organisations have evolved into new forms—ecosystems, networks,
matrices or swarms to enable them to address more complex tasks in
more complex environments. And of particular relevance to this book the
idea of complementarity, which proposes that in the objective of achiev-
ing optimal fit, the design of organisations should seek to leverage any
interdependencies between organisational elements, rather than dealing
with individual elements singularly or separately. This is ‘chemistry of
organisation,’ the combination of organisational elements, analogous to
that of chemical elements composing a variety of substances. In all cases,
however defined, organisations offer ‘a fine weave of influence patterns
whereby individuals or groups seek to influence others to think or act in
particular ways.’ (Handy, 1976; Grandori & Furnari, 2008; Magalhaes,
2018; Sytch et al., 2018; Giri & Ramakrishnan, 2019)
In future, progression will depend on the ability to craft strategy
through these complexities, on agility and flexibility in organisational
design and response, on the ability to integrate new technologies across
the value chain from product design to sourcing of materials in the sup-
ply chain to manufacture to marketing, and of the full application of the
talents of all the workforce in an inclusive environment. The pioneering
work of Milgrom and Roberts (1990) offers important insights. They
argued that flexibility in equipment and product design, together with an
emphasis on speed to market and overlaps in design, product and process
engineering were mutually complementary and could be adopted
together—each making the other more attractive. Only coordinated
changes among all of the variables would generate optimum outcomes.
‘Significant complementarities in a rapidly changing environment pro-

vide a reason for close coordination between functions.’ In this construct,
profit maximising firms adopt a coherent business strategy that exploits
complementarities. This involves recognising that decisions should be
made across a number of variables in a ‘cluster of complements.’ In place
of the singularity of decision making is the complementarity of decision
making. With AI, more robots, and smart machines in day- to- day oper-
ations the physical and virtual world will fuse together. Such a radically
different type of environment will require organisations to ‘master the
profound technological challenges at work and transform them into
opportunities.’ (WEF, 2019a, 2019b, 2019c) The design and structure of
that organisation will be an important part of the formula or chemistry
by which progress is achieved.
ources of Progression over Four

S
Industrial Revolutions
As outlined above and visualised in Fig. 1.1 the theory and practice of
business management have been well served by research and evidence
with the principles surrounding key disciplines being honed, over a long
period of time, through a sequence of challenge and response. The value
of tangible assets has been increased by effective competitive strategies
leading to competitive advantage, embracing all aspects of the value chain
from cost management through to the development of leaders, the cre-
ation of a talented engaged workforce and effective organisational designs.
In recent times recognition of the importance of intangible assets—from
brand value to corporate ‘admiration;’ from technical prowess and know
how to strategic capability—has grown and strategy setting will increas-
ingly take account of their value. In a knowledge-based economy, com-
petitive advantage is increasingly rooted in the management of intellectual
capital, and intangibles rather than tangible assets. (Nakata et al., 2010)
Insights into all of the elements that are identified in this book as core
sources of progression arise from a vast array of supporting material, stra-
tegic models, leadership and management competence lists, talent man-
agement programmes and tools and measures for employee engagement.
16 P. Turner
Business Progression
Objective
Objective Objective
progressive and
increase the value of increase the value of
sustainable
tangible assets intangible assets
development
develop people or
respect for the
human capital with
competitive advantage competitive strategy environment and fair
cross organisational
trade practices
capability
by effective strategy resepct for diversity

through setting systems and increase information
capital through and creation of
differentiation against processes which go
exploitation of equality of
competitors beyond singularity to
knowledge opportunity
complementarity
through cost identify and build

developing leadership organisation capital contribution to social
leadership against
and management through networks in welfare
competitors
competence the development of
an ecosystem
with agile governance synergies through

and pace of deliver
talent management
adaptability complementarity
and workforce
value by synergies
engagement
between intangibles
identifying and
implementing organisation design and
complementarities development to foster
collaboration and
knowledge management
Fig. 1.1 Business progression—complementarity, strategy and development
These models have increased in their incidence and sophistication, in

response to the rapidly changing environments of Four Industrial
Revolutions, though most notably during the course of the Third as
organisations took the learning from the scientific management processes
and Weberian hierarchies from earlier times into a global context. Today,
thousands of business schools worldwide teach business theory and prac-
tice; business consultancies offer support through bespoke models cover-
ing every aspect of business strategy and operations and leaders and
managers bring their transformational or transactional skills to bear in
carrying out their roles. Informed and influential business leaders or

‘gurus’ have carried their messages throughout the world’s business organ-
isations. From Taylor to Weber, Follet to Washington; Drucker to Handy,
to Porter; Mintzberg to Kanter, Taiichi Ohno to Soichiro Honda; Zhang
Ruimin to Lakshmi Mittal—each of whom were and remain influential
in their industries, communities and beyond. If the intent behind the
research and development of strategic models was to help business pros-
per, then they can claim success. The future challenge will be to bring all
of these elements together through whole system change which includes
strategy, structure and process.
There has been tangible progress in the world’s economies over the past
50 years. If we compare economic prosperity today with any earlier time,
‘we see that every single region is richer than ever before in its history.’
And the enduring nature of capitalism has survived seismic shocks from
the Great Depression in the 1920’s and 30’s to the Great Banking Crisis
of 2008 interspersed with Pandemic, War and Political Upheaval.
Through judicious intervention by government or judicious non-
intervention by government, the average person in the world today is 4.4
times richer than in 1950. (Roser, 2013) GDP per capita in the USA at
the time of independence was around $2500, but by 2018—roughly
240 years after independence—GDP per capita had increased by more
than 20 times to $55,335. The trend in the USA can be used as a bell-
wether for others whether they are in Europe, in China, India or Japan
each of which have demonstrated phenomenal economic growth. Of
course, these high-level average figures conceal the reality of disparity in
wealth distribution, the haves and have nots, the somewheres and every-
wheres, the left behind. But what they can’t conceal is that today, the
world is a more prosperous place than it was, that there is less poverty and
more opportunity.
Behind macro-economic growth were the giants of corporate develop-
ment. In the USA these included Coca Cola, Westinghouse Electric,
General Electric, Pepsico, Ford Motor, Gillette, IBM and Walt Disney—
which all came to life during the Second Industrial Revolution. Companies
such as Honda, Matsushita—with brand names National and Panasonic—
Toyota, Sumitomo, Mitsui, Mitsubishi, and Sony achieved global success
through their product design and development, manufacturing or service
18 P. Turner
prowess and effective management aligned to international trade and glo-

balisation during the Third. As did companies such as Samsung, BP,
Volkswagen, Lloyds and Unilever. Not only was it the established large
organisations that could be successful through the globalisation of oppor-
tunity but newer, agile, technologically adept, ones too. Corporations
such as Apple and Google founded in 1998; Facebook, launched in 2004
(with 2.5 billion users) and Chinese company Alibaba founded in 1999,
are worth close to or into the trillions; by applying technologies with new
management and organisational formats that saw them grow to be
amongst the largest companies in the world. Amazon—whose business
model, already a benchmark for the application of Industry 4.0 technolo-
gies—was bolstered by its remarkable adaptation to COVID 19’s far
reaching implications, has become one of the world’s most valuable com-
panies; and in 2021 the Tesla and SpaceX companies reached an astonish-
ing market value. And of course, there are the thousands of SME’s that
have prospered in every geography. Each industrial revolution brought
the opportunity for value and wealth creation to those organisations that
had the foresight, entrepreneurial drive, and preparedness to risk capital
investment. Each one of these organisations also had the need for leaders
and managers to take key decisions about strategy or direction, and man-
agers to take responsibility for implementation and application.
(Turner, 2021)
Synthesizing the various points of view suggests that in contemporary
organisations, business management comprises of a series of interlinked
activities. In the first place, the organisation will have objectives. These
might be related to shareholder value, rate of return on investment, mar-
ket share or geographic expansion. They will represent where the organ-
isation desires to be. Strategies will then articulate how the organisation
intends to get there and to where resource will be allocated in so doing.
It will be up to leaders and managers to convert strategy into action
through their competences, talented people to convert tacit knowledge
into explicit knowledge and a workforce to convert objectives into out-
puts based on their engagement with the overall purpose and clarity
about their roles in contributing to it. The analysis of the evolution of
these concepts has shown there was no golden ticket to guaranteed suc-
cess and the sequence of challenge and response that epitomised early
industrial and commercial ventures reflected a willingness to learn and to

adapt on the part of entrepreneurs and leaders.
These experiences showed the necessity of sufficient resources, as well
as a clear understanding about intent, priorities, and actions among key
stakeholders. Effective strategy execution depends on good communica-
tion, resource allocation, coordinated actions, clear goals and responsi-
bilities. Of particular interest to this book, the need to overcome silo
behaviour, sub-optimization, ineffective cultures, and a resistance to
change were particularly important since too often the failure of organ-
isation stemmed from the inability to translate a broad competitive strat-
egy into the specific action steps needed to gain competitive advantage.
(Porter, 1985; Rumelt, 2011; Kraaijenbrink, 2019) A conclusion that is
of particular relevance is that some of these failures could be attributed to
singularity—that is discreet interventions in a specific function such as
the creation of a new strategy, the appointment of a visionary or charis-
matic leader or innovations in operational management- taking place
with little or no coordination with other strategies or activities within the
organisation. Sets of concepts or actions become conflicting rather than
coherent. At best this would result in an uncoordinated, sub optimal
activity, at worst it could destroy value. The objective therefore is to have
three elements in place—these being of coherence, congruence and con-
sistency—to improve the odds of a successful execution of strategy. The
generation of business value—through such resources as IT- is contingent
upon the availability of other complementary organisational resources
and capacities. (Moreno et al., 2019) A complementarity approach
instead of one of singularity may enhance this process.
omplementarity is the Antithesis

C
of Singularity
It can be explained as follows; ‘Complementary goods are used together.
Examples include right and left shoes; razors and blades; cake and icing;
horses and carriages; cars and highways; TV sets and TV shows; com-
puter hardware and software; and tea, hot water and a cup. The value of
a group of complements in joint use is super-additive, that is, the things
20 P. Turner
used together are more valuable (to someone) than the sum of their val-
ues in separate use.’(Baldwin, 2018)
Competitive advantage will only remain an advantage if an organisa-
tion builds in progression as part of its value chain, progression means
forward movement in the generation of tangible assets, intangible assets,
and sustainable development. In this respect complementarity holds that
the business phenomena of strategy, leadership, management, talent, and
engagement, have complementary properties which, if recognised and
directed, can have a broader impact than if they were regarded as inde-
pendent activities. It is concerned with ‘the valuable, unique, and inimi-
table synergy that can be realized by integrating complementary resources
provides an opportunity for the firm to create competitive advantages
that can be sustained for a period of time.’ (Harrison et al., 2001)
In this regard the concept of complementarity has been applied across
organisational theory and practice. Most notably Milgrom and Roberts
(1990) applied it to the shift from mass production to modern manufac-
turing, with the proposition that doing more of one thing increases the
returns to doing more of another. ‘The theoretical model specified comple-
mentarities between an organisation’s strategy, structure, and managerial
process….The core insight is that certain configurations of organisational
structures and practices are associated with a firm’s competitive advan-
tages.’ (Jackson & Ni, 2013) The challenge to all organisations is to ensure
that the energy unleashed by such activity is experienced as positive force
that has benefits to the whole organisation rather than conditional poten-
tial that has benefits for a part. Complementarity is the principle that the
outcomes of singular initiatives will be improved where they take account
of the potential synergistic opportunity with other initiatives. It brings
together the properties of singular activities into a complementary frame-
work which takes account of the totality of the phenomena.
Progression through complementarity will have occurred when coher-
ent, aligned, mutually reinforcing business strategies and management
practices give superior outcomes (such as shareholder value, profit, cus-
tomer satisfaction, market share or cost reduction) to those that would
occur if such strategies or practices had taken place independently of one
another. It is where the complementary agency of those strategies pro-
duces superior results. The core tenets of this hypothesis are:
• The performance of the whole organisation will be improved when

there is complementarity between elements of business strategy—for
example between the technology strategy and the marketing strategy
or the finance strategy.
• The performance of the whole organisation will be improved when
there is complementarity between business strategy, leadership, man-
agement, talent and engagement; where there is a culture of comple-
mentarity backed by systems and processes designed specifically to
recognise and address complementarity.
• The outcomes of business strategy will be superior if the strategy is
complemented by leadership, management, talent and engagement
practices that are specifically incorporated into the processes for achiev-
ing such outcomes.
• The performance of leaders will improve if leadership competences are
complemented by management competences; the performance of
managers will improve if they complement traditional management
competences with those traditionally ascribed to leaders.
• Workforce engagement will improve if it is complemented by talent
management practice that addresses engagement issues; the perfor-
mance of talent management will be enhanced by talent aligned
engagement practices.
In particular, the book will address the idea that there are synergies to
be had where organisational functions or practices go beyond singular-
ity—strategies that take place with little reference to others- to comple-
mentarity. Complementarity holds that the business phenomena of
strategy, leadership, management, talent or engagement, have properties
which, if recognised and directed, can have a broader impact than if they
were regarded as independent activities. This book is concerned with the
idea of progress in organisations as we stand on the cusp of the Fourth
Industrial revolution or Industry 4.0.
There are elements of business strategy that can stand alone. But there
are elements that would benefit from being linked to and associated with
others as shown in Fig. 1.2. It is to the latter that complementarity
applies.
22 P. Turner
complementarity
complementarity between talent
between leadership management and
and management workforce
engagement
complementarity
complementarity in
between business unit
organisation design
or functional
and development
strategies
complementarity
outcomes and
benefits for the
whole organisation
Fig. 1.2 Complementarity—at the core and at the periphery
A confluence of technologies will transform every aspect of how organ-

isations operate; from the design and creation of products and services to
how they are distributed to market. The ubiquity of new technologies
will ensure its presence in every aspect of life and work. The context
within which business takes place will be radically different—a great reset
or a great transformation. The challenge will be to put in place a business
model to take advantage of the opportunities. (Turner, 2021) ‘Strategic
coordination or coherence is not ad hoc mutual adjustment. It is coher-
ence imposed on a system by policy and design. More specifically design
is the engineering of fit among parts, specifying how actions and resources
will be combined.’ (Rumelt, 2011) Complementarity will be a funda-
mental consideration in this process.
The Structure of the Book

This chapter has covered the nature of industrial revolutions; how organ-
isations have adapted to date; and some of the challenges ahead. I also
outlined the idea of progression in organisations and how complementar-
ity can enhance the execution of business strategy. Chapter 2 will look in
more detail at the characteristics and nature of the Fourth Industrial

Revolution, some of its opportunities and challenges and the strategic
options open to organisations as they navigate the transformed industrial
and commercial world. The issues to be addressed are about the nature of
strategy, of leadership and management and the role of talent and work-
force engagement in the face of these dramatic, powerful forces for
change—which are themselves compounded by a compelling narrative
on equality and diversity in race and gender; and the impact on life and
work of COVID 19.
Chapter 3 will concentrate on the concept of Complementarity and
its relevance to business. It will define complementarity and evaluate its
possibilities; provide a literature review of how the subject has evolved
from its basis in quantum physics and show how the concept can be
applied in the milieu of modern business management. It is proposed
that a comprehensive response to the new, challenging context will be
enhanced if the elements of Strategy, Leadership, Management, Talent
and Engagement become mutually reinforcing. Chapter 4 will seek to
apply the concept of Complementarity to strategy setting and strategic
choice with the hypothesis that single issue competitive advantage may not
be the only option available to organisations in Industry 4.0. As such, pros-
perity will not only come about by pace and agility; or by cost leadership
or differentiation; but by the ability to make sure that every investment
creates advantage across the whole organisation; and that such invest-
ments are mutually reinforcing. To achieve this will require strategies that
recognise complementarity. Chapter 5 will apply a similar process to the
subjects of leadership and management with a working hypothesis that
the qualities of leadership and the qualities of management, when combined,
produce more than the sum of the qualities of leadership or the qualities of
management as singular instances. The outcome will be a complementarity
model of leadership and management.
Chapter 6 will analyse the potential for Complementarity in talent and
engagement with a working hypothesis that the activities of talent manage-
ment, when combined with and complementary to the activities of employee
engagement, produce more than the sum of the benefits of each when treated
as singular events. The outcome will be a complementarity model of talent
and engagement. Chapter 7 will review Complementarity in
24 P. Turner
organisation design and development with the hypothesis that when the
qualities of leadership complement those of management which in turn com-
plement those of talent management and employee engagement in a holistic
model of organisation, the outcomes will exceed the sum of each of these phe-
nomena as singular events. The outcome will be a complementarity model
of organisation. It will focus on the creation and dissemination of knowl-
edge, an emphasis on collaboration to ensure that knowledge is applied in
an optimal way across the organisation, leaders and managers who are
committed to organisation wide goals and objectives as much as func-
tional or business unit ones; talent that is regarded as a corporate resource
and is deployed for the benefit of the wider organisation; and workforce
engagement that is based on knowledge, skills, attitudes and behaviours
that add to the strength of the organisation as a whole. Chapter 8 will
review the knowledge, skills, attitudes, and behaviours required to ensure
that the concept of Complementarity is applied to optimum effect. It will
focus on organisational competence and how this will be developed with
the application of complementarity; and the leadership and management
competences to facilitate this process. It will cover the meaning of compe-
tence at all levels, a literature review on the subject and a methodology for
identifying the competences required in a complementarity system,
organisation, and culture. Finally, Chap. 9 will present 20 important con-
clusions and outline the benefits of taking a more comprehensive, holistic
perspective when considering the areas of strategy, leadership, manage-
ment, talent and engagement and highlight the benefits of so doing.
Excellence in the singularity of a strategy—such as cost leadership or
differentiation, or the vision of charismatic leaders or innovations in
operational management- underpinned the achievement of competitive
advantage. But now, a confluence of technologies will transform how
organisations operate; how they design and create their products and ser-
vices and how they distribute them to market. These developments will
benefit organisations that are able to adapt and to integrate their opera-
tions and services in an ‘extended ecosystem.’ The context within which
business takes place will be radically different—a great reset or a great
transformation. The challenge will be to put in place business models to
take advantage of the opportunities, but the question is, what is the best
business model—‘as our knowledge becomes wider, we must always be
prepared therefore to expect alterations in the points of view best suited for the
ordering of our experience.’ (Bohr, 1929)
We are on the brink of a Fourth Industrial Revolution which will fun-
damentally alter the way we live, work, and relate to one another. ‘In its
scale, scope, and complexity, the transformation will be unlike anything
humankind has experienced before.’ Robotics, advanced materials, genetic
modifications, the Internet of Things, drones, neuro-technologies,
autonomous vehicles, artificial intelligence, and machine vision, will
become integrated into physical, social, and political spaces, altering
behaviours, relationships, and meaning. Fundamentally, Society 4.0. and
Industry 4.0. will bring about significant shifts in the way that economic,
political, and social value is created, exchanged, and distributed. In this
context, an important question is how can commercial organisations
adapt their business models and modus operandi to compete success-
fully? This book seeks to address the point by applying the concept of
complementarity to business areas that are usually dealt with indepen-
dently—these being Strategy, Leadership, Management, Talent and
Engagement. The point of view is that organisational success will come
about not only by singularity—discreet interventions in these areas—
but also by complementarity—organisation wide interventions that
have synchronicity—connecting each of the functions to a broader pur-
pose. Complementarity means organisational constructs and actions that
are collaborative, multi layered, multi-faceted and add to the competi-
tiveness of the whole organisation. The argument being put forward is
that whilst the factors of an organisation will continue to affect each
other in one of three ways: independent, substitutive, and complemen-
tary, it will be towards the latter that a greater level of importance is
attached.
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2
The Fourth Industrial Revolution
F ourth Industrial Revolution—‘Unlike

Anything Humankind has Experienced Before’
We are on the cusp of a technological revolution that will have ramifica-
tions for the world’s economies and societies.
It comes about during a 250-year cycle in which the development of
the modern capitalist world can be set within a framework of Four
Industrial Revolutions. A common theme running through the First,
Second and Third was the belief that society was entering a new age in
which existing technologies would become largely obsolete, setting off a
migration of physical, financial, and human capital from established or
traditional to alternative sources of value creation. Each revolution was
accompanied by social, political and economic change. And each change
was considered to be more dramatic than the one that had gone before.
With each revolution came new ways of living and new means to live.
And with each revolution came new ways to work, with technology
development being the common denominator. In these scenarios, indus-
trial and commercial organisations progressed through a sequence of
challenge and response, which, for the most successful, led to innovations
in organisation, business strategy, leadership and management.

https://doi.org/10.1007/978-3-031-10654-5_2
32 P. Turner
Excellence was achieved by focus- on such strategic options as cost

leadership or differentiation- or by visionary leaders persuading others to
follow their charismatic style in pursuit of an exciting vision, or by inno-
vations in operational management, revolutionising production pro-
cesses. And now, a Fourth Industrial Revolution will, by both its scope,
velocity, and system impact once again change the competitive landscape
with radical alterations to the structure and functions of socio-economic
systems to cope with a complex, knowledge-based economy. It will pres-
ent opportunities such as lower barriers between inventors and markets;
a more active role for artificial intelligence and the integration of differ-
ent technics and domains (fusion). (Laursen & Foss, 2003; Ghislieri
et al., 2018; Xu et al., 2018; Turner, 2021) These dynamics will involve
the transformation of production, management, and governance.
Organisational competitiveness will depend on the ability to adapt to
these new circumstances as well as integrate new technologies across the
value chain from product design to sourcing of materials in the supply
chain to manufacture to marketing. However, it is not just concerned
with technology applications and as McKinsey (2022) note, the Fourth
Industrial Revolution will be people powered—‘Companies at the fore-
front of the technology frontier are empowering their workers with digi-
tal technologies—and the skills they need to use them.’
Pervasive machine automation applications, together with borderless
and dynamic environments will converge in almost every aspect of indus-
try and commerce, from smart factories using the new developments to
increase productivity and efficiency, to smart offices combining digital
systems to create new products and services. Undoubtedly, the consolida-
tion of technologies into ‘a new innovative ecosystem’ has created high
expectations. Its characteristics are the integration of the physical, digital,
and biological worlds through Cyber-Physical Systems which communi-
cate via the Internet of Things. They connect infrastructure, physical
objectives, humans, machines and processes ‘across organisational bound-
aries, enabling the fusion between physical and virtual world, exploiting
sensors, actuators, and computation power to transmit data in real-time
for decentralised decision-making processes.’ The Fourth Industrial
Revolution will be a continuous sequence that is likely to last for years or
even decades as the application of technological innovations continues to
grow, with the confluence of technologies forecast to reach its apogee in

around 2030. It has been described as ‘markedly different from its prede-
cessors’ (Schafer, 2018; Morgan, 2019; Díaz-Chao et al., 2021; Zheng
et al., 2021) because of a combination of integrated circuits on micro-
chips, memory units to store information, networks that help to enhance
communication, software applications that provide a direct link to con-
sumers’ needs and sensor capacity that allows artificial intelligence to
analyse most things which were previously only accessible to the human
mind. In business its impact will be the transformation of the frame-
works of production, management, and governance.
It will present opportunities to harness technology and extend the
range of human capability. Some of the impact and potential responses
are included in Fig. 2.1. The challenge is to ‘stay on the right side of his-
tory when the rules of engagement are changing so rapidly.’ (Johnson &
• A confluence of technologies
• Cloud Computing
• Artificial Intelligence
• Blockchain
• Mobile devices
Fourth Industrial • Internet of Things
Revolution • Digital Energy, Health, Transportation,Communications, Production
• Transformation of the frameworks of production, management, and governance

• Industry 4.0.
• Pervasive machine automation applications
• Smart and Collaborative Robots
Impact on • Cyber physical systems
Business and • Smart Worplaces
Commerce • Borderless commerce
• Progression multifaceted and connected

• Strategic progression on multiple fronts
• Organisation from hierarchy to ecosystem
• Leasership and Management competence and agile governance
Organisational • Workforce Progression- knowledge, skills, attitudes, and behaviours
Response • A holistic view of business- complementarities and synergies sought
Fig. 2.1 The Fourth Industrial Revolution—characteristics, impact and response

34 P. Turner
Markey, 2020; Peccarelli, 2020) These developments will benefit organ-

isations that are able to adapt and to integrate their operations through a
‘great reset’ or ‘great transformation.’ It is forecast that competitive advan-
tage will become more transitory thereby requiring organisations to adopt
radically new types of competitive strategy, from maintaining cost com-
petitiveness but also delivering customer service or attracting talent. For
some it will be an opportunity to inspire, and foster collaboration, a rein-
vention, a reshaping of how organisations operate with positive, comple-
mentary and synergistic experiences in intercultural management
interactions (Barmeyer & Mayer, 2020; BCG, 2020; Deloitte, 2020;
McKinsey, 2020)
Confluence of Technologies and Their

A
Applications—From the Analytical
to the Predictive
Inevitably, technologies underpin the Fourth Industrial Revolution and
Industry 4.0. where Industry 4.0 largely represents the ‘factory of the
future’, smart manufacturing technologies and the convergence of a wave
of innovative operational technologies with Internet-driven IT. (Martinelli
et al., 2019) The core themes will be the fusion of smart and intelligent
systems, automation, and digitalized production. These include the
cyber-physical—a collection of transformative technologies that con-
nects the operations of physical assets and computational capabilities and
often go hand in hand with the Internet of Things—a world-wide infor-
mation network of interconnected physical objects (sensors, machines,
cars, buildings, and other items) that enables the collection and exchange
of data, allowing interaction and cooperation of these objects; and based
on standard communication protocols. The decisions within these sys-
tems are informed by Big Data—the collection and analysis of large
amount of available data, processed in higher volumes, with higher veloc-
ities and in greater variety. The foundations for these activities are Cloud
Technology Systems which provide online storage services for all applica-
tions, programmes, and data within virtual servers- rather than locally or
on a personal computer.
Artificial Intelligence that ‘thinks’ in a rational way—includes machine

learning to recollect patterns and features directly from data leading to
actions based on algorithms—will drive both strategy and operations
with the disciplines of natural language processing, knowledge represen-
tation, automated reasoning, machine learning, computer vision and
robotics. Systems security will be enhanced by Blockchain which is a
database that creates a distributed and secure ‘digital ledger of transac-
tions, including timestamps of blocks maintained by every participating
node.’ A combination of these multiple systems will enable Augmented
and Virtual Reality applying technologies to create an interactive world as
well as extensive automation and industrial robots. (Zheng et al., 2021)
The connected things, automation, people and organisations are bound
by data and information interactions which operate on five dimensions—
connection, collection, computation, communications and co-creation.
(Bonamigo & Frech, 2020; Fakhar et al., 2021; Hamdan et al., 2021) The
breadth and depth of new technologies will form a ‘fertile layer’ of inno-
vation which will span most industrial and commercial organisation from
software development to industrial production to supply chain services.
Furthermore, technology is moving beyond the analytical to the pre-
dictive. Smart workplaces will see physical systems cooperating and com-
municating not only with each other but with humans in real time,
integrating systems horizontally—for example, from supplier to cus-
tomer- and vertically from the shop floor to enterprise resource planning
in smart factories or in smart service provision. To this latter point are the
incidence of such things as wearables to facilitate access, supplies or mes-
saging; work performance informed by real-time metrics and supported
by machine learning for root cause problem-solving of issues; monitoring
of equipment in real-time to predict faults and then allowing machines to
learn from their own mistakes and adjust their settings to improve quality
output. The power of combining these new technologies will enhance the
application of robotics, advanced materials, genetic modifications,
drones, neuro-technologies, autonomous vehicles, and machine vision.
(McKinsey, 2018; Skilton & Hovsepian, 2018) The outcomes will be
cost savings by improvements to supply chains; time savings from real-
time data; and new product developments by processing massive amounts
of data in product design and productivity gains.
36 P. Turner
New technologies will be ubiquitous; they will converge in unprece-

dented ways and combinations and their reach will be global. At organ-
isational level, the velocity and scope of change will have a massive
impact. Manufacturing, Professional Services, Wholesale and Retail,
Information and Communication, Financial Services, Construction and
HealthCare will all be affected. In this context, the potential of the Fourth
Industrial Revolution can be mapped across digital energy, which will use
digital technologies to manage the generation and distribution of energy
from traditional as well as renewable resources; digital health—digitisa-
tion will have a significant role in improving healthcare by comprehen-
sive monitoring of health status, better preventive care, more accurate
diagnosis and efficient delivery of treatment; digital transportation and
autonomous vehicles; digital communication—using sophisticated wire-
lessly connected smartphones; e-commerce web services and image and
voice recognition and chatbots; and digital production.
In its scale, scope, and complexity, it is ‘unlike anything humankind
has experienced before’ (Gilchrist, 2016; Schwab, 2016; Caruso, 2018;
Koh et al., 2019; Mazali, 2018; Marengo, 2019; Philbeck & Davis, 2019;
Accenture, 2019; King, 2020; Kipper et al., 2020) The Fourth Industrial
Revolution will take place in an environment of pace and unrelenting
change spanning both technology and human resources with the union
of physical systems and virtual systems. These transformations have
implications for competitiveness; the strategic choices organisations have
in how they respond to the new dynamics; requiring ‘human ingenuity of
the highest order.’
F ourth Industrial Revolution—Strategic

Discontinuity and Transformed
Business Models
The management challenges of the Fourth Industrial Revolution and
Industry 4.0. will be immense and will span both technology and human
resources in the context of significant social change and the union of
physical systems with virtual systems. Not only will organisations have to
deal with inherent strategic discontinuity forcing them to rethink their

own business models in fundamental ways, but also with significant dis-
ruption as Industry 4.0. technologies rapidly become dominant. Four
interpretations of this new environment are a Socio oriented approach
which addresses the impact on contemporary society; a Competence
approach which focuses on new skills; a Production approach reflecting
large scale automation and a Behaviouristic approach which deals with
the human impact of object- to- object interaction. Whatever perspective
is taken it is assumed that competitive advantage may no longer be as
durable as it once was. Instead, it may become transient. (Popkova et al.,
2019; Cagnetti et al., 2021; Lanteri, 2021) This conclusion, precipitated
by the confluence of technologies and their myriad applications as out-
lined above, means that organisations will have to adopt a new organisa-
tional logic, with different approaches to strategy, stewardship, and
governance, and create new structures of collaboration and high levels of
knowledge worker performance. Not only will these factors be strong and
powerful forces for change in the first instance, but they will also be criti-
cal to the sustainability of business strategy in the second. Organisations
will deal with the turbulence and volatility with faster and more frequent
strategic decisions and a rewrite of the rules of strategy. Furthermore,
there will be greater awareness of the social impact as demonstrated by
the Deloitte (2020) survey of C-suite executives where leaders were bal-
ancing the transition to Industry 4.0 by ‘capitalizing on advanced tech-
nologies to help propel their businesses forward while acting in more
socially responsible ways, particularly in the area of environmental
stewardship.’
Progression will be achieved in ways that are multifaceted and con-
nected and therefore the principle of fusion will be the key to innovation
and interconnected supply or value chains both within organisations and
across borders. It is in this context that complementarity will be an
important consideration. The potential for a ‘supply side miracle’ with
the transformation increasing productivity and ultimately changing the
competitiveness of companies and regions on the one hand will be
matched by an equally dramatic demand side revolution as customers
and clients amend their expectations for products and services and how
they are delivered. If the advantages of new technologies are to be realised,
38 P. Turner
though, systems will need to be integrated, enterprise wide, virtually, and

physically; with an extended ecosystem of business partners, and an effi-
cient responsiveness to change. In short, management excellence across
multiple fronts.
Organisational competitiveness will depend on the ability to integrate
new technologies along the value chain from product design to sourcing
of materials to manufacture to marketing. And having integrated them to
secure a favourable competitive position, the willingness and capability to
change if necessary. (McKinsey, 2015; Schwab, 2015; Rabeh et al., 2017;
Johannessen, 2019; Koh et al., 2019; Mazali, 2018; Reif, 2018; Skilton
& Hovsepian, 2018; Moueddene et al., 2019; Zunino et al., 2020;
Mathivathanan, 2021; Turner, 2021) In such an environment progres-
sion in organisations will depend on adapted business models and excel-
lence and agility in operational processes relating to how the business
model is implemented. For some, the challenge will be no less than rein-
venting the future of work which will require ideas and initiatives from
every quarter. It is likely that this reinvention will not be a single experi-
ence but one of continuous learning and hence continuous change. It is
for these reasons that the recommendation to ‘institutionalize’ ownership
of change is important in building an operating environment (structures,
people, culture) that is able to ‘collate and deploy useful data and drive
true collaboration.’ (Accenture, 2020)
Organisational Responses
to a Transformed Environment
The responses to these challenges and opportunities—agile governance
which is ‘adaptive, human-centred, inclusive and sustainable’—will apply
equally at to commercial organisations. (WEF, 2018) The context for this
agility will be in strategy, organisation, management competence and
workforce skills. And a holistic view of how each of these impact on
organisational performance because ‘the acceleration of innovation and
the velocity of disruption are hard to comprehend or anticipate …there
is clear evidence that the technologies that underpin the Fourth Industrial
Revolution are having a major impact on businesses.’ (Schwab, 2016)

The impact will be best addressed across the whole organisation rather
than in a single function or unit.
• Strategic progression on multiple fronts
To date, and within the many schools of strategy, it may be said that
there are two key approaches to setting and crafting business strategy:
which are the positioning and the resource-based points of view. In the
former, the strategic drivers are derived from establishing a focus on a
chosen industry or business that is either based on lowest cost of produc-
tion or differentiation. Having made this decision, the organisations
would seek a coherent approach in its activities along the value chain—
comprising of support activities such as HR or technology and primary
activities such as inbound logistics, operations, outbound logistics, mar-
keting and sales and service. (Porter, 1980 and 1985) In the latter, the
resource-based approach, organisations will focus their strategic attention
to cultivating ‘unique resources and capabilities to develop a durable
competitive advantage to best their competitors.’ However, the advent of
digital technologies and globalization with the emergence of different
competitive landscapes, means that ‘both positioning-based and resource-
based principles are increasingly perceived as insufficient to guide strate-
gic decisions and their tried-and-tested applications need to be
reconsidered.’ (Lanteri, 2021)
The approach to setting strategy and crafting its implementation will
therefore likely change. In the first place, there are indications of the need
for a strategy that goes beyond a single focus that has been the case in
other contexts. The multiplicity of technologies, their ubiquity and the
level of overlap require an approach that not only develops a functional
strategy—marketing, finance, HR- in support of a specific type of com-
petitive advantage, low cost or differentiation, but ones that are relevant
to a multiplicity of advantages and so will be cross functional, inter func-
tional and intra-functional. It may not be enough to define strategy in
terms of a single functionality or a single measure of effectiveness. Instead,
the emphasis will be on the ability to craft strategy across multiple fronts
and in ways that are complementary to each other- and back these up
40 P. Turner
with resources allocated with complementarity in mind. This means not

only the ability to define strategy in terms of hurdle rates or rates of
return for a single investment but of strategy as a series of interconnected
activities with varying degrees of individual impact- singularity—but
with greater degrees of impact collectively- complementarity. Strategy
and its associated methods of stewardship and policy setting will take
greater account of the benefits across the whole organisation rather than
one geography, business unit or department. It will go to the heart of how
organisations operate to the new requirements. Where this is successful
i.e. ‘understanding business strategy from the perspective of interdepen-
dencies’ can generate opportunities to be more productive, profitable,
and innovative than their competitors—as demonstrated by ‘Disney’s
ability to generate value for customers not only from producing block-
buster movies, such as Frozen, but also profit from related demand for
TV, music, and merchandizing, as well as theme park content in the wake
of such box office successes.’ (Yang, 2021) Strategy setting will be more
inclusive than when it was previously the domain of dedicated strategists
or the most senior of business managers.
New technology applications based on such factors as network integra-
tion, intelligent technology and flexible automation will generate new
competitive opportunities. To take advantage of them, ‘when developing
a strategic vision, it is important for companies to pick the relevant data
out of the information flow about the external and internal environment
and convert it into organisational knowledge, which is a core manage-
ment resource.’ Strategy setting will require analysis of the impact across
multiple domains—functional, structural and geographic; operational
decision making to be more collaborative and processes that take account
of the skills and contribution of a broader swathe of the workforce than
was previously the case. (Kolyasnikov & Kelchevskaya, 2020; Turner,
2021) There are benefits to so doing and research has shown that where
the technologies of Industry 4.0 are combined—in such areas as lean
production—then they can add extra value to customers; limits can be
exceeded with increased speed of information sharing leading to greater
competitiveness. In this respect a complementarity of strategy has the
potential to increase productivity and flexibility. The challenge facing
organisations is to identify and understand how precisely new
technologies can create advantage in their specific circumstances because

Industry 4.0 is a ‘digital container’ (Chiarini et al., 2020; Cagnetti et al.,
2021) filled with many different technologies, principles of application
and potentially multiple management systems. To maximise levels of per-
formance will require the organisation to understand the status of
resources at its disposal—their value or rarity compared with competi-
tors—and to ensure that these are deployed to maximum effect. (Barney,
1991) Progression through complementarity will have these principles at
its heart.
• Organisation from hierarchy to ecosystem
Organisational structures and practices are interdependent, and so

rather than a single best practice for organizing, ‘complementarities sug-
gest that the effectiveness of one organisational element may be depen-
dent on the presence or absence of another particular element.’ This
brings forward the importance of different types of configurations relat-
ing to fit, congruence, or synergies. (Jackson & Ni, 2013) If, as forecast,
there is ‘horizontal integration through value networks, end-to-end digi-
tal integration… across the entire value chain and vertical integration
and networked manufacturing systems’ then the traditional Weberian
type of hierarchy may not provide the most appropriate option for organ-
isation design. Horizontal integration facilitates collaboration for dis-
persed value chain partners by integrating their information and
communication systems and processes. Maximising the outputs of this
integration will be brought about by an organisation design or structure
that is geared towards the free flow of information and process. In a simi-
lar way, end-to-end digital integration allows cross-linking from raw
material procurement to manufacturing systems, to product sales and
marketing. Vertical integration involves networked systems that link
information flows from product development to manufacturing, pro-
curement and logistics and sales which are dependent on cross-functional
collaboration. (Sorooshian & Panigrahi, 2020)
By enabling a holistic approach towards an organisation’s management
processes because of the potential for systems integration, the Fourth
Industrial Revolution is necessitating a review of the structure and
42 P. Turner
process of organisation such that ‘ecosystems not companies are becom-

ing a new unit of competitive analysis.’ (Fatorachian & Kazemi, 2021;
Lanteri, 2021) In this scenario ecosystems are integrated networks of
separate entities that co-create value in which organisations operate as
nodes in a network. The impact of such structures will be across the whole
organisation and hence there is the need to build flexibility and respon-
siveness into structures, systems and processes, not only because of pos-
sible market volatility—which relates to both challenge and opportunity;
but also, the requirement of shorter product lifecycles, possible higher
product complexity, and the necessity to work within dynamic supply or
production chains. (Rabeh et al., 2017) The hierarchical structure which
has served well over the centuries may not always be the best way of
‘leveraging the internal technology ecosystem within the company’ or
indeed without.
New types of organisation will be less about silos of specialists but
more about dedicated project teams, focused on implementing and
exploiting technologies across the whole organisation, though these will
still adhere to strict protocols. Hence, the difference will not just be about
the many combinations of new technology but the management pro-
cesses and organisational constructs for working with them. There is the
potential to integrate manufacturing and services in new forms of busi-
ness model, creating ‘smart firms’ which not only deepen the integration
of technologies with both product design and development but also build
responsive production processes. Responsiveness will be facilitated by
new types of organisational structure. (Dean & Spoehr, 2018) In the
short term the organisational challenge will be one of transition to new
methods, systems, and processes, from legacy to new systems with impli-
cations for the transformation of the organisation’s business model. In the
longer term the challenge will be to sustain flexibility and responsiveness
within an agreed strategy or framework. The replacement of single source
technology with multiple technologies; and of singularity with comple-
mentarity does not mean replacing strategy and organisation with anar-
chy. Instead, it means a new outlook; one that encourages innovation and
diversity of method but does this within a framework of competence.
Four considerations will be important to organisation, which are the
structure of the working environment and the culture of decision
making; secondly the ability to integrate new systems either in their total-
ity or into a legacy of existing systems; third the necessity to consider the
social impact of the transformation and finally the impact on the work-
force of new business models, structures, systems and processes. (Turner,
2021) In this context, success will relate to capabilities on how the organ-
isation can harness and organise the skills of people, infrastructure, equip-
ment, or tools through appropriate organisation in order to achieve
certain objectives (Jacobs & Pretorius, 2020) Both management and
workforce competence are highly relevant in support of this point.
• Leadership and Management Competence and agile governance
Of course, the whole will comprise of interlocking parts, and these will
require a high level of management competence to ensure their effective-
ness. Leaders and Managers will continue to be responsible for innova-
tion outcomes (the ‘what’ and ‘what to do’), the innovation process (the
‘how’) as well as the corresponding determinants of innovation (the
‘why’). In addition, the complexity of human resources interfaces will
also require managers who ‘know how to behave.’ However a key attri-
bute of those who will lead and manage organisations will be responsive
decision making and a willingness to adapt rapidly, in short, agile gover-
nance in which business leaders instil a culture of learning to overcome
knowledge gaps between the old and the new. There are practical implica-
tions and successful adaptation will depend on leaders and managers who
are able to change their perspective from ‘problem-focused to solution-
orientated.’ Where leaders and managers embrace the potentialities of the
new technologies then these will be converted into actual organisational
advantages or benefits, but amongst the barriers to the implementation of
these technologies, ‘apart from the necessity to invest high financial
resources,’ are the low level of necessary support from the management of
enterprises. (Barmeyer & Mayer, 2020; Stachowicz et al., 2021; Turner,
2021) The necessity for change is reinforced by fast-changing competitive
landscapes which will:
force companies to reconfigure and redeploy assets and redesign both

internal and external structures to remain successful. Doing so requires
44 P. Turner
embracing strategic agility and cultivating a set of dynamic capabilities

which together consist of understanding change in turbulent ecosystems,
making strategic decisions to seize emerging opportunities, and effec-
tively transforming organizations to navigate VUCA environments.
While dynamic capabilities help organizations respond to change, it is
a truism that they are not and cannot be experienced at doing some-
thing new in changed contexts. (Lanteri, 2021)
The ability of the organisation to respond will depend on competences

of leaders and managers that are appropriate for the new environment.
Such competences will be particularly relevant during any transition
from legacy to new technologies but there are added dimensions. In par-
ticular it is the incidence of multiple technologies that will stretch the
boundaries. This is no longer about putting in an Enterprise- wide logis-
tics or HR system, but the probability of multiple new systems being put
in place simultaneously with frequent sometimes radical updates. The
second competence relates to the ability to manage in distributed or net-
work organisational forms and cultivate the culture within which such
organisations and their workforces can thrive. The new forms of organisa-
tion will require agility and adaptability on the part of the leaders and
managers. Their environment will be one of Cyber Physical Systems, and
intelligent and connected products each of which will be constructed
outside of the parameters of the rigid organisational chart and its empha-
sis on clear roles and responsibilities. Hence the capabilities in monitor-
ing, controlling and systems optimisation on the one hand; (Rosin et al.,
2020) but the creation of shared values on the other. Managing in the
new organisation will require the core competence of agile governance
creating business responsiveness and the ability to initiate a rapid response
in the face of uncertainty. But this will only be the case if managers are
able to use shared information effectively. In this respect managing inter-
nal and external collaborative networks will be one that underpins the
new ways of working. Building this environment will depend largely on
the ability to motivate and engage a diverse, collaborative, and empow-
ered workforce. The connectivity and complementarity of new organisa-
tions mean that ‘decisions in response to strategic or operational choices
will not be in the hands of a single decision maker but will entail greater
consensus from a greater number of people who have greater knowledge

and information on which to base their positions.’ (Turner, 2021) This is
indeed a radical departure from the hierarchical approach that has domi-
nated the organisational world for many decades.
• Workforce Progression—knowledge, skills, attitudes, and

behaviours
The introduction of new technologies in industrial work systems will

create sociotechnical challenges affecting overall system performance as
well as human well-being. This new environment will have implications
for the implementation of new human systems where at the centre of the
creation of technology solutions are ‘the aspirations, curiosity, creativity,
competence, and passion of the people who have imagined, prototyped,
and tested a technology’ hence recognition of the centrality of people in
organisational life. (Lee et al., 2018; Kadir & Broberg, 2021) The under-
standing of the extent to which technology acts as a complement or sub-
stitute is an area of debate. On the one hand technology can decrease the
value of work by performing substituting for humans, but on the other it
can increase the value of other work by making it more productive—the
complementarity effect. A positive take is that a characteristic of the new
organisations that emerge out of the maelstrom of revolution may be ‘a
curious workforce of builders and problem solvers …. in whole brain
thinking organizations; operations workers, technical or systems special-
ists, systems facilitators and work progressors.’ (NESTA, 2017; Accenture,
2019; WEF, 2019; Pedota & Piscitello, 2021) The success of any strategic
or operational initiatives that concern new technologies will benefit from
the momentum of employees whose tacit knowledge offers great poten-
tial. This buy in will be dependent on how effective the manager can be
at engaging the workforce affected by these developments though evi-
dence suggests that this will require significant effort. (Lee et al., 2018;
Ghislieri et al., 2018; Hahn, 2020; Schneider & Sting, 2020) For the
organisation to progress its workforce must too.
The impact of technology-enabled digital manufacturing or service
delivery will change both the nature of the workforce—knowledge skills
attitudes and behaviours—and how members of this workforce interact
46 P. Turner
in a rapidly and continuously changing operational environment.

Amongst the unique challenges in workforce management will be tech-
nology acceptance and uses of technology which are not only based on
knowledge of technology applications but also emotional attitudes (trust
towards technology, perceived threat) and the type of workplace-based
training in organisation. In addition, team identification is important for
the development of positive attitudes where humans and technologies
(such as robots) come together. There may be a growing incidence of
cross functional or self-managed teams where sharing knowledge and
experience defines the best way to reach goals, prioritize activities, and
focus its effort. (Ellis, 2018)
How to ensure a workforce, that has the right skills, in the right place,
at the right time will be high amongst the concerns and challenges of
managers. The digital revolution is also a human revolution—‘it is people
who will bring it to life in businesses’ and they will play a strategic role on
the one hand by determining the organisation’s strategy, be responsible
for implementing the strategy, and monitor progress against this and
where necessary intervening in ‘the cyber-physical production system.’
(Ghislieri et al., 2018; WEF, 2019; Porubčinová & Fidlerová, 2020.) The
preparation of a workforce is likely to bring with it reskilling, upskilling
and lifelong learning, an essential competence to prepare the workforce
for the new industrial paradigm. (Koh et al., 2019; WEF, 2019) The
forecasts about the impact of technology on the workplace cover a broad
spectrum—‘some fear a robot apocalypse that will eat up all jobs, leaving
mass unemployment in its wake. Others are techno optimists and see a
future where advancing technologies will create more new jobs than they
eliminate.’ Whatever scenario plays out the effect of future technology
innovation will be on how people work, the tasks that make up jobs and
how individuals and groups or teams combine tasks into work systems.
(Kochan, 2019) Industry 4.0. will have a far reaching and profound effect.
• A holistic view of business—complementarities and syner-

gies sought
There is an impending radical shift for employees, organisations, and

society as a whole. In this context ‘work and the meaning of work are
revolutionising as technology matures and organisations are driven by

digitalisation and smart ecosystems. This shift will require a balance
between technological innovation in the workplace with new jobs and
employment concepts.’ (Ross & Maynard, 2021) There has been some
precedence for this though perhaps not on the scale envisaged in future.
As organisations developed through the volatility that has been an inevi-
table feature of revolution, first owners and subsequently managers tried
to bring order to the way in which businesses were run. Organisational
hierarchies gave clear lines of responsibility, objective setting gave clear
accountability and functional specialisation created centres of excellence
in such areas as marketing and finance, technology, and HR. Formal
structures and the application of specialist skills were essential to deal
with the complexities of globalisation. Nevertheless, VUCA—volatility,
complexity, uncertainty and ambiguity, were never too far away and
organisations continued to adapt, using new forms—networks and
matrices, new approaches to strategy—crafting and collaborating, new
leadership and management competences and new approaches to both
talent (inclusivity) and workforce engagement (empowerment).
work and the meaning of work are revolutionising as technology matures

and organisations are driven by digitalisation and smart ecosystems.
This shift will require a balance between technological innovation in
the workplace with new jobs and employment concepts.
The advent of the Fourth Industrial Revolution will require organisa-

tions to continue along this path, responding to challenge in innovative
and dynamic ways. Some forecast an end to traditional strategy others see
an evolution in approach arguing that the seeds of change were set during
the period of technological advancement of the Third Industrial
Revolution. What most will agree on is that the new age will be one of
immense opportunity to those who are able to set up business models
that allow agility and dynamism whilst not losing sight of the overall
goal. A characteristic of this will be the need to view the ‘wholeness’ of the
business, one that favours a complementarity point of view. The implica-
tions are significant. In the first place, business strategy will be more
holistic, where functions or business units set strategy for a particular area
48 P. Turner
but increasingly include impact- opportunity- to apply their principles in

others. Here, the singularity of strategy setting is replaced by the comple-
mentarity of strategy setting. Secondly, leaders and managers will need to
be able to respond to transformation with agility and agile governance.
Third, the workforce will be active in seeking and disseminating their
knowledge of operations across functional or unit boundaries. And
finally, organisations will not be static entities but become fluid ecosys-
tems of internal and external partners.
The World Economic Forum speculated that the implications of the
Fourth Industrial Revolution would fundamentally alter the way we live,
work, and relate to each another. ‘We do not yet know just how it will
unfold, but one thing is clear: the response to it must be integrated and
comprehensive.’ (Schwab, 2016) The response from business organisa-
tions will increasingly be by taking a holistic perspective on all aspects of
organisational decision making. It will present some of the biggest chal-
lenges of all.
Progression—Organisational Knowledge,
Management Competence
and Complementarity
A multiplicity of forces is having a disruptive effect on the competitive
environment amongst which are globalisation, mass customisation and a
proliferation of technologies and their applications—notwithstanding a
global pandemic. Hence the ‘traditional’ business enterprise is facing
new, possibly unprecedented business challenges. ‘The demand for faster
delivery times, more efficient and automated processes, higher quality
and customised products are driving companies.’ The effect is one of the
transmutation of business structure. The competitiveness of organisa-
tions will depend on whether their value-creation systems are agile, effi-
cient, and adaptable. Where this is the case, and where organisations are
able to leverage their resources and unique or rare capabilities then there
is the potential for advantage and progression. For example, whilst both
lean manufacturing and factory digitalisation individually contribute to
improved operational performance, when used together, they have a

complementary (or synergistic) effect that is greater than their individual
effects combined. Identifying, modelling and implementing such combi-
nations will be a key aspect of the new environment. Where this is suc-
cessful then there is potential for both supply-side complementarities—an
organisation’s synergies from its resources and capabilities—and demand-
side synergies through customer complementarities An analysis of the
business models developed by Amazon.com for example identified how
customer complementarities—network effects and one-stop shop
effects—supported growth and competitive advantage. (Aversa et al.,
2021) Amazon Prime is an example of a business model where, customer
groups benefit from a large number of complementarities from one stop
shop and network effects.
The requirements for complementary resources that they are positively
correlated and that they produce synergistic effects on performance that
are greater than their individual effects combined. The Fourth Industrial
Revolution and Industry 4.0. provide the opportunity to ensure that
these resources are identified and their potential for performance improve-
ment realised. Having strategies that facilitate such an approach, leaders
and managers who have the competence to deliver it, a workforce that is
fully engaged with the process and an organisation structure that facili-
tates it will be key elements. In turn, these will require ‘timely and
dynamic adjustments in organisational and technology strategies to
ensure that an alignment is achieved and maintained between the organ-
isation’s capabilities and the changes impacting its value-creation require-
ments.’ (Jacobs & Pretorius, 2020; Mahmood & Mubarik, 2020; Buer
et al., 2021; Zheng et al., 2021) These powerful forces will affect the
entire value chain by simplifying manufacturing and engineering pro-
cesses, improving the quality of products and services, optimizing rela-
tionships between customers and organisations and providing new
business opportunities and economic benefits. (Kohnova et al., 2019;
Ślusarczyk et al., 2020) Bringing together the many and varied demands
will require organisations to pay more attention to the convergence of
various initiatives or strategies. ‘For the successful implementation of
innovations, a changed mindset and the communication of a clear strat-
egy in regard to those innovations among all parties involved is
50 P. Turner
necessary…. furthermore, the transformation needs to be considered as a

long-term process with cyclical, successive phases consisting of various
trials with an organisational nature which is inter-organisational and
cross-functional.’ (Preindl et al., 2020) The success in making the neces-
sary changes and innovations, will require the support of the whole
organisation and to cope with these unprecedented dynamics will require
organisational ambidexterity.
The objective will be to connect the physical and vertical worlds in the
quest for progression, seeking synergies along the way. (Bittencourt et al.,
2021) The transitory nature of future competitive advantage demands
the agility and responsiveness that are the feature of most commentaries
on organisational strategies for the future. But will adaptation be suffi-
cient or is the environment now pointing towards radical change. And so,
success during the Fourth Industrial Revolution will depend on ‘the
totality of its implementation.’ The new management paradigm will
therefore comprise of inter alia ‘comprehensive integration and informa-
tion transparency;’ increasing automation of production systems; self-
management and decision-making by objects; digital communication
and interactive management functions. In addition, the need to build
flexible workforce planning systems is paramount.
The implication of the new environment of the Fourth Industrial
Revolution is therefore related to new ways of strategy setting, business
operations and structures more open and inclusive models. Vlatka
Hlupic’s concept of a ‘management shift,’ seems relevant with the belief
that people have unlimited potential; that everyone is connected; that
they are looking for opportunities for continuous self-development and
personal growth or have a ‘can do anything’ attitude. In response, those
leading or managing the organisation will see challenge as opportunity,
are content to release control in favour of collaboration, and are commit-
ted to ‘emergent collective action.’ (Hlupic, 2014) The response to the
changed attitudes and behaviours of the workforce will be one of wide-
spread cooperation and collaboration, with high levels of trust and a
strong team culture. ‘Industry 4.0 is imposing a paradigm-shift towards
organisation structures and human roles and activities. The role of people
needs ‘to be placed in the centre as they are considered the leading com-
ponent for a given revolutionary shift.’ (Flores et al., 2020) The role of
the manager will be one of engagement, but the new context means that
this takes place in complex networks with a renewed focus based on
transparency, collaboration and inclusiveness.
Conclusion
The Fourth Industrial Revolution stimulates advances in science and
technology at an unprecedented pace, ‘in which the Internet of Things
and its supporting technologies serve as backbones for Cyber-Physical
Systems and smart machines are used as the promoters to optimize pro-
duction chains.’ It differs in speed, scale, complexity, and transformative
power and this advancement goes beyond both organisational and terri-
torial boundaries, requiring organisational agility, intelligence, and net-
working. (Liao et al., 2017; Xu et al., 2018) The new economic paradigm
envisaged by the confluence of technologies ‘makes the Internet (and
data) a way to create value for people and societies and not only serve as
a communication channel,’ it creates and environment which is more
digital, more connected, more flexible, and more responsive. ‘Well-
known social relationships are changing beyond recognition; we are mov-
ing from business-to-consumer relationships to peer-to-peer modes.’
(Morrar et al., 2017)
It offers opportunity to those organisations that are able to define to
where they want progression and how they are going to get there i.e.
alignment between objectives and strategy. Complementarity will have a
role to play in this process and evidence shows that there are innovational
complementarities between such aspects as the Internet of Things and
wider information and communications technology applications with
correlation between the efficacy of this relationship and economic growth.
The ‘introduction of complementary innovations’ will transform the
potential application of known techniques. Examples include ‘the intro-
duction of low energy consumption in sensors, and their declining costs,
are boosting their diffusion; advanced machine learning and deep learn-
ing are now beginning to drive automation; the introduction of cloud
connectivity is delivering low cost processing power and pervasive inter-
connection; and finally, new ways to connect monitoring and
52 P. Turner
management systems.’ Where these linkages are recognised and exploited,

there is the potential for such technology complementarity to have fur-
ther impacts on service complementarity. (Montes, 2016; Martinelli
et al., 2019; Edquist et al., 2021). How the organisation orchestrates its
assets to take advantage of such opportunity will be critical.
In so doing, new forces are at play and considerations will take into
account the possibilities that single issue competitive advantage may not
be the best course of action; that prosperity will not only come about by
pace and agility but by the ability to make sure that every investment cre-
ates advantage across the whole organisation and that these will in turn
create multiple competitive advantages. Strategic decisions about which
markets to serve are intertwined with tactical considerations about which
technologies will support those objectives. There are certain key steps that
organisations may wish to review as they make the transition. In the first
place there is the issue of the most senior leaders or managers up to Board
level. What competences do Board members need for example, what
should be the constitution of the Board, what new skills need to be
brought in. And then, having addressed this question, there is that of
readying the organisation from structure through to governance, from
competences to resource allocation. The key question is in regard to read-
iness at all levels. Amongst the considerations here is that of accessing the
talent needed for the new environment, which may not be just about
replacement but also about upskilling and most likely reskilling as
requirements change. And finally, the single issue that will define all of
these considerations is that of choosing the right strategy. (Endow, 2019)
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3
The Origins of Complementarity
omplementarity—From Quantum Physics

C
to Business Strategy
Complementarity has been a subject of interest for over a century.
Originating, simultaneously in both the scientific community—in par-
ticular, quantum physics—and across economic theory and practice,
there has been rigorous debate about its meaning and relevance. Latterly,
interest has spread to a diverse range of applications making it a poten-
tially useful construct as ‘a new epistemological framework’ for thinking.
The idea of complementarity has become one that was capable of wide
generalization since it could be applied to many examples of conjugate or
connected observables. In 1949 the editorial board of Dialectica, a quar-
terly journal of the philosophy of knowledge, stated that a proper under-
standing of this principle was the greatest single contribution of modern
physics to philosophy. Interest has gathered momentum in subsequent
decades. It has informed debate in international criminal law, American
political development, the nature of global trade, in studies of poverty, in
Darwinian evolutionary biology, from capitalism and sustainable devel-
opment to the complementarity of faith and philosophy.

https://doi.org/10.1007/978-3-031-10654-5_3
60 P. Turner
Why would this be the case?

The answer concerns the universality of its doctrine and potential
application. A concept that had multiple applications and could be used
to explain a variety of outcomes was in itself attractive. Furthermore, the
realms of a ‘concept,’ which Plotnitsky (2013) describes as a multi com-
ponent entity, can be defined by the specific organisation of its compo-
nents which may be general or particular in nature. But it is rare for a
concept to have only one component and as it acquires further features it
takes on a different hue. This is manifestly the case as the ‘concept’ of
complementarity evolved from its early roots. And so, whilst the search
for a sharper meaning of the term (as desired by Albert Einstein in his
critique of the work on complementarity by his colleague Nils Bohr,) was
a valid sphere of activity, it was inevitable that as the concept gathered
more elements, it would become germane to a wider range of
disciplines.
Each piece of research or evidence has added to its lustre and its grow-
ing use in explaining phenomena across disciplines. Complementarity
has been identified as a powerful tool in economics and business although
there remain several alternative notions of its definition and application.
(Topkiss, 1998) Understanding how it has evolved and the subsequent
attempts to define it may help in deciding which of these notions may be
a best fit for any particular organisation.
Complementarity—A Scientific Foundation

At the acclaimed ‘Solvay’ conference in 1927, two Nobel Prize winners—
Albert Einstein (Nobel Prize in Physics, 1921) and Niels Bohr (Nobel
Prize in Physics, 1922)—went head- to- head over their differences of
opinion on a field of quantum science—the nature of light. The essence
of the debate (which continued for many years afterwards) was based on
a contrast of two theories—wave and particle—which, when viewed sep-
arately seemed at odds with each other, but when taken together, appeared
to provide an answer to the question being considered. It was out of this
contradiction that Bohr concluded that the solution to many problems
could only be explained when viewing the ‘wholeness’ of a situation
where mutually exclusive events or characteristics come together in the

form of completeness. In Bohr’s interpretation this meant light acting as
both a wave and a particle, a point of view was the antithesis to one that
was purely mechanistic or objectivistic. It was argued that there are phe-
nomena which cannot be causally and unambiguously explained by tra-
ditional means. The profundity and universality of this powerful
assumption with the crucial ingredients of joint completion and mutual
exclusiveness—meant that it could be applied in a wide range of scientific
fields. (Bohr, 1957; Plotnitsky, 1994; Katsumori, 2011; Miller, 2012;
Home, 2013; Bala, 2017; Grygar, 2017; Shomar, 2020) The result was
more than a compromise or amalgamation of two differing viewpoints
but offered a ‘richer science’ in which aesthetic and quantitative valua-
tions, each retaining its own integrity, would contribute equally to the
explanation of natural phenomena. (Blackburn, 1971). This formed the
basis of the subject in its scientific context and the application of comple-
mentarity principles continued with the evolution of new sciences devel-
oped in the twentieth century, such as information, materials, or life
science. Interpretations were identified as cognitive, or disciplinary, insti-
tutional, and technical complementarity where ‘the former two are com-
monly found in the literature in reference to the complementarity
between scientific disciplines (inter-, multi-, or trans-disciplinarity) and
experimental facilities, respectively. The latter…refers to the need for sci-
entific institutions to interact and cooperate with non-scientific institu-
tions for purposes of scientific production.’ (Bonaccorsi, 2010) By 2021
the Scientific American was able to conclude that ‘Complementarity
alerts us that answering different kinds of questions can require radically
different approaches.’ (Wilczek, 2021)
Complementarity as it evolved in the area of science has adapted with
new forms and interpretations.
The essence, however, was related to both mutual exclusivity and com-
pletion and there was consistency for this in psychology where such con-
cepts as thought, and sentiment appear to be mutually exclusive but
together explain the nature of humanity. This principle is based on the
‘dualistic, dialectically contradictory essence’ of the phenomenon stud-
ied. A further interpretation is that opposites when taken together build
a complete picture—yin and yang. Again, using Bohr’s principle,
62 P. Turner
‘opposites are complementary’, i.e. that the unity of opposites is an indis-

pensable additional characteristic of the phenomenon of nature and soci-
ety which the researcher reaches as soon as he gets into their essence.’
(Afanasyev et al., 2015) This interpretation is perhaps best summarised
by the phrase ‘everyone knows what beauty is, because of the existence of
ugliness. Everyone knows what goodness is, because of the existence of
badness. Thus, what is beautiful and what is good can only be understood
because of ugliness and badness.’ (Bao et al., 2017)
However, whilst one psychological principle of complementarity is
based on mutual exclusivity, other interpretations were also be based on
similarity. For example, individual personality traits attract responses
from those with similar traits resulting in complementary actions; or
where the principle of multiple interests leads to a person’s desire to coop-
erate and complement. The construct of interpersonal complementarity
has been proposed ‘when a person’s demonstrated level of affiliation elic-
its similar (or correspondent) levels of affiliation from others, and when a
person’s demonstrated level of control/status elicits opposite (or recipro-
cal) levels of control/status from others.’ In this, a person’s behaviour
tends to ‘pull, elicit, invite, or evoke responses from relationship mem-
bers who are similar in affiliation.’ (Dryer & Horowitz, 1997; Fiske,
2000; Beluco et al., 2015; Borodina, 2015; Wang & Busemeyer, 2015;
Bao et al., 2017; Vishwanatha et al., 2021; Felton et al., 2021)
In the scientific domain therefore, complementarity can be based on
mutual exclusivity on the one hand or what might be termed mutual
inclusivity on the other. Two very different interpretations. Nevertheless,
both share a common assumption of the need to observe the wholeness
of a phenomenon for a better understanding.
Complementarity in Economics
In parallel, complementarity was of interest in the study of economics,
particularly in relation to demand theory—where economists debated
the need for a ‘good’ definition with the underlying descriptive notion
that complementarity occurs where two products are considered comple-
ments if having more of one product increases the marginal value derived
from having more of the other product. From the early years of the twen-
tieth century, this search attempted to build on the assumption within
the theory of supply and demand, by means of cross-price elasticity
‘which measures the responsiveness of demand for one good to a change
in the price of another good (ceteris paribus). Whilst significant progress
was made in search of this ‘good’ concept, there remained different inter-
pretations. (Topkiss, 1998; Lenfant, 2006; Puka & Jedrusik, 2021) As
economists debated, the number of definitions proliferated.
In macro-economics, complementarity was presented as a central con-
cept to comparative capitalism. Here, specific combinations or sets of
institutions and practices in economic activity were found to yield supe-
rior outcomes than the sum of their component parts. For policy makers
the challenge was to identify which practices worked together better than
others. For example, it was found in the relationship between social sec-
tor institutions and economic development. Furthermore, there was a
link between the circular economy-economic development in a sustain-
able way—and institutional economics where complementary arises
because ‘each tradition has strengths worthy of further attention by the
other.’ In the case of the circular economy, an important aspect is its
focus on resource use, whereas in the case of institutional economics, a
major facet is its attention to institutions. And when complementarity
was applied to link the relationships between the Internet of Things,
communications technology, and economic growth (total factor produc-
tivity) the results were positive and support the excitement that is being
generated by the prospects offered by the Fourth Industrial Revolution.
At the highest level of the economy, the concept has proven to be a useful
method of explaining the relationships that exist between a number of
influential factors. (Whalen & Whalen, 2018; Bilan et al., 2019; Darwish
et al., 2020; Edquist et al., 2021)
Other economic relationships have been informed by applying the
principle. On the one hand complementarity theory has been used to
examine the effects of foreign aid, foreign direct investment, and domes-
tic investment on economic growth with the conclusion that comple-
mentarity between these three forms of investment was a positive
influence and that aid, and foreign direct investment work as comple-
mentary factors to direct investment. On the other hand, financial
64 P. Turner
governance between regulatory institutions at global, regional and coun-

try level in ASEAN+3 countries found similar, complementary character-
istics, goals, and behavioural expectations. (Pardo & Rana, 2015; Tsaurai,
2018; Younsi et al., 2021) Once again, it has proven a relevant approach,
in these cases to the study of global fiscal policy and governance.
Teece’s (2018) contribution to understanding complementary in com-
mercial environments has been significant for over 30 years and his sum-
mary of the various interpretations identified:
• Hicksian (Production) Complementarity where factors of production

were complements when a decrease in the price of one factor led to an
increase in the quantity used of its complements in production.
• Edgeworth/Pareto (Consumer) Complementarity occurred if the util-
ity of consuming two goods together was greater than that of consum-
ing them in isolation.
• A third interpretation was that of Hirshleifer (Asset Price)
Complementarity which was a financial perspective about profit from
an innovation.
• Technological Complementarity which occurs ‘when the value of an
innovation depends on altering the nature of one or more existing
technologies and/or on creating new ones.’
• Innovational Complementarity was where improvements in a general-
purpose technology increased the productivity in downstream sectors.
‘For instance, the improvement of a cellular network opens new inno-
vation opportunities for firms providing wireless data devices.’
Puka and Jedrusik’s (2021) excellent summary, building on Berry

et al.’s (2021) valuable work presented a range of economic interpreta-
tions, some of which were:
• quantitative complementarity occurs when an increase in the quantity

of one good leads to an increase in the value of another. An example
cited was that of a right and left shoe
• qualitative complementarity is when an increase in the quality of one
good leads to an increase in the value of quality of another good. In
this case the example of a suit paired with a tie was used
• a third interpretation was that of ‘within a category complementarity’

where ‘a basket of goods within the same category is selected in such man-
ner as to best suit the customer’s current needs, e.g., a home film library.’
• This was contrasted with cross-category complementarity where goods
from different categories relate to each other to achieve a greater value
for the consumer, such as milk and cornflakes, or software and hardware.
• Provider-driven complementarity was where ‘independent goods
become complementary if they are delivered by the same provider (often
within a brand or series), e.g., banking services and brokerage services.’
Applications of complementarity lead to the conclusions in respect of

mutual exclusion and joint completion on the one hand, but similarity as
a source of complementarity on the other. This inherent contradiction
implies the point of view that complementarity may be a context specific
construct. The subsequent quest for clarity around its meaning and pur-
pose has led to a richness of debate with multiple definitions emerging in
both theory and practice—from the simplest explanation that sugar is a
complement to coffee, to complex explanations of the nature of wave and
particle theories. Indeed, and in spite of a debate which continues, it can
be argued that complementarity is just ‘a fact of scientific life, which,
once accepted…relieves the anguish caused by the emergence/reduction
debate.’ (Andler, 2006; Bonaccorsi, 2010; Brown, 2017)
Samuelson’s (1974) point of view in ‘Essay on The 40th Anniversary of
the Hicks-Allen Revolution in Demand Theory’ postulated that ‘the last
word has not yet been said on this ancient preoccupation.’ These words
echo those of Professor Lachmann who, writing in 1947, warned ‘this is
a field in which the wise walk warily.’ Many have walked warily in apply-
ing the concept to business and business management.
Complementarity in the Business

Environment—Theoretical Underpinnings
This is because a potentially important source of business progression
comes through complementarity. Its relevance and applications are per-
vasive subjects across business management, organisational theory and
66 P. Turner
economics covering such areas as responsiveness, game theory, scale econ-

omy, human resources management practices and external supplier/client
relationships in the overall ‘ecosystem’ with Teece’s (1986 and 2018)
analyses providing the foundation and impetus for further investigation.
If the logic of complementarity is applied to organisational performance
it implies that organisational success will come about not only by the
singularity of management actions—meaning discreet interventions,
decisions, or strategies in response to challenge or opportunity—but also
by complementarity—that is interventions that connect actions, practices,
tasks, resources, or assets to others and to a broader purpose or goal. It
recognises that complementary sets of business practices are able to yield
superior outcomes than the sum of their component parts. In manage-
ment literature complementarity among resources or among elements of
an organisation’s architecture has been used to predict outcomes which
include the sustainability of competitive advantage, rent appropriation,
superior innovation outcomes, the interdependence of organisation
design choices, reduced organisational change and alliance formation. It
is associated with the sustainability of competitive advantage, superior
innovation, and the interdependence of organisation design choices:
Complementary assets (vertical and lateral) in the digital context are

no longer just potential value-capture mechanisms (through asset price
appreciation or through preventing exposure to monopolistic bottleneck
pricing by others); they may well be needed simply for the technology to
function. Technological and innovational complementors present both
coordination and market design challenges to the innovator.
It can be described as emerging from the interaction of either homoge-

neous or heterogeneous units or elements, ‘when relations of independent
units or their evolution creates higher value than their individual opera-
tion.’ In this respect, two activities are complementary when the adoption
of one increases the marginal returns of the other and vice versa. It will
come about where different elements interact such as strategic choices,
business elements and means such as resources, partners, activities, cus-
tomers, distribution channels, and the cost/income structure. ‘The larger
number of the aforementioned elements interacts more intensively… the
higher the probability for the occurrence of complementarity.’ Hence it is
the result of choices regarding task networks, incentives, and job design.
It is not about whether an organisation implements a work practice but
rather how it is aligned with others. (Gao, 2004; Choi et al., 2006; Fedele
& Mantovani, 2008; Furlan et al., 2011; Baldwin, 2018; Kinderis, 2019)
It can be seen as the harmony of two or more parts as they integrate into
a whole. But how exactly this construct can be applied in business is one
that is open to discussion.
The first is that, as in most cases, where business models are conceptu-
alized through the value perspective—the value proposition, value cre-
ation and capture; or the opportunity perspective—opportunity
exploration and exploitation. Here, complementarities are regarded in
the context of competitive advantage or as market-related phenomena
through production complementarity, consumer complementarity, input
complementarity, asset price complementarity, technology complemen-
tarity or innovation complementarity. (Teece, 2018; Xu et al., 2020) The
second is that of resource complementarity which creates the potential
for synergy leading to long-term performance improvements and is ‘the
valuable, unique, and inimitable synergy that can be realized by integrat-
ing complementary resources provides an opportunity for the firm to
create competitive advantages that can be sustained for a period of time.’
(Harrison et al., 2001) Brynjolfsson and Milgrom (2013) noted that syn-
ergies occurred when two or more agents interreacted such that that their
combined effect was greater than the sum of their individual effects.
As an example, Teece argued that innovation could only be used to
generate profits, if it took place with complementary assets such as sales or
marketing or assets for coproduction. This was such a powerful require-
ment that ‘the ownership of complementary assets, particularly when they
are specialized and/or cospecialized, help establish who wins and who
loses from innovation.’ He argued that imitators could outperform inno-
vators if they were better positioned in respect to critical complementary
assets. In applying these concepts to the digital economy Teece (2018)
further argued that value-capture involves different challenges from those
in the industrial economy. In pursuing such arguments, the range of busi-
ness occurrences to which it has been applied includes multi-business
organisations, mergers and acquisitions, human resource systems, strate-
gic alliances and interorganisational relationships. (Soda & Furlotti, 2017)
68 P. Turner
Evidence points to the conclusion that complementarities are central

for the emergence of novel technologies and the ‘functioning’ of existing
ones. ‘Automobiles, for example, require a network of gas stations, a road
infrastructure, traffic and safety regulations, repair shops, specialized sup-
pliers and insurance services. Smart phones require a network of base—
and switching stations, interconnectors to landlines and the internet,
interoperability standards, different kinds of software, service providers
etc.’ (Markard & Hoffmann, 2016; Soda & Furlotti, 2017) Studies have
taken place in individual organisations as well as across whole industries
or communities of commercial organisations—such as the work of Mothe
et al. (2015) or Zhu (2004) which looked into complementarity in rela-
tion to innovation behaviour in Luxembourg; and organisations across
the US retail industry which found that the positive inter-action between
the IT infrastructure and e-commerce capability generated complemen-
tarities that contributed to improvements in performance through sales
per employee, inventory turnover and cost reduction.
Most recently—because of increasing co dependence and co-operation,
opportunity complementarity is an important antecedent of the business
model. Today, markets can be structured as ‘platform ecosystems, in
which a stable core (such as a smartphone operating system or a music-
streaming service) mediates the relationship between a wide range of
complements (such as software applications or music titles) and prospec-
tive end users.’ (Rietveld et al., 2019) Here, complementarity comes
about by the recognition that the chances of securing the benefits of a
business opportunity is improved by co creation and co capture in a col-
lective way. In all cases, it can be seen in business as what happens when
one management action complements that of another over time or space.
It means that specific sets of institutions and practices yield superior out-
comes than simply the sum of their component parts. (Darwish et al.,
2020) From the resource-based view, organisational resources and capa-
bilities, if managed effectively can provide an additional characteristic
over and above their intrinsic, ‘stand-alone’ value which is complemen-
tarity. ‘The complexity that arises from complementary resources and
capabilities makes a firm’s competitive advantage causally ambiguous and
sustains a firm’s competitive advantage.’ In this respect complementarity
may relate to assets that are generic, specialized or co-specialized, where
specialized assets ‘are those for which there is unilateral dependence

between the innovation and the complementary asset. Cospecialized
assets are those for which there is a bilateral dependency.’ (Baldwin, 2018;
Feizabadi et al., 2021)
Complementarity in the Business

Environment—Practical Examples
Complementarity in the business environment spans a multitude of
industries and sectors. When researching the concept of industry clusters
for example—geographic concentrations of interconnected organisa-
tions—it was found that the strength or degree of cluster complementar-
ity in a given urban area creates economic advantage for that area. And
where this is combined with investment in research and development
activities there is a knock- on effect—‘complementarity’ between it and
exports—engaging in R&D activities will increase the probability of
engaging in export activities. The impact was not just felt in large indus-
trial or commercial conglomerations and the interactions between small
and medium size enterprises backed by effective communications chan-
nels between individual companies fostered complementarity which
improved performance and facilitated adaptation capabilities to deal with
changes in the economic environment. (Neves et al., 2016; Xu et al.,
2017; Najda-Janoszka, 2018; Brave & Mattoon, 2020; Sánchez-García
et al., 2020; Torres & Augusto, 2020; Climent & Cakir, 2021).
In financial services, three levels of complementarity were demon-
strated between markets—the complementarity of expertise and infor-
mation, the complementarity of institutions and services and the
complementarity of market systems. The application of the ‘SOLOMO’
(social, location, mobile) concept, facilitates transactions in the emerging
sharing economy hubs by increasing the pool of potential service provid-
ers and sellers through networked technology. The effect is to change how
market participants engage in a specific transaction. Examples of comple-
mentarity industries—where skill complementarities are prevalent in the
workforce—are chemicals and rubber and plastics. The rise of the digital
70 P. Turner
economy has provided evidence on how companies like Google,

Facebook, Uber, Apple, Spotify, Airbnb, eBay, and Netflix have flour-
ished by scaling up and leveraging effective and complex relationships.
(Knox-Hayes, 2009; Chen et al., 2017; Stoyanov & Zubanov, 2019;
Aversa et al., 2020)
Resource complementarity in organisations creates the potential for
greater synergy. As outlined earlier integrating complementary resources
can give the organisation competitive advantages that can be sustained—
viz competitive progression. (Harrison et al., 2001) Furthermore, com-
plementarities between human capital and new technologies causes those
who have recognised and implemented policies tend to innovate first,
and complementarities among new technologies can create rising returns
to innovation and the incentive to adopt multiple technologies. (Yu et al.,
2011) The caveat on this assumption is that the existence of complemen-
tary resources is necessary but an insufficient condition by itself to achieve
synergy. Instead, the resources must be proactively integrated and man-
aged to realize the synergy—input complementarity.
There are numerous examples where the concept has been applied in a
business context.
• Of particular relevance to the context of the Fourth Industrial

Revolution is the potential of business value and profitability of
e-commerce and e-business by focusing on the exploration of comple-
mentary relationships between internet technologies and other ele-
ments within the organisation to see positive returns from investments
in these technologies. Data-driven business models such those used by
Amazon or Netflix offer complementarity opportunities by collecting,
organizing, and summarizing data, to identify unmet customer needs
and other opportunities in the market. Furthermore, while both enter-
prise resource planning and e-business technologies have positive
impacts on business value, the two IT resources together are comple-
mentary. ‘The existence of one resource enhances the value of the
other.’ Furthermore, the complementary effect based on how the two
are deployed could contribute more than the main effects of such tech-
nologies as stand alone. It is the complementary use of the two
resources to build system integration and business process coordina-
tion capabilities that is the key mechanism in creating greater business

value. (Hsu, 2013; Xu et al., 2020)
• There is complementarity between management control mechanisms,
when applied together the impact is greater than any isolated additive
effects—for example managing the positive relationship between
innovation, production, and service capability. (Zhang & Zhao, 2010;
Nielsen et al., 2018; Ndubisi et al., 2020; Darwish et al., 2020;
Moreno et al., 2020)
• Furthermore, internal collaboration and supplier operational capabili-
ties can act in a complementary way such that the ‘complementary
deployment of internal collaboration and external competencies
enhances each other’s contribution to innovation capability’ and so
organisations should consider making concerted efforts to develop
internal collaboration, supply network flexibility and supplier opera-
tional capability as a bundle.’ (Liao & Li, 2019)
• Intellectual property rights had a positive impact on performance,
especially in a ‘preferred specification,’ where having patent and trade-
mark rights had a complementary effect when performance was mea-
sured by profitability. (Grazzi et al., 2019)
• Amongst the means of implementing effective processes is the judi-
cious use of technology where the ‘right mix of technologies an enter-
prise should have to increase its value proposition and value creation’
is regarded as technological complementarity, which helps to improve
the quality of services and products, facilitates manufacturing pro-
cesses, and increases enterprise flexibility. For example, there is evi-
dence that complementarity between two forms of cross-domain
alignment—business strategy and IT- creates a positive effect on busi-
ness unit performance. Whilst technology itself won’t necessarily c reate
superiority or advantage, but that relative advantage can be created
and sustained where the technology leverages other critical resources.
It has positive effects on collaborative innovation leading to new prod-
ucts or services as well as additional or unexpected opportunities that
challenge traditional perspectives. Dynamic capabilities improve the
complementarity of IT and organisational resources and capabilities.
(Montes, 2016; Popa et al., 2016; Moreno et al., 2020; Queiroz et al.,
2020; Zhou et al., 2019)
72 P. Turner
• Research into SMEs found that those that were located in a region
with a strong pro-business environment and higher levels of market
development, open innovation brought more value than it did for
those located in regions with lower levels of those factors. There was a
strong complementary relationship between location and the inci-
dence of open innovation. (Chen et al., 2020) Innovation comple-
mentarity is enhanced in this case by geographic proximity and cultural
alignment.
• Service complementarity, where new services complement existing ser-
vices, increased the value proposition of the whole business, attracting
more customers, and increasing profitability. Complementarities have
been identified between Web services and business process manage-
ment technologies in ensuring greater utilisation and efficacy of the
organisation’s resources. This principle also applies in the relationship
between core and non-core products with a sizeable ‘and systematic
within-firm one-way complementarity between products that can
explain non-core product trade flows.’ (Padmanabhuni et al., 2004;
Montes, 2016; Arnarson, 2020).
• The concept has also been applied to other organisational functions
and constructs. Complementarity in marketing, for example, has been
used as a way of explaining and managing offline-to-online targeting
of customers. The argument being that ‘inducing offline customers to
buy online may complement a firm’s store channel. This is because as
more channels are used to engage customers, the value of these cus-
tomers increases, and multichannel shoppers are more loyal and spend
more than single-channel shoppers.’ (Luo et al., 2020) In addition
there are potential synergies between online and offline channels such
as showrooms in the store and allowing customers to buy-online and
pick-up-in-store, an arrangement which improves the shopping
experience.
• Internal collaboration (as a manifestation of exploitative learning) and
external competencies, including those along the supply chain such as
supply network flexibility and supplier operational capabilities com-
pensate for each other’s deficiencies. ‘Complementary deployment of
internal collaboration and external competencies enhances each other’s
contribution to innovation capability.’ (Ying & Yulong, 2018)
• Marketing research and a two-stage model of generating product

advice was used to test the principle ‘that the first-stage recommenda-
tions (personalized or non-personalized) influence the impact of dif-
ferent types of second-stage functionality, which augment the first
stage by facilitating either alternative-based or attribute-based process-
ing. Results show that the complementary synergies between the two
stages result in higher perceived decision quality, but at the expense of
higher perceived decision effort.’ A further analysis categorises com-
plementarities as complementarities-in-performance and
complementarities-in-use. The former approach tests the economic
value of combining different activities and practices whilst the latter
investigates the links between two sets of activities, suggesting that one
practice often requires other practice.
Research into specific industry sectors—from manufacturing to

Banking (Kuehn, 2020)—have also shown the occurrence of production,
innovation and consumer complementarity and its potential benefits,
although with variations between sectors. In tourism for example the
intensity of business model complementarity was manifested between
‘essential partnerships, value proposition, distribution/accessibility, con-
sumer segment and the analysis of resources and abilities.’ (Kinderis,
2019) In US manufacturing, the complementary effect between enter-
prise resource planning and e-business technologies in creating business
value was found to be stronger than the main effects of ERP or e-business
technologies alone. (Hsu, 2013) In the retail sector complementarities
achieved by effective supply chain cooperation was found to increase
profit to a level higher than where there was little or no cooperation and
hence complementarity between suppliers. (Liu et al., 2020) And in the
renewable energy sector there were complementarity effects and financial
benefits where organisations were part of a wider the generation portfo-
lio. (Camargo et al., 2013) A study of the Spanish service sector found
that it was possible to increase productivity if technological innovation
and non-technological innovation are implemented simultaneously—i.e.
a complementarity emerged from the two. (González-Blanco et al., 2019)
And research into the performance of Portuguese organisations found
that there was complementarity between R&D and exports, ‘which
74 P. Turner
means that engaging in R&D activities will increase the firm’s probability
of engaging in export activities. Additionally, engaging in export activi-
ties will also increase the probability of engaging in R&D. The results
also provide support for the hypothesis that more productive firms self-
select into exporting activities and also provide support for the learning-
by-exporting hypothesis.’ (Neves et al., 2016) In the energy sector, two
types of complementarity were identified—where it was the property of
one or more energy sources to complement each other’s production. In
the first- Space-complementarity was when the energy availabilities of
two or more types of sources complemented themselves within a certain
region. In the second- Time-complementarity existed when the energy
availability of two or more types of energy resources ‘present periods of
availability that are interlaced over time in the same region.’ (Beluco
et al., 2015)
Taken together, these diverse examples present a solid case for consid-
ering complementarity in a range of business domains and functions
across a range of sectors. The case is perhaps strengthened when consider-
ing responses to the new, challenging context of Industry 4.0. Is it possi-
ble that competitiveness will be enhanced if the elements of Strategy,
Leadership and Management, Talent and Engagement and Organisation
become mutually reinforcing? And if this is the case, how to make them
so is a critical organisational challenge.
Complementarity and Organisational

Performance—A Working Definition
Resources rarely stand alone in creating or sustaining competitive advan-
tage. Nor is advantage solely confined to tangible resources—evidence
from Japan shows that tangible and intangible capital are complementary
and indeed tangible investments are more strongly positively associated
with intangible investments as the degree of the complementarity between
the tangible and intangible assets becomes larger. This suggests that pro-
gression—competitive advantage in the short term and investment for
growth in the longer term—requires that organisations pay attention to
the totality of their strategies and the interdependence of their opera-

tions—organisational performance that is focused on alignment/
fit/congruence between strategy, structure, processes, and environment
and the effective deployment of resource in support of this congruence.
Complementarity is consistent with much of this thinking even though
theory has been a contested area of debate for decades. One interpreta-
tion concerns how mutually exclusive elements combine to form a greater
whole. Another is that complementarity means interdependence and
interrelationship of like elements. Where most would agree is that it goes
beyond ‘a simple interactive relationship between organisational charac-
teristics,’ in that a holistic approach has to be taken of the synergistic
interplay between the variables. It most generally involves benefits that
are derived from making joint decisions about multiple combinations of
goods and activities involving both synergy and a holistic perspective of
the system effects that occur when the whole is greater than the sum of its
parts. An example cited is that of offering financing in addition to the
production of durable goods with additional benefits (through customer
relationships) that go beyond those that would have accrued if either of
these services had been offered separately. ‘Overall, complementarity the-
ory explicates an organisation as an array of contextual factors, organisa-
tional structure and processes, and strategy within which all elements
reinforce each other to produce superior performance. This theory con-
tends that to understand firm performance, we need to adopt a holistic
view and understand how the relationships between elements can create
more value than the system’s individual components.’ (Parmigiani &
Mitchell, 2009; Woudstra et al., 2017; Arranz et al., 2019; Feizabadi
et al., 2021) In such an assumption progression does not arise from sin-
gularity but through reciprocity and complementarity, where such factors
as technological, product and process are determining factors to the per-
formance of one another. The above analysis shows a rich vein of research
and evidence of the benefits of complementarity in a business context. It
also shows that the many examples and case studies offer variations in
how the concept might be defined and applied although there is a com-
mon theme running through each. For the purposes of this book, a ‘dis-
tinctly pragmatic’ point of view has been taken and in this spirit a
definition is proposed that:
76 P. Turner
Complementarity is the interaction of business strategies and manage-

ment practices to produce coherent, aligned and mutually reinforcing
systems and processes that give superior outcomes (such as shareholder
value, profit, customer satisfaction, market share or cost reduction) over
those that would occur if such strategies or practices had taken place
independently of one another. It is where the complementary agency of
those strategies produces superior results, where the relations of inde-
pendent units or their evolution creates higher value than their indi-
vidual operation.
In this definition, organisational choices can be based on qualitative

and structural questions, from discrete alternatives in respect of combina-
tions or clusters of activity within the organisation (technology or human
resource practices for example) and in relation to the overall structure of
the organisation. Since the objective of complementarity is progression,
then it is important that a holistic view is taken so that specific elements,
that might otherwise stand alone in organisational activity are perceived
in their contribution to wholeness as well as the independent perfor-
mance of an area, business unit, or department. Hence the core tenets of
the complementarity hypothesis are:
• Progression will be achieved when there is complementarity between

business strategy, the organisation’s design or structure, how it is
stewarded or governed, and the policies enacted to deliver long term
direction and day to day activity.
• A primary assumption behind this principle is that the performance of
the whole organisation will be improved if there is complementarity
between elements of business strategy—for example between the tech-
nology strategy and the marketing strategy or the people or human
resources strategy. In this instance, complementarity means that any
strategy is not only developed for the benefit or progression of that
function but for the benefit or progression of the whole organisation.
Business strategy does not only relate to tangible asset allocation
because there is a ‘necessity to take into account the relation between
the dynamics of tangible and intangible capital in terms of their com-
plementarity for precisely understanding the mechanisms governing a
firm’s growth.’ (Hosono et al., 2020)
• A critical enabler of this and the performance of the whole organisation

will be complementarity between business strategy, leadership, man-
agement, talent and engagement; and an organisation that is designed
to promote interaction rather than singularity. The outcome of this will
be a culture of complementarity backed by systems and processes
designed specifically to recognise and address complementarity.
• Performance will be superior if the organisation’s strategy is comple-
mented by leadership, management, talent and workforce engagement
practices that are specifically incorporated into the processes for achiev-
ing such outcomes. In this scenario, strategy is not just a top-down
process, ‘the strategy is made; now we implement it. That’s unlikely to
work. A successful strategy execution process is seldom a one-way
trickle-down cascade of decisions.’(Vermeulen, 2017)
• The performance of leaders will improve if leadership competences are
complemented by management competences; the performance of
managers will improve if they complement traditional management
competences with those traditionally ascribed to leaders.
• Workforce engagement will improve if it is complemented by talent
management practice that addresses engagement issues; the perfor-
mance of talent management will be enhanced by talent aligned
engagement practices.
• The performance of the organisation will be improved when it mini-
mises singular interactions and maximises complementary interac-
tions. The organisation’s design and structure will be critical factors in
achieving this objective.
A feature of this approach is that the complementarity perspective

conceptualizes attributes explicitly as practices. Milgrom and Roberts
seminal work on the subject of complementarity concluded that it was
natural to expect the characteristics of the modern organisation to be
reflected in the way the organisation was managed and the way it struc-
tured its relations with customers employees and suppliers. ‘Exploiting
such an extensive system of complementarities requires coordinated
action between the traditionally separate functions of design engineering,
manufacturing and marketing.’ The complementarity perspective of this
point of view notes that complementary practices (i.e. practices that if
78 P. Turner
one of them increases, the marginal benefits of other practices also rise)
can be exploited in the creation of competitiveness. This goes beyond the
clustering of similar attributes and emphasizes that the complementary
association could stem from distinct traits. (Milgrom & Roberts, 1990;
Grandori & Furnari, 2008; Feizabadi et al., 2021) The challenge will be
to do so in the dynamic fast paced and unpredictable context of the
Fourth Industrial Revolution and Industry 4.0.
Conclusion
Traditionally the factors of production in any organisation affect each
other in one of three ways—these being firstly independent of each other;
secondly substitutive for each other, and thirdly complementary to each
other. Independence exists when a change in the level of one element
does not affect the value of another element; substitution occurs when an
increasing value of one element weakens the value of another; and com-
plementarity exists when a change in the level of one element increases
the impact of another element. It means synchronizing the organisational
factors to create a system which will produce superior performance. It
means creating a mutually reinforcing, interlinked system which will pro-
duce superior performance. It is characterised by different approaches to
strategy setting for competitiveness; new styles or competences for leaders
or managers with an emphasis on complementarity; agile organisation
structures and governance; open innovation, a sharing of knowledge, an
interest in obtaining new knowledge and an ease of assimilating new
knowledge. Complementarity is an important source of ‘path depen-
dence’ where successful change has to involve many variables in a system
and apply or combine them in specific ways. (Laursen & Foss, 2003) Of
equal importance will be the necessity to link talent and engagement
strategies firstly to each other and secondly to wider organisational
strategy.
With this in mind, the advent of the Fourth Industrial Revolution has
accentuated an aspect of organisational strategy which could be a signifi-
cant source of competitive advantage in a highly competitive market
environment. That is how to identify primary assets that are rare or
unique or difficult to replicate and how to deploy complementary assets

or resources either to support or to enhance their use. But what specifi-
cally should, organisations do to ensure they maximise the gains of com-
plementarity? What should be their approach to the setting and
implementation of business strategy; on what competences should the
attraction, recruitment and development of leaders and managers be
based and how should talent be managed against these; what can be done
to ensure that a workforce to deliver against the requirements of comple-
mentarity is engaged in so doing and finally what is the best way to struc-
ture the organisation against these requirements? Progression through
complementarity may well require organisations to adopt radically differ-
ent approaches or it may require adaptation rather than radical restruc-
ture. It is unlikely that there will be one best way to achieve
complementarity, Instead it is likely that best fit will be a more realistic
option. Either way, a greater understanding of strategy, leadership, man-
agement, talent, engagement, and organisational design will provide a
foundation on which such decisions can be made.
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4
Complementarity and Business Strategy
Coherence, Congruence and Consistency

As business organisations strive for progression, their direction will be
guided by an aspirational vision or mission but articulated in the form of
business objectives, business strategy and the stewardship and policy to
deliver them. These will include the allocation of complementary assets,
combined through the strategy setting process. Such assets may be tech-
nological know-how but also process or system capabilities or compe-
tence across the value chain. To be effective, strategy will require
coherence—an alignment between expectation and reality; congru-
ence—where elements of the strategy are integrated and reinforce each
other; and consistency—between intention and action. Contempora
neously it will take account of the merger of physical assets and advanced
digital technologies which will enable organisations to be more flexible
and responsive and make data-driven decisions in a fast moving and
unpredictable environment.
Such dynamics create the need for an approach that not only develops
a domain strategy for a specific business unit or function, but one that is
relevant across the whole. The enduring idea is that successful business

https://doi.org/10.1007/978-3-031-10654-5_4
88 P. Turner
strategies are able to exploit complementarities across management prac-

tices within an organisation. To achieve this requires utilizing large arrays
of interdependencies—strategic decision-making is conducted in an
environment of complexity and uncertainty. Where organisations such as
Disney or Amazon are successful, they are able to overcome these and
maximise complementarities across various business segments, thereby
creating better value for customers as well as superior returns for the com-
pany. The question that is raised in this consideration is which type of
strategy or business configuration is associated with high levels of perfor-
mance in a technology-based environment and what complementarities
underly it? (Cozzarin & Percival, 2006; Rumelt, 2011; Aversa et al.,
2015; Markard & Hoffmann, 2016; Deloitte, 2020; Yang, 2021). The
emphasis will be on the ability to develop strategy with multiple fronts—
with the ambition of super-modularity which occurs where an increase in
the performance of a single unit has the potential to increase the marginal
payoff of all other units—in ways that are complementary to each other.
And to back these up with assets and resources allocated where comple-
mentarity is the interaction of business strategies and management prac-
tices to produce coherent, aligned and mutually reinforcing systems and
processes that give superior outcomes (such as shareholder value, profit,
customer satisfaction, market share or cost reduction) over those that
would occur if such strategies or practices had taken place independently
of one another. It is where the complementary agency of those strategies
produces superior results, where the relations of independent units or
their evolution creates higher value than their individual operation.
In this context, the definition of strategy can be that which occurs at
corporate level, and which refers to the positioning of a portfolio of
organisations. Here, strategy will likely be concerned with directing busi-
ness units to attractive market segments in which, through detailed anal-
ysis, they are deemed to be competitive. The expected outcomes of these
units in the portfolio will range from cash through to market share.
Corporate interventions will be through portfolio management and own-
ership of a few common strands such as branding or talent management.
In another example, strategy can also refer to positioning and actions
within an individual business unit—a company or a firm—and will be
prepared with the specific objectives of that organisation in mind; an
example of which would be to increase market share. In this case comple-

mentarity will arise from such strategic activity as mergers and acquisi-
tions or alliances from which synergies through complementarity are
evident. For example, if an organisation with strong R and D capabilities
acquires one that is weaker in this area but strong in sales and marketing,
then the potential benefits to both—through combining their strengths
can be realised (Harrison et al., 2001). And finally, strategy can refer to a
function within a business unit—technology or human resources for
instance. In this case the strategy will be designed to enhance the perfor-
mance of that particular domain. Hence, the term strategy can be inter-
preted in a variety of ways with a variety of objectives. How strategy is set
is also open to interpretation.
The Evolution of Business Strategy Concepts

The increasing diversification of organisations at a time of globalisation
from the 1970’s and 1980’s brought with it increasing levels of invest-
ment. In return, investors demanded more insight and information about
how their money would be spent and when they would receive dividends.
It was from this milieu that more sophisticated models of strategy emerged
accompanied by corporate and portfolio planning derived from detailed
market analyses and forecasts. The new tools of strategy included SWOT,
PESTLE and Gap analysis or Balanced Scorecards against which invest-
ments in business units or functions could be monitored. Positioning
matrices such as those by Ansoff, GE and BCG underpinned a dominant
rationalist approach to strategic thinking based on scanning the environ-
ment for opportunity, methodical assessment of strengths and weaknesses
in this environment, a potential ‘position’ in a chosen market and the
formulation of strategy to achieve this. The goal was to shift the competi-
tive equilibrium and achieve competitive advantage. The work of Michael
Porter, with concepts such as five forces analysis, the value chain and the
theories of competitive strategy and competitive advantage, cemented the
rationalist approach. Porter argued that competitive advantage grew out
of the value a firm was able to create for its buyers that exceeded the firm’s
cost of creating it. It was influenced by the choice of competitive scope
90 P. Turner
and the range of a firm’s activities (Porter, 1980, 1985). In this way, the
maximisation of shareholder value—a common objective—would be
achieved by the clarity of both objectives and a well thought out strategy
backed by detailed and specific plans.
However, there were those who argued that the dynamism and unpre-
dictability of world markets required more than formal structured matri-
ces. The concept of VUCA—volatility, unpredictability, complexity, and
ambiguity—came as a reality check. Alternative ideas emerged, with ten
distinct ‘schools’ of strategy including the design school, the planning
school, the positioning school, the entrepreneurial school, the learning
school, the cognitive school, the environmental school, and the configu-
ration school (Ahlstrad et al., 1998). Many approaches were prescriptive,
with models of how strategy should be formulated; others were concerned
with positioning. And as an antithesis to the positioning approach came
a resource-based view which sought the exploitation of core competences
based on four ‘empirical indicators’—value, rareness, imitability and sub-
stitutability—inside out rather than outside in. Here was a link between
an organisation’s internal characteristics and performance where its
resources and capabilities were at the heart of value-creating potential. In
this, sustainable competitive advantage stemmed from resources and
capabilities that were valuable, rare, and difficult to imitate or substitute.
In the resource-based view, valuable resources are valuable because of
their contribution to enablement—conceiving and delivering strategy.
They are important in facilitating the exploitation of opportunity or
the neutralisation of threat. If these resources are rare—the second aspect
of the resource-based view—in that they are possessed by few in a particu-
lar market or sector, then these will provide additional sources of sustain-
ability from a strategic perspective. The third aspect is whether the
resources are ‘imperfectly imitable.’ This means that organisations which
do not have the resources cannot obtain them—because of unique histori-
cal conditions. The social complexity of resources is also a potential source
of advantage including interpersonal relations among managers, an organ-
isation’s culture, or its relationship with either suppliers or customers.
Finally, substitutability, means that there are no similar or substitutable
resources that can be utilised by a competing organisation. The resource-
based view advocates that these sources of advantage are recognised and
utilised. Complementarity can build on this assumption in the process of

strategy setting (Barney, 1991; Schweiger et al., 2019). Almost regardless
of the point of view—internal resources or external analysis—Henry
Mintzberg wrote of the concept of emergent strategy (1978, 1987, 2011)
that emphasised strategic agility and responsiveness to unanticipated
events, resulting in a crafted, as opposed to pre-formed strategy.
The concepts of business strategy, its schools, its language, and its sys-
tems have been present in organisational life for decades and the prepara-
tion of the familiar five-year plans—later displaced by three-year
plans—with the first year as the budget, have been a feature of the role of
managers at all levels. But, more recently, and as the Fourth Industrial
Revolution gathers momentum, the scale and velocity of change in the
global economy is creating new challenges and causing reflection about
how to make business strategy work in the radically different context. The
political upheaval caused by the events of the second decade of the
twenty-first century added significantly to this new context. Whilst a
confluence of new technologies offers significant opportunities, business
managers will face an environment that will be unlike anything that has
gone before, in which conventional models of strategy may well be trans-
formed. For some, ‘a VUCA world is a shift in kind rather than degree.
Tried and tested approaches cannot be simply updated, they should be
altogether replaced. Fast-changing competitive landscapes force compa-
nies to reconfigure and redeploy assets and redesign both internal and
external structures to remain successful’ (Lanteri, 2021). In all cases, the
challenge for leaders and managers is to achieve their desired outcomes
by ensuring that the energy created in the strategy setting process, and the
subsequent resource allocation, become positive forces that benefit the
whole organisation.
usiness Progression and Cross

B
Functional Synergies
The dynamics of the Fourth Industrial Revolution will create significant
new opportunities but also new complexities because of few precedents as
to the best practice approach to strategy formulation to take advantage of
92 P. Turner
them. For example, scholars have found positive results not only from
conventional approaches but from hybrid or combination strategies
where low cost and differentiation strategies are complementary rather
than mutually exclusive. As outlined earlier, this reflects the principle that
the outcomes of singular initiatives—such as functional strategies—will
be improved where they take account of the potential synergistic oppor-
tunities with other initiatives. It reinforces the congruence element of
successful strategy. Complementarity theory means that the elements of
structure, process, and strategy in one area reinforce others to produce
superior performance over and above the total of individual strategies.
The theory advocates that organisations adopt a holistic view to help
them understand ‘how the relationships between elements can create
more value than the system’s individual components.’ A recent analysis of
the business models used by Amazon for example, noted that customer
complementarities—network effects and one-stop shop effects—sup-
ported growth and the achievement of competitive advantage. Significant
complementarities in a rapidly changing environment provide a strong
reason for close coordination between units, departments, or business
functions.
Further examples occur in the rationale during acquisitions where a
base assumption is that ‘acquired knowledge and technology should be
complementary to the acquirer’s knowledge base because such a combi-
nation leads to a surplus over and above the value the acquirer’s and tar-
get’s resources could create independently.’ However, this will be context
specific, and so the ways in which organisations achieve these desirable
outcomes will depend on the adaptation of their own unique experiences
to the markets in which they choose to operate (Milgrom & Roberts,
1990; Cassiman & Veugelers, 2006; Rumelt, 2011; Jackson & Ni, 2013;
Grimpe & Hussinger, 2014; Woudstra et al., 2017; Arranz et al., 2019;
Haefliger et al. Haefliger & Hueller, 2020; Feizabadi et al., 2021). The
questions facing organisations is how can strategy be set in this unpre-
dictable environment and how can complementarity create additional
value from it; which strategies and practices work together better
than others?
In whatever way value is created, whether through cost leadership, dif-
ferentiation, or by the maximisation of performance from internal
resources, the ability to make sure that investments are mutually reinforc-
ing and create advantage across the whole organisation is an important
aspect of strategy. Whilst accepting that the process has evolved from
being ‘less of a mould into which corporate ingredients could be poured
and a fully formed figure emerging, to more like clay on a turntable,
fashioned and crafted into shape,’ complementarity presents additional
opportunities. Competitive progression in this way strives to maximise
the value that can be created over and above what would be the case if
those strategies were implemented singularly. Extracting the benefits of
cross functional synergies becomes desirable.
There are some important assumptions behind this point of view.
• In the first place, the confluence of technologies envisaged in the

immediate future and the potential for interlinking systems turns the
potential of complementarity into reality. But how to do so is likely to
require additional way points in the strategy setting process. In these
instances, strategy is not only developed for the benefit or progression
of a particular domain, but—explicitly—for the benefit or progression
of the whole organisation. Return on investment will include the
returns anticipated from other areas outside of the unit, department,
or function where that investment was made. Securing this return will
require revised systems of strategy development, approval, evaluation,
and measurement.
• This approach is not necessarily a schism from the past and business
strategy will continue to include the steps to create and appropriate
economic value from whichever markets an organisation chooses to
compete. There is no definitive way of developing these strategies and
the alternatives range from the rational or analytical approach to deter-
mine strategic positioning or the emergent approach to strategy as a
pattern that emerges from the stream of decisions dependent upon the
context within which those decisions were made; or the resource-based
view—the resources which an organisation has at its disposal and how
they are orchestrated. Whatever the basis, there is consensus that busi-
ness strategy is intended to create a strong competitive position from a
range of alternatives. However, and for the purposes of this study, an
adaptation of the many and varied definitions of strategy may be that
94 P. Turner
complementarity is concerned with achieving competitive progression

through the deployment of resources to deliver objectives in ways that
bring advantage across the whole organisation, and the coordination
of strategies, policies and actions in ways that deliver value over and
above the value of singular strategies, policies, and actions. This implies
that unit or functional strategies have an additional element in that
their objective will be consideration of additional value from their
impact on other areas.
• In the same way that a single domain or functional strategy does not
stand alone in this environment, neither does the process of strategy
setting. Instead, competitive progression will be achieved when there
is complementarity between business strategy, the organisation’s
design, or structure, how it is stewarded or governed, and the policies
enacted to deliver long term direction and day to day activity. Strategy
setting will be more inclusive and whilst it may be guided by domain
specialists, will take input from the tacit and explicit knowledge of a
wider number of members of the workforce. Utilising knowledge in
support of complementarity becomes a core competence. This means
the effective integration of technologies, specialised knowledge, skills,
techniques, and experiences in a way that delivers differentiated advan-
tage over and above that which would apply should such technologies
and knowledge be applied singularly. It is a ‘company’s collective
knowledge about how to coordinate diverse production skills and
technologies,’ or ‘a harmonized combination of multiple resources and
skills that distinguish a firm in the marketplace.’ Knowledge will
become one of the most important resources and harnessing it is both
a feature of core competence and a means of developing it (Turner,
2021). The appendices of traditional strategy—organisation design,
process engineering, policy and stewardship, and people management
now become integral.
• In support of competitive progression will be an organisation structure
in which complementarity value can be recognised; a culture that both
supports and facilitates its delivery; systems and processes designed
specifically to ensure its smooth implementation; leaders and manag-
ers, who recognise the potential and are prepared to work collabora-
tively; and a workforce fully engaged with its broad-based objectives.
Hence strategy setting in pursuit of competitive progression will con-

tinue to be about making choices. But these choices have an additional
consideration. Do they add value, over and above their specific ROI, to
other parts of the organisation which when taken together create more
value than the singular investment or strategy? Support of this process
will come about once there is recognition of the place of complementar-
ity in strategy setting, the knowledge, skills, attitudes, and behaviours at
all levels of the organisation to acknowledge that structures, systems, and
processes will need to be in place for its delivery and finally, the creation
of methods to capture and report benefits.
omplementarity in Strategy Setting

C
and Strategic Choice
An organisation will make decisions relating to both its scope of business
activities and the strategies it intends to deploy in pursuit of its own pro-
gression. Exploiting valuable or rare resources, deciding on the target
market position, or seeking cost advantage or differentiation are possibili-
ties. However, there is also a scenario that such combinations will be
serendipitous. In the case of the former, integrated strategic processes will
be necessary. In the case of the latter, the organisation will depend on
strategic agility and agile governance. Adopting complementarity prin-
ciples in this process provide a further potential source of advantage. An
example of this in practice is in respect of the business value of technol-
ogy applications, where it’s important to consider their effects on a broad
range of business capabilities (i.e., logistics, customer service, marketing,
and analytics) that ultimately enhance firm performance rather than in a
singular or independent way. On the assumption that ‘resources can be
orchestrated into configurations with unique performance characteristics’
(Denrell et al., 2003; Suoniemi et al., 2020), identifying how this will
occur and crafting strategy to facilitate its incidence can therefore be an
important determinant of progression.
There are five areas of enhancing the potential of complementarity in
strategy setting discussed below and shown in Fig. 4.1:
96 P. Turner
●Cross-domain
alignment and
coordination of
functional
●Asset strategies
orchestration by ●Integrating
combining strategic
advantageous processes
resources
Complementarity Measuring the

●Exploiting social
and business outputs of
complexity strategy complementarity
Fig. 4.1 Complementarity and business strategy five areas of potential
• Cross-domain alignment and coordination of functional strategies
Alignment has been a watchword in strategic theory as an essential

precursor to congruence, coherence, and consistency. It is part of the
‘kernel’ of good strategy and constitutes coherent action behind a set of
agreed goals. But it can often present a challenge since its achievability
will most likely be conditional on contextual variables. For example,
alignment may be made more difficult because of situations in which the
organisation’s leaders and managers divide rather than combine their
attention on various aspects of strategy—a singular approach. Managerial
objectives focused on a specific unit, department or function may not, for
example, include a broader organisation wide brief. And internal politics,
referred to euphemistically as organisational dynamics, may hinder con-
certed action. In other cases, leaders or managers may be inhibited in
their collaborations with other functional strategy owners—rigid organ-
isation design or an inflexible culture are possible causes. Internal factors
are as diverse as geography and physical location or organisational cul-
ture—a silo mentality for example—which may inhibit the achievability
of alignment; whilst external factors such as the strength of competition
can be unpredictable or volatile and add to the difficulty of making deci-

sions in favour of complementarity (Barney, 1991; Cassiman & Veugelers,
2006). To break with such inhibitions therefore, a strong case will need
to be made for the benefits of seeking complementarities.
The foundation of this case is recognition that the performance of a
function can be significantly influenced by complementary forms of
cross-domain alignment, and organisational performance can be influ-
enced by complementarities between strategic efforts in domain or func-
tion and organisational goals. Hence, while there are benefits from
singular strategic orientations. a combination of strategies ‘create syner-
gies that surpass the effects of individual strategic orientations. Therefore,
to achieve superior performance, firms need to align their strategy mak-
ing efforts’ (Schweiger et al., 2019; Queiroz et al., 2020). There are some
useful examples which support the argument for alignment. Firstly, tech-
nology complementarity has positive outcomes where there is alignment
between the corporate or business unit IT platform and their business
strategies. In these examples there is a complementary effect between
enterprise-wide resource planning and technologies in creating business
value that was stronger than the effects of these alone. Cross domain
alignment will depend on managers finding collaborative partners and
establishing collaborative relationships. The strategy setting process has
the potential as a catalyst for such activities since a ‘combination’ strategy
can provide a distinct advantage in both product and process innova-
tions. In these and other cases, technology-enhancing combinations
proved to add strategic value as well as increasing productive capacity in
two ways—first through the combination’s direct and independent
impact on productivity; second through additional increases in produc-
tivity generated by the joint implementation of the combinations
(Marcela et al., 2016; Gonzalez-Blanco et al., 2019; Zhou et al., 2019;
Wang et al., 2021).
But it isn’t just in relation to the deployment of IT resources. Ground-
breaking work on complementarity in respect of human capital and
human capital resources demonstrated the benefits of aligning such
resources with others (Ployhart et al., 2014; Wolfson & Mathieu, 2018;
Wolfson & Mathieu, 2021). In the former, an individual’s knowledge,
skills, abilities, and other characteristics (competences) are important for
98 P. Turner
achieving economic outcomes, whilst the latter are individual- or unit-

level capacities that are accessible for unit-relevant purposes. Hence,
although human capital can be described as accumulated employee com-
petence for them to yield human capital resources ‘they need to be inte-
grated and be potentially valuable for unit-relevant purposes.’ There was
a potential performance effect to be gained from aligning ‘not only indi-
vidual competencies with changing characteristics of performance epi-
sodes, but also with team-level competencies’ (Ployhart et al., 2014;
Wolfson & Mathieu, 2021). Where a team is assembled, with the prin-
ciple of complementarity in mind, and informed by the benefits of cross
domain knowledge exchange, then there is the potential to deliver
improvement over and above the total of individual performance.
Cross domain alignment has significant potential for delivering the
benefits of complementarity. However, these are not automatic and will
therefore require a form of strategic planning to be coordinated with the
objective of competitive progression or sustained competitive advantage.
This will include identifying domains that have valuable or rare resources,
and extrapolating areas that, when combined will provide a source of
potential over and above their individual value or return. The point of
view is the recognition that by combining resources in a way that adds
value over and above the value that those resources would generate inde-
pendently, is a potential source of progression.
The question is how to convert this potential into reality.
The objective of strategic alignment is to ensure that all elements of
strategy support the organisation’s objectives. Cross domain alignment
adds a further criterion with the question of ‘do the elements of business
strategy support each other in delivering the organisation’s objectives?’
Setting business strategy to achieve complementarity therefore adds to
what may be called vertical alignment—from the base to the overarching
goal or purpose—with horizontal alignment—each domain is aligned
with the other. Hence, the first requirement is to ensure a strategy setting
process that is not only focused on the development and preparation of
singular strategies for particular domains or functions but also includes
the coordination of strategies, policies, and actions to identify value over
and above the value of singular strategies, policies, and actions. Each ele-
ment of strategy will be brought together with the explicit intent of
identifying complementarity value. The strategy setting process will allow

for the exploration of combinations of individual strategies or investments.
To do so will require the incorporation of tacit or specialised knowl-
edge, skills, techniques, and experiences to identify ways to deliver advan-
tage over and above that which would apply should such knowledge be
applied to a single domain. In this way, tacit knowledge becomes explicit
knowledge enhancing the opportunity for complementarity benefits.
Cross domain alignment will allow not only a post development review
of other domain strategies but pre-development input into the creation
of strategy. Thirdly, the process of seeking cross domain alignment will
include considerations about the fit of the strategy with the organisation
structure, requiring adaptation to maximise additional benefits of and
minimize the potential blockages in their attainment.
Part of the process of alignment will be resource allocation that
enhances the possibility of achieving complementarity.
• Asset orchestration by combining advantageous resources
If it is the ‘bundle’ of unique resources possessed by an organisation

that may enable it to gain and sustain competitive advantage, then it is
how those resources are orchestrated—that is set up, organised and man-
aged—that will convert potential to meaningful outputs. It is how those
resources are applied in the creation and delivery of strategy, how they are
orchestrated to the right place, at the right time, that is critical. It is the
combinations—rather than net levels—of resources that will achieve
resource complementarity (Harrison et al., 2001). The challenge is to
ensure that the resources, when interacting, provide over and above what
they would when considered individually. This means ‘orchestration’ in
terms of breadth—across the scope of the organisation; life cycle—at
various stages of the organisation’s maturity, and depth—at multiple lev-
els. Resource allocation represents a dynamic renewal of resources, rou-
tines, and capabilities; going beyond the direct effects of individual
resources and ‘uncovering different resource configurations that maxi-
mize profitability’ (Sirmon et al., 2011; Hughes et al., 2018).
To use the words of Nils Bohr: (1929)
100 P. Turner
as our knowledge becomes wider, we must always be prepared therefore to expect

alterations in the points of view best suited for the ordering of our experience.
Hence the creation and dissemination of knowledge, combined with

an emphasis on collaboration will ensure that both are applied in an opti-
mal way and will inform the deployment of resources and assets. The
objective is to maximise the use of tacit knowledge to facilitate comple-
mentarity and convert this tacit into explicit knowledge to maximise its
benefits. The use of knowledge and technology resources in building sys-
tem and business integration capabilities will lead to the most comple-
mentarity value because such value depends on the interaction of a whole
system and the organisation’s dynamic capabilities (Cao et al., 2011; Hsu,
2013; Ho et al., 2016; Moreno et al., 2020). It is a quest for mutualistic
symbiotic relationships—where symbiosis—the complementarity of
strategic assets—is important for the generation and capture of the value
of such things as innovation projects. The challenge is how to orchestrate
valuable and rare assets or resources in a way that they are complementary
to each other. In this respect the four principles of accessing, integrating,
developing, and releasing are important, where accessing and releasing
are based on inter-unit relationships, whilst integrating and developing
focus on intra-unit processes (Cassiman & Veugelers, 2006; Monteiro
et al., 2020; Queiroz et al., 2020; Suoniemi et al., 2020).
The strategy setting process provides ways to deliver these anticipated
positive outcomes.
In the first place, those involved in strategy development will have a
key part of their objectives consciously to identify and seek cross func-
tional synergies—because resource complementarity is not given but
jointly constructed in interactions with multiple potential partners
through recursive cycles referred to as prospective resourcing (Deken
et al., 2018). Secondly, the process will benefit from modelling combina-
tions of assets and resources to determine how the relationships between
elements can create more value than the system’s individual components.
And thirdly, there will once again be a ‘complementarity consciousness’
in the commitment to the deployment of resources to deliver objectives
in ways that bring advantage across the whole organisation. This will
involve trade-offs as decisions favour one type of investment over another.
The buy in of the organisation’s leaders and managers to this will deter-
mine how much these trade-offs contribute to competitive progression.
Whilst the intent to explore cross domain complementarities and
orchestrate assets accordingly is a positive move towards competitive pro-
gression, it will be converted to benefits by practical and explicit strategy
setting processes. Amongst the requirements will be the goal of integra-
tion whereby an organisation’s ‘systemic capability to align its core strate-
gic processes creates super-additive performance effects that exceed the
sum of the marginal effects of adopting each orientation separately’
(Schweiger et al., 2019). The ability to deliver the potential of the organ-
isation through progression will be enhanced where strategy formulation
and implementation are integrated such that the three elements of suc-
cessful strategy-coherence, congruence and consistency are achieved.
• Integrating strategic processes
Integrating strategic processes is essential if the benefits of complemen-

tarity are to be realised. In the dynamic environment that is envisaged as
the Fourth Industrial Revolution gathers momentum, strategic manage-
ment will not only pay attention to market positioning based on external
analysis but also to the integrative capability that contributes to ‘sensing,
transferring and modifying internal and external resources and capabili-
ties.’ Complementarity will depend on the strength, of this integrative
capability and may involve new organisational structures, operational
systems and business processes. Furthermore, such integration is likely to
span organisational boundaries as organisations cooperate and collabo-
rate in new types of business ecosystem. This point is reinforced by BCG
(2020) whose findings showed that manufacturing organisations are
achieving smarter automation and harnessing efficiency in several ways
including installing smart robots and using collaborative robots; employ-
ing augmented reality; applying production simulations and using Big
Data and Analytics. These require a significant amount of integration
competence.
There is a range of possibility for the type of complementarities that
can occur. Reciprocal interdependence, for example is the ‘synchronous
adoption of product and process innovation often creating opportunities
102 P. Turner
for other product and process innovations.’ In this case, complementarity

would be identified and realised by ensuring strong links between prod-
uct development and business process improvement or reengineering as
they take place. Sequential interdependence, another variation is where
‘the project commences with the development of a new product concept,
this subsequently necessitates (triggers) changes in process innovation.’
The integration of strategic processes in this case would once again be
between product development and process engineering but here, process
improvement would take place ‘downstream.’ The organisation would
build in waypoints into the strategy process to ensure that such opportu-
nities are picked up. Finally, pooled interdependence would require the
conversion of tacit knowledge into explicit knowledge that is available
across the organisation, and this would be an integral part of the strategy
process. Refinement of these concepts and depending on the aims of the
strategy (such as New Product and Process Development) complemen-
tarities could be derived from a variety of combinations (Hullova et al.,
2016). Having specific ways of so doing will be an important consider-
ation in strategy setting.
The potential for the integration of strategic processes exists regardless
of the scale of the organisation or its evolution and history. On the one
hand, larger organisations may have a stronger presence in a chosen mar-
ket or may have the advantage of economies of scale and scope. On the
other hand, smaller organisations may have less bureaucracy and as a
result be more open to innovation, agile and more efficient in integra-
tion. There will be fewer silos or barriers to change (Cassiman &
Veugelers, 2006).
In established organisations, functional experience complementarity
will be an important aspect of integration. Where the CEO and top man-
agement team have experience across several aspects of the organisation,
then they are more likely to be supportive of strategies outside of any one
particular function in favour of combining aspects of singular strategies
by taking a holistic view of the benefits to the organisation. The ‘realism
of experience’ may well add value to complementarity in strategy setting
(Reimer et al., 2018; Pang et al., 2019; Yoder, 2019). But realism doesn’t
only come from experience. Nor does it only come from a deep under-
standing of business theory. Indeed, many of the characteristics of the
Fourth Industrial Revolution will be unprecedented. Hence an impor-

tant ability in integrating processes will be practically informed, in real
time and dependent on the agility of those responsible for integrating to
draw on immediate experience and realism to craft strategy in new,
unforeseen ways. Functional experience will be enhanced by managerial
agility in the here and now.
The integration of strategic processes will therefore require a number
of initiatives.
In the first place, a reengineering of the overall strategy setting process
to reflect the opportunity for complementarity. This means that each
domain strategy includes the identification of potential cross domain
complementarities. To facilitate this will require the communication of
the overall strategic process and the engagement of the whole organisa-
tion into its intent or objectives. The process will include the introduc-
tion of incentives for leaders and managers to identify complementarity
opportunities outside of their own domains. Methodologies to capture
and demonstrate the benefits of complementarity will be included as part
of this. The process will also clarify that the level of complementarities
identified will inform how assets and resources are allocated or
orchestrated.
A factor that applies to all of the above processes will be the ability of
the organisation to mobilise its human resources. Amongst the challenges
will be exploiting unique, rare or complex people resources such as tacit
knowledge, or the relationships between levels of management and
between managers and the workforce.
• Exploiting social complexity
Complementarity goes beyond systems and processes and its success

will be informed as much by human interaction as by technology interac-
tion. For example, whilst a particular technology may be available to all
organisations, only one of them may have the social relations or culture
or a history of success in technology installation to ensure its effective-
ness; complementarities between human resource management and
innovation activities can have an impact on both innovativeness and pro-
ductivity (Bartoloni & Baussola, 2018). It is to this area that social
104 P. Turner
complexity applies. Social complexity was identified by Barney in his

definitive work on resources and competitive advantage (Barney, 1991
and Barney and Clarke 2007). Amongst the reasons for such complexity
were interpersonal relations between managers and its culture or dynamic,
higher-order capabilities including unique competencies for creating,
capturing, and transferring knowledge and its application in innovation
(Camisón et al., 2016). The complementarity of respective actions of
individuals, creates beneficial cooperation over and above that which
might be normally expected. Contributory factors include not only com-
munication and the division of labour, but also joint actions involving
‘complex rituals,’ joint decision making, committing to collective behav-
iour, acting in concert in relation to outsiders, and ‘any action whose
outcome depends on cooperation based on shared understandings’ (Fiske,
2000). Hence from management style to culture to knowledge, social
complexity has a broad reach. Because of the challenges in replicating its
characteristics—relationships or culture are imperfectly imitable—an
organisation that has efficiency and effectiveness in its management, a
unique ability to turn tacit into explicit knowledge or a culture that fos-
ters innovation, should ensure that its strategy setting process takes
account of these hard to replicate features and that asset orchestration
and resource allocation build on them. The principle can apply in differ-
ent types of organisations.
In one case it could be that organisational practice is based on a clear-
cut formal hierarchy, whereby a formally identified leader has the author-
ity to ‘direct group members’ behaviour, assign roles to individual
members, and monitor their efforts and performance.’ Praise of hierarchy
is a rarity, but where this is effective-positive relationships between man-
agers, an efficient culture, or a history of making such formality work—
then complementarity will be geared towards how the outputs of this
formality can benefit other parts of the organisation. However, in the
absence of formal power and authority structures—perhaps in networks
or matrices or swarms—informality can equally be source of effectiveness
and efficiency. The challenge of social complexity spans both of these
perspectives on organisation. It has been argued that ‘organisations often
have difficulties ensuring that managers and others look past their self-
interest to support collective, official goals. This is the classic problem of
organisational control’ (Cardinal et al., 2017; Oedzes et al., 2018). Where
those managers are able to go beyond this self-interest, then there is the
potential for a more inclusive strategy in pursuit of progression.
Indeed, the ability to collaborate in the creation and sharing of knowl-
edge and information will be regarded as a core management competence
with a working definition of ‘the ability to disseminate knowledge by
connecting individuals and teams and inspire them to collaborate in
working towards common goals’ (Turner, 2021). How an organisation
uses this knowledge will contribute to how that organisation performs in
its chosen markets. The ways of so doing will be through interactivity and
the promotion of knowledge flow and integration. And an aspect that
will be key to this is collaboration and cooperation whereby members of
the workforce share through formal channels such as strategic projects or
business improvement schemes as well as outside of any structured or
curated interactions. Such a process is socially complex and therefore
hard to imitate. Its contribution to progression might be immense and it
is therefore an important part of the strategy setting process, albeit in the
resource-based approach as opposed to the rational market analysis one.
Exploiting social complexity means taking advantage of knowledge. It
means building a strategy around the uniqueness or rareness of knowl-
edge that the organisation possesses. Hence a requirement is to identify
where such knowledge exists and providing a mechanism by which such
knowledge can be shared amongst all of the domains. Converting tacit
knowledge into explicit knowledge is therefore an important objective. A
second aspect of exploiting social complexity and its role in strategy is
recognising that the uniqueness of the organisation’s leadership and man-
agement resources are a source of competitive progression. Strategy set-
ting may therefore build upon this strength in creating its strategic
options. And thirdly it means providing a strategy setting process that
includes communication, participation, and joint action, making joint
decisions and channelling knowledge by committing to collective behav-
iour in the agreement and execution of strategy. It is strategy which
includes cooperation and shared understanding.
The objective of cross domain alignment, the principle of asset orches-
tration, the creation of integrated strategic processes and the exploitation
of the uniqueness of social complexity are addressed to create an environ-
ment in which complementarity can flourish. However, there is a final
106 P. Turner
aspect of strategy setting that will cement the concept into the organisa-
tion’s strategy and that is by capturing the benefits of these methods and
to demonstrate how they have contributed to performance.
• Measuring the outputs of complementarity
Complementarity depends on integrating strategies or adding an activ-

ity to that of another with the objective of business performance improve-
ment over and above that which would result from the independent or
singular creation of strategy—in a single domain such as a business unit
or function. However, to realize the full potential, complementarity
directed control mechanisms and measurement systems will be required
to capture any benefits. Metrics will address the core idea that ‘simultane-
ous implementation of different activities should prove to be more valu-
able than implementing each of them separately.’ The test of
complementarity is guided by measures which assess performance using
measures of interactivity and the impact of combinations of activities.
The objective will be to demonstrate that strategies, when applied together
‘are greater than any isolated additive effects—an example being the posi-
tive relationship between complementarity and innovation and service
capability.’ Measures can relate to sequential complementarity and con-
tinuous monitoring of performance; information complementarity;
organisational complementarity; methodical complementarity and hier-
archical complementarity. Which relates to information gathered as part
of performance management at the policy level (Nielsen & Hunter,
2013). In this respect, organisations will undertake complementarity
strategies if such strategies increase returns on investment made through
complementarity between units or functions—a productivity effect or by
increasing their performance in the markets in which they choose to
operate—a strategic effect. (Milgrom & Roberts, 1990; Zhang & Zhao,
2010; Mothe et al., 2015; Di Giannatale & Passarelli, 2018). The chal-
lenge is to demonstrate such benefits.
And so, if the organisation’s business strategies are truly complemen-
tary, then their effect will show up in measures of performance. To this
end, management control systems should be designed to ‘motivate subor-
dinates and direct their attention to what is important for optimizing
their particular areas of responsibility (e.g. purchasing, production or

marketing) while, at the same time, ensure that they do so in a way that
is consistent with overall financial objectives.’ To achieve this, Gerdin
et al. (2019) propose certain conditions for synergy effects to occur. These
include that management control practices are complements in solving a
particular control problem and that management controls contribute to
achieving the goals of the control combination interactively. This means
functionally specialized management controls being reciprocally interde-
pendent where the marginal returns of one control is increased when
combined with another control, and vice versa.
There is evidence that returns are possible. For example, complemen-
tarities between IT components have been shown to be ‘significantly
associated with firm profitability … we find that, in contrast to prior
studies, IT investment is significantly associated with firm profitability
measured by ROA and ROE.’ The application of IT influenced customer,
financial, human resources, and organisational effectiveness as measures
of performance. However, this is not deliverable without the additional
complementarity of knowledge or competences of the organisation’s
human resources. (Jiung-Yee Lee et al., 2014) The challenge is for organ-
isations to develop information systems that recognise and measure addi-
tional outputs in a coherent format. Whilst there are numerous ways of
measuring Return on Investment, the challenge is to measure the Return
on Complementarity.
Underpinning all of the above are systems that provide four levels of
knowledge:
• Data—in this example, the degree of complementarity will be shown

to have an impact on an aspect of performance such as product sales,
where innovative bundling can be shown to expand the sales of exist-
ing products and new products (Liu et al., 2020)
• Information—data that has been selectively refined to produce more
meaningful outputs, can show improvements in efficiency—which
would be a productivity effect, and which consists in the improvement
of a domain or function. This effect is positive if there are substantial
complementarities among their resources such as synergies, better
organization, economies of scale (Di Giannatale & Passarelli, 2018)
108 P. Turner
amongst the information outputs that could be identified are profit-

ability, Return on Investment, Return on Assets—the ratio between a
company’s annual earnings and its total assets, and Return on Equity.
• The third element of knowledge can be referred to as intelligence and
is a combination of internal and external data or information sources.
This will measure the strategic effect of complementarity such as mar-
ket power or position against competitors, improved customer experi-
ence, better ‘upstream’ supplier performance Here, organisations will
be shown to achieve better financial returns because of adopting a con-
textually appropriate mix of practices in a complementary way. A
study of Indian organisations found that service organisations with
high customer involvement capability were able to gather information
from customers which informed innovation activities and strategies to
create competitive advantage (Di Giannatale & Passarelli, 2018;
Darwish et al., 2019).
• The fourth and final aspect of measuring the effectiveness of comple-
mentarity is that of Insight. This means the unique knowledge that
organisations acquire from intelligence over time, which in itself
becomes a unique or rare resource.
Measuring the outputs of complementarity is an important part of the

strategy setting process. It provides a business case to support the align-
ment of domain strategies, the orchestration of resources and investment
decisions. What is measured, how it is measured and how it is converted
to explicit knowledge will ultimately determine whether there is business
support for the concept.
Conclusion
There is a strong case for developing strategy with complementarity at its
heart. Assets and activities are mutually complementary if the marginal
return of one activity increased the level of the other. In other words, ‘if
doing more of an activity (x) the marginal benefits of doing more of a
complementary activity (y) increase. Complementarity gives rise to syn-
ergy among the complementary activities ‘with the total being more than
the sum of the parts.’ If, for example, a manufacturer raises the reliability
of a product by investing in better production equipment and processes,

it may become attractive to extend the warranty as well. Competitive
advantage has been gained by how the investment in tangible production
assets increased the value of the brand in terms of reliability whilst in turn
allowing a more competitive service offering. In the resource-based view
of strategy complementary assets play a crucial role in explaining sustain-
able competitive advantages and innovations (Milgrom & Roberts, 1990;
Stieglitz & Heine, 2007). If the organisation’s various domain strategies
can be developed with this fundamental point in mind, then the oppor-
tunity for improved business performance can be realised.
But strategy and strategy setting can be interpreted in numerous ways.
It can be a dynamic process that reviews missions, strategies, and opera-
tions relative to market forces, or it can be about crafting a strategy that
seeks innovation and imagines new, different futures. Either way its suc-
cess will depend on coherence, congruence, and consistency, how the
management of the organisation goes about strategy setting and effective
asset orchestration and resource allocation—how organisations allocate
their investments and whether this allocation maximises organisational
capabilities. Developing a strategy that not only considers total invest-
ment, but investments in specific configurations of assets is therefore
essential to complementarity (Aral & Weill, 2007; Srivastava & D’Souza,
2021). The need actively to manage the creation and usage of comple-
mentary assets requires coordination and cooperation. Organisations
have ‘different characteristics, operate in different institutional contexts
and work on a portfolio of projects,’ and for these reasons there is ‘no
simple winning complementarity strategy’ (Hullova et al., 2016) between
product and process innovation.
Complementarity strategy will most likely be best fit rather than best
practice.
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5
Complementarity in Leadership
and Management
Progression, Complementarity
and Business Strategy
Progression towards an organisation’s objectives will be influenced by the
strategic choices made by leaders and managers, and the efficacy of the
actions taken to implement them. At corporate level—for example, this
will involve decisions about the positioning of subsidiaries in chosen
markets; whilst at business unit level—a company or a firm—it will
involve direction and actions with specific objectives in mind such as
profitability or market share. And strategy can also refer to a domain or
function within a business unit where it is set to ensure the performance
of that particular area—such as IT or Finance—closely aligned with the
goals of the organisation as a whole. In each of these scenarios, leaders
and managers will make decisions about positioning, support them with
resource allocation and engender them with the promotion of a collab-
orative culture—instrumental in advancing complementarity. The ways
they do so will be set in the context of the organisation because the term
strategy is interpreted in a variety of ways with a range of objectives. To
support these interpretations is a panoply of strategic theory and practice
https://doi.org/10.1007/978-3-031-10654-5_5
116 P. Turner
from which organisations can choose to help in their navigation. In one

model, strategy is concerned with achieving competitive advantage by
differentiation or by being the lowest cost provider and ensuring that a
value chain is established to reinforce these; in another it can be based on
unique competences or resources—the resource-based view. It can be
formed through systematic analysis and developing a position within a
particular market, or it can be more opportunistic using the organisa-
tion’s agility to respond to changes in the environment.
Strategy formation covers organisational activities from mission and
vision to the direction of travel, from competences, and capabilities, to
commitment and organisational learning (Ahlstrad & Mintzberg, 1998).
And contemporaneously, business strategy is ‘less of a mould into which
corporate ingredients could be poured and a fully formed figure emerg-
ing, to more like clay on a turntable, fashioned and crafted into shape.’
Whatever route is chosen and whatever formula is prepared to get there,
strategy will succeed where there is coherence—an alignment between
expectation and reality; congruence—where elements of the strategy are
integrated and reinforce each other; and consistency—between intention
and action. In this construct, strategy is not just a top-down process, ‘a
successful strategy execution process is seldom a one-way trickle-down
cascade of decisions.’ Instead, it will be more inclusive, maximising the
potential of tacit and explicit knowledge and using resources to their
optimum levels (Barney, 1991; Fedele & Mantovani, 2008; Vermeulen,
2017). An assumption is that leaders and managers will create a comple-
mentarity effect through their competence and orchestration of the
organisation’s resources. A working hypothesis for this chapter therefore
is that the qualities of leadership and the qualities of management, when
combined, produce more than the sum of the qualities of leadership or
the qualities of management as singular instances. The complementarity
benefit is significant and will be achieved when leaders recognise and act
on this potential harnessing the creative potential of employees as they
work with new technologies. They have a pivotal role in ‘accelerating the
transition to new heuristics’ (Pedota & Piscitella, 2021). How the organ-
isation defines the terms leadership and management will help to identify
what qualities are needed in this acceleration.
5 Complementarity in Leadership and Management 117
rogression, Complementarity, Leadership

P
and Management
As with the previous Three Industrial Revolutions, new technology will
be a major factor in influencing the nature of these qualities. However,
this is only one of several powerful forces that are shaping the way in
which organisations will prosper. Instead, as progression manifests itself
by results—profit, return on investment, maximisation of shareholder
value and by the successful adaptation to contemporary environments,
leaders and managers will work where social objectives—fair-trade prac-
tices, contribution to social welfare, respect for and understanding about
the environment, diversity, and equality of opportunity are included in
corporate manifestos. As outlined previously business progression means
achieving economic growth whilst having a positive effect on society as a
whole. It means not only developing a competitive advantage but invest-
ing to sustain that advantage. Hence, whilst leadership and management
practices will continue to be valuable where they stand alone (for example
in a business unit or domain), there is also greater potential because dif-
ferent practices may also complement each other across the organisation,
making joint adoption of particular types of management practice more
valuable (Hong et al., 2015). How the concepts of leadership and man-
agement have evolved may be important in informing a best fit style,
structure, and function for the future. In addition, they may provide the
foundations on which a complementarity approach towards leadership
and management can be developed.
But clarity about their precise definitions continue to present
challenges.
In spite of decades of analysis there is no universally accepted theory of
leadership. In one respect it can be based on contingency theory which
will link leadership style to a particular environment or situation; in
another it can be based on exchange theory, which will focus on the
theme of leader—follower relationships. From one perspective, leader-
ship can be transformational; from another it can be framed in terms of
an individual’s charisma. Then there are the high-level leaders who are
able to build enduring greatness through a blend of personal humility
118 P. Turner
and professional will; or those with emotional awareness which allows

them to achieve more than those without—i.e. they have high levels of
emotional intelligence. For some, leadership is concerned with authentic-
ity; or inverting the traditional perception to become servant leaders.
Others still will attempt a ‘shift’ to a new level where purpose, mastery,
autonomy and trust are characteristics of the organisation and whose
leaders share aligned values and aspirations. Leadership can be person,
process or position based or that based on trait, behaviour, power-
influence, situational, integrative or intra individual (Greenleaf, 1977;
Burns, 1978; Bass, 1985; Conger & Kanungo, 1987; Goleman, 1996,
1998; Collins, 2001; Alimo-Metcalfe & Alban-Metcalfe, 2003; Grint,
2005; Kodish, 2006; Yukl, 2010; Hlupic, 2014). Such leaders see oppor-
tunities in challenges and build a strategy for exceptional performance;
they are ‘powerful but humble,’ see leadership in terms of collective action
and lead for change and adaptability. In most cases, leaders will be people
who ‘mobilise others to want to get extraordinary things done in organ-
isations … transform values into actions, visions into realities, obstacles
into innovations, separateness into solidarity, risks into rewards … create
a climate in which people turn challenging opportunities into remarkable
successes’ (Kouzes & Posner, 2003, p. 8). Theories sometimes distinguish
between a leader who sits at the head of an organisation, department or
business unit and leadership which is a social phenomenon that occurs at
many organisational levels and points. There is compelling support for
Kilburg and Donohue’s conclusion (2011) that ‘leadership is a complex,
multidimensional, emergent process in which the leader and followers
use their characteristics, capabilities, thoughts, feelings, and behaviours
to create mutually influencing relationships that enable them to coevolve
strategies, tactics, structures, processes, directions, and other methods of
building and managing human enterprises.’ The consensus basis of these
styles is that such leaders achieve exceptional things through followers
who would be deemed to go the extra mile.
The concept of management is an equally rich source of discussion and
interpretation such that it can be seen as a constellation of concepts
and ideas.
Indeed, there are few concepts that have attracted as much business
interest as the management of organisations. The breadth and depth of
reach of management means that it can often span the boundaries of

leadership and strategy whilst also applying to business administration.
In their day-to-day roles managers are responsible for operational effi-
ciency whilst also dealing with human emotions. ‘They are responsible
for intangibles—such as brands or goodwill, and tangibles—such as
machinery on a production line or IT systems in a bank. Managers are
concerned with both change and stability; sometimes simultaneously.
They operate within Weberian hierarchies—‘functional frames of refer-
ence,’ or in network or swarm structures because in ‘our digitally medi-
ated world’ the classic bureaucracy is less prevalent (Hilbert, 1987;
Muellerleile & Robertson, 2018; Turner, 2021). Diverse points of view
about best practice have proliferated since Adam Smith first articulated
the productivity benefits of the Division of Labour during the First
Industrial Revolution.
The concept of management evolved with each Industrial Revolution.
During the nineteenth century—the Second Industrial Revolution—
greater analysis of management practice led to the evolution of Scientific
Management, made famous by Frederick Winslow Taylor, applied in the
factories of Henry Ford and taken into a European context by Henri
Fayol. The limitations of only using time clocks, stop watches and slide
rules became apparent and led to the growth of a more people related
emphasis on management and from the early twentieth century—The
Third Industrial Revolution—with the emergence of Behavioural
Management followed by Management as a Science emphasizing the
importance of the organisational environment. In this interpretation of
management ‘professional managers were assigned responsibility for
planning, setting goals defining problems and making decisions. The
methodological cornerstone was a contingency approach with unobtru-
sive control devices such as job specification, internal career ladders and
operating routines monitoring performance’ (Wilson & Thomson,
2009). Theoretical (and practical) approaches to management prolifer-
ated out of the work of Peter Drucker (The Practice of Management 1954)
through to W. Edwards Deming (Out of the Crisis 1982) and Total
Quality Management through to Thomas Peters and Robert Waterman
(In Search of Excellence 1982) and the Learning Organisation.
120 P. Turner
Globalisation from the mid-twentieth century further enriched the

subject with Management as Practice incorporating innovations intro-
duced by successful global corporations that came out of the economies
of Asia. At the forefront of this point of view was Henry Mintzberg with
his fundamental question ‘how do we make sense of the vast array of
activities that constitute managing?’ (Mintzberg, 2011). He was of the
opinion that leaders could not simply delegate management. Instead,
managers were themselves leaders and leadership was management prac-
ticed well. In addition, he proposed that management was not uniquely
a science nor uniquely a profession, but a practice that could be learned
through experience and context. The essence of management of practice
was not confined to purely Western centric approaches and a rich canvass
of new management styles—originating in Japan—became sources of
innovation. Whilst there was no one single management culture (Sanger
et al., 2017), there has been a significant influence of Asian management
practices. ‘It might be argued that the impact of Taiichi Ohno of Toyota
who is credited with developing the JIT (Just in Time) system in the
1950’s and 1960’s was as powerful an influence as F.W. Taylor; or that of
Soichiro Honda, Zhang Ruimin, Lakshmi Mittal and Jack Ma as influen-
tial as Henry Ford. The rise of Japanese corporations introduced a whole
new set of systems, processes and language of management. Amongst
these were total quality management and continuous improvement that
gained global traction’ (Turner, 2021). Decision making by consensus,
root cause problem solving, Just-in-Time systems, jidoka, or ‘automation
with a human touch;’ kanban, a production tool helping just-in-time
production and poka yoke or mistake proofing are concepts that can be
added to the canon of management theory. Child (1969) believed that
management could be regarded as either an economic resource perform-
ing a series of technical functions including organising and administering
of resources; or as a system of authority where policy is translated into the
execution of tasks; or as an elite social grouping which acts as an eco-
nomic resource in maintaining systems of authority. Wilson and Thomson
(2009); and Muldoon et al. (2020) provide comprehensive analyses and
are essential reading on the subject. However, much in the same way as
leadership, there is an argument that universal solutions to management
problems do not exist (Hofstede, 2007). The upheavals of the second
decade of the twenty-first century reinforce the point of a more context

specific view.
Hence, as industrial and commercial organisations were transformed
over the course of Four Industrial Revolutions, the concepts of leadership
and management duly followed suit, producing disciplines that are full of
richness and diversity, as well as controversy and contradiction.
Convergence of Leadership
A
and Management Responsibilities
An additional source of debate is whether the roles of leadership and
management continue to be separate functions or whether new organisa-
tion designs blur the boundaries between them. The roles and responsi-
bilities of leaders and managers have overlapped and in others converged
with each phase of industrialisation such that leadership is in many
instances one of the roles of the manager (Ellis & Bach, 2015), and man-
agement is one of the roles of the leader. In complex, fast moving envi-
ronments how could this not be the case? Peter Drucker believed that
separating management from leadership, was nonsense—‘as much non-
sense as separating management from entrepreneurship. Those are part
and parcel of the same job. They are different to be sure, but only as dif-
ferent as the right hand from the left or the nose from the mouth. They
belong to the same body’ (quoted in Galagan, 1998). Whilst Henry
Mintzberg noted that ‘leadership cannot simply delegate management;
instead of distinguishing managers from leaders, we should see leaders as
managers, and leadership as management practiced well’ (Mintzberg,
2011).
In resolving this debate, the scope and structure of the organisation
will increasingly contribute to a convergence of roles. ‘Organisations are
sets of ongoing human relationships utilising various technologies in
which people cooperate to achieve tasks which would otherwise not be
possible either at all or from an equivalent resource base’ (Watson, 1994).
At the heart of the managerial role is the task of orchestrating exchanges
within the construct such that managerial work is organising work.
Where there are fewer boundaries within organisations and achieving
122 P. Turner
objectives increasingly become collaborative exercises, then leaders will

be forced to manage in the classical sense and managers will be forced to
lead, again in the classical sense. From the Goffee and Jones (2006) point
of view leadership is non-hierarchical and there will inevitably be an over-
lap with those roles designated as managerial ones. Similarly, if managers
undertake activity outside of strictly designated boundaries (because
there may be none or they may have changed-) then this may be inter-
preted as leadership. Mintzberg’s belief that delineations between leader-
ship and management were wrong because ‘managing is controlling and
doing and dealing and thinking and leading and deciding and more’
(Mintzberg, 2011). It is this hypothesis that will be applied to the narra-
tive about the role of leaders and managers in respect of complementarity
and the competences necessary to fulfil this role.
The know-how, know why, know when, know what and know how to behave
of management will contribute to organisational success by singularity—which
are discreet interventions in a specific domain—and complementarity—which
are interventions connected to a broader purpose—such as to contribute to pro-
gression in another domain.
The new technologies of the Fourth Industrial Revolution will trans-

form business models, strategies and operational processes and have the
potential to change how people in the workforce connect, interact, and
communicate. These dynamics will demand that leaders and managers
are agile, unconcerned with boundaries, adaptable and collaborative. The
competences that have been identified in previous studies will take place
in a different context. Competences may be defined as those things that
are causally related to effective performance, consisting of knowledge—
which is the retention and utilisation of information, skills—or the abil-
ity to demonstrate a sequence of behaviour towards a goal—and attitudes
and behaviours—which are the social manifestations of how a manager
undertakes a role (Boyatzis, 1982). They can be specific, such as technol-
ogy knowledge or that related to the business domain, or generic relating
to interpersonal competences.
A typology includes cognitive competence or work-related knowledge
and the ability to apply it; functional competence the ability to perform
work-based tasks; social competence or relational and communication

skills; and meta-competence or personal and professional values. They are
the know-how, know why, know what, know when and know how to
behave of management (Turner, 2021). These competences will contrib-
ute to organisational success by singularity—which are discreet interven-
tions in a specific domain—and complementarity—which are
interventions connected to a broader purpose—such as to contribute to
progression in another domain. Complementarity means organisational
constructs and actions that are collaborative, multi layered, multi-faceted
and most of all add to the competitiveness of the whole organisation. The
convergence of many of the responsibilities of leaders and managers and
the blurring of organisational lines mean that in some organisations the
roles will overlap requiring a good deal of flexibility on the part of the
people who fulfil those roles; or they may merge completely-depending
on how ‘flat’ the organisational structure is or be temporary as in the case
in swarm organisations (such as projects or ad hoc initiatives).
In whatever way leadership and management is configured, the roles of
leaders and managers will have additional elements because of comple-
mentarity and there are two important considerations. First. what are the
competences needed for leaders and managers as they take on these new
elements? Second how will the role change with the new emphasis and
what will be the priorities?
he Competences of Leaders and Managers

T
to Deliver the Potential of Complementarity
The ‘Promise of Complementary Leadership’ manifests itself in one of
four ways. The first is referred to as ‘task complementarity,’ where leaders
divide management responsibilities into coherent blocks of tasks. The
second is ‘expertise complementarity’—where different levels of skill
between leaders and managers result in the formation of teams with com-
plementary expertise. A third manifestation might be referred to as ‘cog-
nitive complementarity’—which involves differences in how individuals
process information.
124 P. Turner
It is extraordinarily rare, for example, to find leaders who are equally good at
dealing with the big picture—creating and communicating compelling visions
and crafting breakthrough strategies—and at driving execution through an
intense focus on tactics, details, and follow-through.
And a fourth is ‘role complementarity’ which involves leaders playing

discrete and complementary social roles in organisations—for example
when one leader plays diplomat and another plays warrior (Miles &
Watkins, 2007). These descriptions demonstrate that there is no best
practice approach. Instead, the type of complementarity is often best fit
based on the specific circumstances of an organisation, unit, domain, or
department. Nevertheless, it is worth pursuing whether there are aspects
of competence that underpin leadership and management roles or con-
figurations of interactions that, when applied can provide intrinsic ben-
efits (Bruning et al., 2020).
Figure 5.1 shows five possible areas of competence that might be con-
sidered as appropriate for leaders and managers seeking complementari-
ties in their organisations. These are (after Turner, 2021):
Demonstrates agile
governance in
identifying and
delivering
complementarity
Integrates multiple opportunities 'know Collaborates to create
systems and processes what to do' and share knowledge
and seeks and information to
complimentarities expand the potential for
through synergy-'know complementarity 'know
how' why'
Engages and Develops

●Knows when to Leadership and the Workforce to
allocate resources and Management identify opportunities
knowing how this will Competences for for complementarity
impact on other projects complementarity within and without their
or business initiatives 'know thyself' own domains 'know
how to behave'
Fig. 5.1 Leadership and management competences for complementarity

• Demonstrates agile governance in identifying and delivering com-

plementarity opportunities—‘know how’
Agile governance in its general management definition means ‘the

ability to respond to change in a dynamic and flexible way; aligning
change methodologies to the needs of the unit; whilst identifying the
ramifications of change for areas outside of the unit and influencing
or shaping the organisation and its processes accordingly.’ In this
respect agile governance bears elements of transcendence, with the impli-
cation that the manager is not totally constrained by current boundaries;
but is able to think beyond barriers and redefine the context and terms of
the business practice. Complementarity will require agility in respect
of identifying opportunity over and above that within the leader’s or
manager’s day to day responsibilities or domain and influencing the
organisation to take advantage of that opportunity. The leader or man-
ager will need to negotiate cross domain alignment in making these deci-
sions and it will take agility to maximise any additional opportunities
between competing demands, but also to reconcile any differences—
maintaining a course towards strategic objectives but manoeuvrability in
the overall direction (Rozuel, 2011; Queiroz et al., 2020; Feizabadi et al.,
2021; Turner, 2021). For example, if an opportunity presents itself—an
application of technology that hadn’t been anticipated or knowledge in
one process that can be applied to another—the leader or manager would
be able to influence a shift in that direction by being confident and com-
petent in taking responsibility to reshape or to influence others to do the
same; to take advantage of the opportunity. An aspect of core compe-
tence will be to influence change across the whole system regardless of
system boundaries to deliver the additional benefits (Hammer & Champy,
1993; Lopes et al., 2016; Bogel et al., 2019; Cohen, 2019; Javidroozi
et al., 2019; Maisiri et al., 2019; Marr, 2019; Luna et al., 2020; Renjen,
2020). Agile governance, with its implications of cross boundary work-
ing, demands a strong leaning towards collaboration and knowledge
sharing.
• Collaborates to create and share knowledge and information to

expand the potential for complementarity—‘know why’
126 P. Turner
The ability to optimise resource deployment will be a critical facet of

the role of the leader or manager as they seek to deliver the potential of
complementarity. Key to this will be effective knowledge management
through connecting individuals and teams and turning tacit into explicit
knowledge for the benefit of the whole organisation. This does not only
apply to the domain for which the particular leader or manager has
responsibility but the ability to acquire and share resources and knowl-
edge with others—complementarities arise from both similar and dis-
similar resources (Soda & Furlotti, 2017). This assumption is based on
the principle that collaboration provides access to scarce resources and
enables synergistic interaction between businesses as a source of competi-
tive advantage. The complementarity view is that once accessed, a bundle
of resources grants a higher value, and that ‘knowledge-as-a-bundle’ offers
‘higher values to organisations when deployed jointly.’ However, comple-
mentarity will only be achieved where there are coordination mechanisms
to enable collaboration. Understanding this and facilitating access in a
holistic way is an important feature of competence since resource com-
plementarity is not given but jointly constructed in interactions with
multiple potential partners through recursive cycles (Deken et al., 2018).
One of the responsibilities of leaders and managers will be to ensure that
norms are set and adhered to that foster collaboration and trust.
Knowledge complementarity will come about when organisations
commit to management and direction of the internal knowledge base.
The objective is the promotion of knowledge flow and integrating that
knowledge into complementary activities. For example, customer intel-
ligence used in creating products and services could also be used in man-
ufacturing, supply chain or finance activity. Complementarity occurs
where knowledge is actively shared and used in areas outside of its origi-
nal source, producing performance outcomes over and above what would
have occurred if the knowledge had remained in its original domain.
Collaboration and cooperation mean sharing through formal channels
such as strategic projects or business improvement schemes and outside
of any structured or curated interactions (Wang et al., 2004; Deiser,
2009; Chaudhuri & Boer, 2016; Pinnington & Ayoub, 2019; Bolade,
2021; Xu & Zeng, 2021). Leaders and managers will act as creators of
knowledge, sources of knowledge, and disseminators of knowledge in the
quest for additional opportunities and benefits.
• Engages and Develops the Workforce to identify opportunities for

complementarity within and without their own domains ‘know
how to behave’
A third area of importance is the ability to engage the workforce to

spot opportunities and to create a culture whereby it is normal to articu-
late them routinely as part of the management of the particular area or
domain; or exceptionally outside of any formal structural boundaries. In
this, the leader or manager will seek to strike a balance between control
‘aimed at alignment of individuals’ behaviour with organisational goals,’
and autonomy or the individual ability to exercise a degree of control
over the content, timing, location, and performance of activities. This
means management mechanisms that leave a way for employees to ‘feel
empowered, to participate, and to enact and increase their professional
competence (which) will establish a complementary system that rein-
forces the effects of control and intrinsic motivation in aligning organisa-
tional members’ activities with organisational objectives’ (Porter & van
den Hooff, 2020). The system would take account of the needs of all
those involved whilst at the same time supporting the complementarity
nature of knowledge sources i.e. ‘the simultaneous adoption of different
sources being more valuable than the use of each of them separately’
(Serrano-Bedia et al., 2018). Where leaders and managers are successful
in this then it can prove to be a primary source of motivating employees
for their defined objectives as well as activities, which generate ‘employee
knowledge through boundary-spanning exploration’ (Fang et al., 2021).
In its most general sense this aspect of competence is ‘the ability to cre-
ate a positive working environment and inspire individuals to apply
themselves with intelligence, energy, resilience, enthusiasm and concen-
tration; whilst providing the means for their personal and professional
development’ (Turner, 2021). Articulating the ‘why of work’ (Ulrich &
Ulrich, 2011) in this case means creating a culture for complementarity
whereby members of the workforce understand and are enthused by the
prospect of enhancing the performance of the whole organisation as well
as the particular domain in which they work. It means creating a learning
culture that benefits both individual members of the workforce and the
organisation as a whole. But this does not only mean learning for those
128 P. Turner
being managed, it means learning for those managing. Having an open

or ‘Sunao’ mind will be a success factor for the performance of leaders
and managers.
• Knows when to allocate resources and knows how this will impact
on other projects or business initiatives
Brynjolfsson and Milgrom (2013) asked the question why is organisa-

tional change so difficult? and concluded that ‘when there are a large
number of complementarities among practices within an existing system,
but conflicts between practices from the old system and practices from
the new system, then it is likely that the transition will be difficult.’ One
way of addressing this issue was to change all of the practices in the new
system simultaneously. However, this was likely to be unfeasible for a
number of reasons. In addition to possible coordination problems or the
presence of poorly defined practices centred on culture or heuristics, was
that of timing. Here, some of the dependent variables may not be syn-
chronized. Knowing when to act or to change will therefore be critical to
progression.
Recognising opportunities is an important aspect of the role of leaders
and managers. But acting to create any synergies that result will decide
whether the opportunity is realised. Knowing how, knowing why, and
knowing what to do are the bases for actions. But a further aspect of
leadership and management competence therefore relates to the timing
of decisions. The priority here is not only how the alignment of business
strategy with the organisation’s objectives takes place but when. The more
coordinated alignment practices are, the more valuable they will be had
they been taken in isolation. Knowing when to allocate resources and
knowing how this will impact on other projects or business initiatives will
be critical aspects of leadership and management competence. In this
instance the leader or manager will be faced with choices. Should deci-
sions be made to follow a sequential path—challenge and response—or
should projects or initiatives be enacted simultaneously. And whilst
research has shown that high levels of alignment practices and high levels
of complementarity in the early phase of a particular initiative, led to
higher levels of value, there are unlikely to be hard and fast rules. Instead,
the decisions will be specific to the context, culture and resource levels of
a particular organisation (Harrison et al., 2001;Vermerris et al., 2014;

Luna et al. 2020; Turner, 2021). The velocity of change will need to be
matched by the pace and precision of internal decision making which is
sufficiently inclusive but not delayed by being mired in debate.
• Integrates multiple systems and processes and seeks complemen-

tarity through synergy—‘know how’
Complementarity always takes place with a focus on outcomes. But

the essence of the construct is a focus on multiple outcomes—from a
particular domain but also those that stem from learning or resources in
that domain being used to improve the performance of others. Their
delivery will depend in large part on the ability of leaders and managers
to comprehend and use technology tools and processes both to manage
information derived from customers and from the market, but also to
implement complementarities that arise from cross boundary applica-
tions. They will be critical to each of four dimensions, these being infra-
structure; technical and managerial knowledge; the development of the
different IT resources and the degree of integration with strategy. All will
depend on effective integration of systems and processes. The proposition
is that leadership and management competence in integration, by enhanc-
ing organisational capabilities (including technology and human
resources) will enable production and knowledge-intensive services to
achieve greater competitiveness (Khatri et al., 2010; Perez-Arosegui et al.,
2012). In the first place, this competence requires the ability to coordi-
nate technology and human resource systems in a way that is aligned
to the overall objectives of the organisation i.e. into a coherent and
meaningful whole. But in addition, complementarity will add the
prospect of synergies with other areas, some of which will have been
envisaged by original planning processes and some of which will not.
Both will require integration competences on the part of the leader or
manager as they develop systems to deliver progression through cre-
ating a competitive strategy and operations. Innovation and improve-
ment through complementarity will become a continuous cycle once
integration is successful.
These four areas might be considered to be core management compe-
tences. In the Fourth Industrial Revolution they will inevitably have their
130 P. Turner
foundations in technology, that is the ability not only to integrate tech-

nologies into particular spheres of responsibility but also to seek and dis-
seminate knowledge that may benefit other areas or domains and
ultimately the whole organisation. It is this holistic perspective that is the
added dimension of complementarity and extends competences beyond
their traditional boundaries.
he Role of Leaders and Managers

T
in Delivering the Potential of Complementarity
Having identified some of the competences that may be present in lead-
ers and managers, the question remains as to exactly how such compe-
tences will be demonstrated to produce coherent, aligned and mutually
reinforcing systems and processes that give superior outcomes over those
that would occur if such strategies or practices had taken place indepen-
dently of one another. For the subject of leadership and management this
means the qualities of leadership and the qualities of management, when
combined, produce more than the sum of the qualities of leadership or
the qualities of management as singular instances. It also means that the
qualities will be applied in ways that are specifically targeted towards
complementarity benefits or objectives.
Performance remains as the focal outcome (Bruning et al., 2020) and
includes four considerations. First, how can leaders and managers both
participate in and facilitate collaborative, cross domain working that
ensures the sharing of knowledge that will benefit the whole organisation.
Second, what will be the criteria by which they allocate resources. Third,
how can they ensure that systems and processes are integrated and work
for complementarity. And finally, how can they exploit any social com-
plexities that exist in the organisation’s resource base to create advantage.
• Participating in strategy setting in a collaborative way-cross domain
Strategy setting will be increasingly a cross domain process demanding

more participation, collaboration and knowledge sharing. This is rein-
forced by a demonstrated and significant relationship between participa-
tive leadership and a process which includes the integration of factors
such as marketing or manufacturing with information systems capabil-

ity—resulting in higher levels of performance and positive business out-
comes. Leaders and Managers have a clear responsibility for ensuring that
these links are facilitated by participating in strategy setting in a way that
enhances the possibility of coherence, congruence and consistency as
described earlier. To do so means that they will not only develop strategy
from the perspective of their own domains—though this remains their
priority—but will also seek to deliver additional potential, through col-
laboration with colleagues and peers, areas where complementarity is a
possibility. Leaders and managers will act as fulcra between teams by
looking for opportunities to bundle strategies and actions in such a way
as to deliver over and above what those strategies and actions would have
delivered if they had taken place independently of one another.
The incidence of new forms of organisation structure or self-managed
teams does not diminish the role of leadership and management. Even
those organisations motivated to increase egalitarianism and participa-
tion among peers within complex task groups may need to maintain
adequate forms of formal leadership, possibly combining sufficiently
directive formal leadership behaviour with initiatives that encourage
individual members to voice their ideas, views, and opinions’ (Bharadwaj
et al., 2007; Cohen & Olsen, 2015; Oedzes et al., 2019; Ali et al., 2020).
Strategy setting provides the foundation for complementarity; resource
allocation provides the building blocks for its delivery.
• Allocating resources to enhance the possibility of

complementarity
Complementary resources, for example, between the technology

knowledge of computer engineers and the customer knowledge of mar-
keters, or in systems and processes, between IT infrastructure capabilities
and e-business capabilities, may lead to better overall performance out-
comes when combined than if only one is present or they are managed
independently, producing positive effects on sales growth and stock mar-
ket returns (as in the case of mergers and acquisitions). Likewise, organ-
isations that combine superior technology capabilities with other
resources available to them can create agility in response to market trends
and prompt innovative behaviour in developing digital platforms on
132 P. Turner
which to base competitiveness. How to achieve such complementarities

will be high on the agenda of leaders and managers in both strategic and
operational roles. This means influencing the orchestration of resources,
the way in which they are bundled and the way they are used to leverage
the value of resources at multiple levels and organisation wide. The suc-
cess of and the ability to create value is not only dependent on the theo-
retical complementary fit between resources but also on the behaviour of
the receivers of the resources. If it is to be effective, the resource manage-
ment activities of leaders and managers at all levels of the organisation
should be prioritized, synchronized, and supported—that is, orches-
trated—managerial choices and orchestration efforts lead to synergies
(Woo, 2006; Nakata et al., 2011; Crocker & Eckardt, 2014; Soda &
Furlotti, 2017; Ravichandran, 2018; Uwizeyemungu et al., 2018;
Schweiger et al., 2019; Dellestrand et al., 2020). The challenge will be in
identifying mutually reinforcing combinations of factors or activities for
multiplier rather than simple additive effects. The ability to do so will be
in part tacit and in part explicit competence. Having the right systems in
place, which are operationalised for complementarity activity will be
critical.
• Ensuring systems and processes are integrated and work for

complementarity
Integrating distributed systems or organisational knowledge into

actionable, competitive, and innovative strategies are essential aspects of
management and where practices are aligned, complementarities can
occur. Hence, systems integration is seen as an important competence at
the organisational, leadership and management levels. Where effective it
is a powerful driver of value creation not only through business—as usual
activity but also with the possibility of a complementarity effect. This can
produce a strong positive interaction between, for example, technology
infrastructure and ‘front end’ capability—such as e-commerce. Evidence
suggests that their complementarity ‘positively contributes to firm per-
formance in terms of sales per employee, inventory turnover, and cost
reduction through complementary synergy,’—between systems integra-
tion and such outcomes as innovation or effective solution design. As
systems and processes are integrated then this will facilitate the sharing of
resources between separate units, from which it will be possible to increase

strategic capabilities leading to flexibility or faster time to market.
Furthermore, knowledge management strategies, where successfully inte-
grated into business processes, can create ‘super-additive value synergies’
that are not captured by stand alone strategies. The maximisation of such
value will depend on an integration process which includes communica-
tion, shared understanding, demonstration of management commitment
and effective evaluation. There is a strong business case for a leadership
and managerial focus on integrating systems and processes to ensure their
maximum contribution (Nakata et al., 2011; Ceci et al., 2014; Vermerris
et al., 2014; Kim et al., 2021). This aspect of leadership and management
goes beyond the essential task of alignment. Instead, leaders and manag-
ers will seek integration opportunities that go beyond those envisaged in
the day-to-day operational mode. To identify such integration opportu-
nities will require both knowledge and agility.
• Exploiting social complexity
Social complexity is based on human dynamics and includes the nature

of interpersonal relations, a distinctive culture and the higher-order capa-
bilities of competencies for creating, capturing, and transferring knowl-
edge. Any organisation comprises of a network of individuals, and that
those individuals will have unique talents or behaviours that will deter-
mine the level to which these attributes are used positively. How they do
so will be derived from social networks—complex systems characterised
by many ‘dynamically interconnected component entities.’ The way in
which these interconnections utilise talents or behaviours that are diffi-
cult to imitate and can be combined with other rare or inimitable
resources, will be instrumental to competitive progression. It will be a key
role of leaders and managers to exploit such complexities in the pursuit
of their objectives. The outcome would be that combinations of these
socially complex attributes which yield benefits over and above those that
each element could generate on its own. Simply put, ‘a certain degree of
fit or match among the organisational practices and technologies in place
is required to achieve superior performance’ (Milgrom & Roberts, 1990;
Barney, 1991; Potgieter et al., 2007; Stucki & Wochner, 2019).
Maximising this potential requires leaders and managers first to
134 P. Turner
demonstrate that they can engage the workforce with the task in hand,
second that they can create an organisation design and structure that
facilitates the practice of complementarity and third that they are adept
in sharing knowledge and practices that may enhance cross organisational
performance. Knowledge can be used to generate valuable solutions that
are hard to imitate and replace and knowledge sharing is important
‘because it connects individual knowledge with organisational knowl-
edge’ allowing units to influence each other through their experiences to
create new knowledge (Balle et al., 2020). This means not only knowl-
edge collection but knowledge dissemination and exploitation through
effective collaboration.
This will depend on how the workforce is organised with an orienta-
tion toward making progress on agreed or set goals as well as critically
evaluating alternatives. Management style will shape group members’
thoughts and behaviours in a way that increases group potency in both
regards. Leader/manager team complementarity can benefit performance
through task driven/motivational processes which will in turn lead to
increased team potency because of shared beliefs that the team can per-
form successfully. The benefits of such an environment will manifest
themselves through changes in ‘groups’ perceptions of joy, happiness,
enthusiasm, and optimism,’ which in turn have the potential to improve
performance outcomes (Hamstra et al., 2014; Hu & Judge, 2017;
Bruning et al., 2020). Such configurations of leader and manager
behaviour and group potency will foster positivity in the working
environment, as well as the group's sense of competence and
self-determination.
Social complexity, its identification, its rareness and its inimitability
are possible sources of competitive progression if it can be harnessed in
such a way and combined with other rare resources in the creation of
strategy and practice, to deliver complementarity benefits. The actions of
leaders and managers will be instrumental in so doing. Using behavioural
competence in engagement and structural competence in knowledge
sharing or organisation design, their actions will determine the extent to
which theoretical recognition of the value of social complexity is con-
verted into the practice of business results.
Conclusion
The success of an organisation’s strategy will depend in large part on the
abilities of its leaders and managers. Traditionally these abilities were seen
either as separate with clear boundaries between the roles of a leader and
a manager articulated in the phrase that leaders did the right things whilst
managers did things right. More recently there has been debate—still
unresolved—that it was not entirely possible to separate the two roles.
Conventionally leaders have to be effective at management practice if
they are to be successful in their roles whilst managers have to lead to
deliver their objectives. In support of this assertion there is evidence that
a failure in basic management actions to implement compounded by
poor execution have undermined many a grand leadership vision. A lack
of understanding of the organisation’s dynamics and a risk averse culture
can likewise impede performance. And so, whilst leaders and managers
will rarely be excellent in all aspects of their roles, separating the two in
the contemporary organisation appears to be less credible. A complemen-
tarity in the roles means that vision and action go hand in hand; that
strategy and implementation are aligned. Hence the first aspect of com-
plementarity in leadership and management concerns the competences
in the role. As outlined above, these centre on four key areas namely agil-
ity, collaboration, engagement and integration. A leader’s competences
include those of a manager and a manager’s those of a leader.
The second area in leadership and management functions concerns
how those competences are applied in practice and with the objective of
complementarity as their foundation. Cross domain and more inclusive
setting of strategy and the subsequent allocation of resources to fulfil
potential add to those actions that traditionally fill the daily lives of lead-
ers and managers. Recognising the importance of ensuring that systems
and processes are not only integrated but their potential and effectiveness
span organisational boundaries. Acquiring and disseminating knowledge,
tapping into the unique skills of the workforce, and converting these into
advantage and progression or exploiting the uniqueness of the organisa-
tion’s design or culture feature heavily.
136 P. Turner
It is towards this latter point that the next aspect of complementarity

applies and that is in relation to the organisation’s talent and how to
ensure that this is fully engaged with what the organisation is trying to
achieve, both in its mission and vision and in the contribution of comple-
mentarity to their achievement.
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6
Complementarity in Talent
and Workforce Engagement
People Issues Are Business Issues

The higher the incidence of the collective interactions of a fully engaged,
talented workforce, the greater the chances of producing superior results
from complementarity. The objective is to generate value through syner-
gies over that which would be realised if practices had taken place inde-
pendently. A contributor to this will be where systems and processes
allow members of the workforce to engage in strategy and action and to
enhance both by their knowledge and collective problem solving.
Underlying the realisation of the anticipated positive outcomes will be
talent management and workforce engagement. When technological
advancement and a workforce engaging in problem solving or perform-
ing creative tasks come together, they can deliver complementarity in
‘complex, dynamic ways’ (Crocker & Eckardt, 2014; Barmeyer &
Franklin, 2016; Collings et al., 2018; Burdin & Kato, 2021; Kim et al.,
2021; Pedota & Piscitella, 2021). The essence of this argument is:
the activities of talent management, when combined with and complementary

to the activities of employee engagement, produce more than the sum of the
benefits of each when treated as singular events.
https://doi.org/10.1007/978-3-031-10654-5_6
144 P. Turner
In this context, employee engagement refers to an individual; and

workforce engagement applies to the totality of employees in an organisa-
tion. Talent management can be interpreted as exclusive, inclusive, or
pluralistic in nature. The complementarities will occur between the two
functions and between these and organisational performance.
People issues are business issues. Strategic HRM research supports this
point of view and emphasizes the positive effects of high-performance
work systems on organisational level outcomes such as productivity,
innovation, and financial performance—where changing a ‘broad suite’
of HRM practices impacts on performance through productivity. Human
resource practice combinations are instrumental as coordination mecha-
nisms in knowledge creation and exploitation. However, in addition to
being a repetition of best practice, a complementarity approach to people
related work systems will seek to exploit heterogeneity—those human
resource practices that are difficult for competitors to imitate. From a
resource-based view, this offers the opportunity to apply unique people
management practices and experiences to deliver performance over and
above that of competitors (Laursen & Mahnke, 2001; Fabling and
Grimes, 2014; Bartoloni & Baussola, 2018; Chadwick & Flinchbaugh,
2021). The challenges are how to identify aspects of human resource
practice that are unique and having done so deciding on what combina-
tions are advantageous. The answers to these questions will allow the
organisation to decide how the areas of talent, talent management and
workforce engagement can contribute most effectively; that is under-
standing how talent management as being simultaneously ‘exclusive’ and
‘inclusive’ can be incorporated into the new paradigm; and how the psy-
chological, sociological, and organisational aspects of workforce engage-
ment can be accommodated into such an approach.
Defining Talent and Talent Management

Karl Schwab (2016) has written that ‘in the future, talent, more than
capital, will represent the critical factor of production.’ Talent is a valu-
able and rare resource and there are compelling reasons why it has
assumed a significance in management practice. Talent can be a driver of
6 Complementarity in Talent and Workforce Engagement 145
value creation, of higher shareholder returns, for investor confidence,

brand recognition, and customer relationships, commitment, and mar-
ket share. It is perhaps because of the perception of these many perceived
benefits that talent remains one of the key challenges for organisations
worldwide in a dynamic and volatile market environment. To be effective
requires a response that is both quantitative and qualitative—the right
people in the right place, with the right skills at the right time. Clarity
about what talent means to the organisation, who has it and how best to
manage talented people are important antecedents to developing a talent
strategy. The logic behind this assumption is that a clear definition will
inform how to allocate resources to ensure they are pivotal to enterprise
success. It would provide the foundation for an organisation wide
approach to talent. And would give coherence to talent management
since the quest for complementarity will require the development of
appropriate systems and processes aligned to the achievement of enhanced
objectives. But a definition of what is meant by the term, has been the
subject of much debate within both academic and practitioner circles
(Lewis & Heckman, 2006; Dries, 2013; Meyers & van Woerkom, 2014;
Collings et al., 2015; Cascio & Boudreau, 2016). Talent is variously
viewed as human capital, individual difference, giftedness, identity,
strength, or perception.
For example, talent was defined by the Chartered Institute of Personnel
and Development, as ‘those individuals who can make a difference to
organisational performance either through their immediate contribution
or, in the longer-term, by demonstrating the highest levels of potential’
(Tansley et al., 2007). But, interpretations have also been couched in
terms of natural ability or mastery of a particular function, as well as by
competences, capabilities and commitment. There is also the question of
whether talent is the result of nature or nurture; and whether it is innate
or whether it can be taught and developed. There was the view that talent
emerges from the transformation of individual aptitudes to systematically
developed skills and that this was most likely a combination of cognitive,
affective and conative traits that ‘in turn, determine the direction, inten-
sity, duration and effectiveness of practice/learning’ (Huselid et al., 2005;
Ulrich & Smallwood, 2011; Björkman et al., 2013; Ackerman, 2014).
The many variations of the definition provided a wealth of material but
146 P. Turner
didn’t resolve the paradox of whether those who could ‘make a difference’
were those at the top of the organisation (and where talent management
was directed to this group known as an ‘exclusive’ approach), or all
employees (where talent management was targeted in this way, known as
an ‘inclusive’ approach). A summary of the questions raised by studies of
talent and talent management is; ‘does talent refer to people (subject) or
to the characteristics of people (object)? Is talent more about perfor-
mance, potential, competence, or commitment? Is talent a natural ability
or does it relate more to mastery through practice? Is it better to take an
inclusive or an exclusive approach to talent management?’(Gallardo-
Gallardo et al., 2013).
The definition of talent appears to be largely phenomenon rather than
theory driven, and this has implications for what is included within the
boundaries of talent management and the operation of talent systems and
processes. Definitions cover those typical human resource practices, func-
tions, activities or specialist areas such as attraction, selection, develop-
ment, and career management, or the creation and development of talent
pools (Lewis & Heckman, 2006). On the one hand talent management
can be ‘all organisational activities for the purpose of attracting, selecting,
developing, and retaining the best employees in the most strategic roles—
those roles necessary to achieve organizational strategic priorities’ (Vaiman
et al., 2012); or the activity which systematically utilised HRM policies to
attract, develop, and retain individuals with high levels of human capital
(e.g., competency, personality, motivation) consistent with the strategic direc-
tion of the organisation in a dynamic, highly competitive environment
(Tarique & Schuler, 2010). Collings and Mellahi (2009) articulated it as
the process for the identification of key positions which significantly con-
tribute to competitive advantage, the development of talent pools to fill
such roles, and a human resources architecture geared to filling these
positions; a definition which emphasized so called pivotal positions. A
more inclusive stance towards talent management would have a greater
emphasis on focussed competence development concentrating on talent
flows, and from a social capital perspective taking account of contexts
and relationships as well as human capital.
So, talent may refer to the most senior roles in the organisation, and
here the priority would be to make sure that succession plans are in place
and there are enough people at the right level to lead and manage the
organisation. Talent management would be concerned with leadership
potential, and their development and retention—often referred to as the
‘exclusive’ approach At the other end of the spectrum, there may be a
more inclusive approach, where ‘everyone has talent’ and talent manage-
ment extends throughout the organisation with a possible remit to create
an employee value proposition for career and professional development
opportunities for a broad swathe of employees. Some organisations take
a pluralistic view about talent management which contains elements of
both exclusivity and inclusivity, ‘focuses on organisational needs such as
effective and sustained leadership (people and roles); but at the same time
seeks to satisfy individual needs through employee engagement and the
provision of career opportunity to the majority’ (Swailes et al., 2014;
Turner, 2017).
A conclusion from the vast amount of research and practice evidence
is that there are too many factors to synthesize talent or talent manage-
ment into a single approach. It is for these reasons that demographic,
behavioural and attitudinal forces have created a shift to a more pluralis-
tic outlook. And so, where once approaches were framed in the context
of senior managers and high potentials, there is now a perspective that
increasingly embraces both exclusive and inclusive positions, often simul-
taneously. Increasingly, talent management is likely to include both lead-
ership development and whole workforce development; designing career
paths for board level successors whilst enabling the career progress of the
majority of the workforce; and a range of activities to ensure that reten-
tion underpins organisational development and culture. The greater the
integration of these activities with business or organisational objectives,
strategies and culture, the closer the organisation will be to a high perfor-
mance organisation (Turner, 2017).
The various philosophies about talent and talent management that
have evolved over the past two decades and beyond are not competing
approaches because they ‘reflect different and alternative dimensions of a
more strategic approach to talent management. Each philosophy makes
different contributions to the potential study of the value of talent man-
agement’ (Sparrow & Makram, 2015). Talent management is a mix of
science and art—the science being derived from psychology, sociology
148 P. Turner
and organisational dynamics and the art from engaging executives, man-
agers, and the whole workforce. These factors and the importance of con-
text suggest that organisations choose a best fit approach to go down a
path of what is right for them in their particular circumstances. The effec-
tiveness of this best fit will be crucial in determining whether an organisa-
tion is able to maximise returns from complementarity. Where a definition
is ‘exclusive’ i.e. referring to the most senior leaders or managers and
those in talent pools, resource directed towards complementarity may
well be in learning, training and development ensuring that those in the
most senior positions have the strategic competences and awareness rel-
evant for achieving complementarity goals and objectives. Where talent
management is of a more inclusive hue, then resources will still be directed
towards learning, training and development but with an emphasis on
team working and collaboration.
Talent management is a mix of science and art—the science being derived from
psychology, sociology and organisational dynamics and the art from engaging
executives, managers and the whole workforce into the practice of talent
management.
At its most strategic, Business or Organisation Integrated Talent

Management is used to drive organisational performance and is a board
level agenda item—influences the direction of the organisation. Moreover,
talent management is likely to be pluralistic with multiple communities
and objectives.
The same assumptions are true for the subject of employee or work-
force engagement.
The Significance of a Fully Engaged Workforce

The performance of the workforce is a critical determinant of operational
and strategic outcomes and hence there is a strong rationale attached to
the importance of workforce engagement. This is accentuated by the
people management challenges of the confluence of technologies accom-
panying the Fourth Industrial Revolution or approaches to work as a
result of the global pandemic. The results are new business models,
changes in the type of work available, a requirement for new skills and
innovative approaches to organisation, interaction, and communication.
Recruiting, developing, motivating, and retaining employees with the
right level of skill in the right place at the right time remain priorities. A
combination of more traditional approaches and new requirements will
reinforce a core management competence of engaging and developing a
workforce, which is ‘the ability to create a positive working environ-
ment and inspire individuals to apply themselves with intelligence,
energy, resilience, enthusiasm and concentration; whilst providing the
means for their personal and professional development’ (Turner, 2020).
This applies at an individual (employee) level of engagement and of the
workforce as a whole.
Achieving such a lofty goal is not, however, a straightforward task
because workforce engagement is a complex, multi-faceted concept. The
question of why employees are enthusiastic and will engage with their
job, team or organisation is one that has exercised academics and practi-
tioners over time from Kahn’s (1990) ground-breaking research which
articulated the concept of workforce engagement as how employees ‘har-
nessed’ themselves and their roles through the application of their physi-
cal, cognitive, and emotional resources whilst they were at the place of
work; to Schaufeli and Bakker’s (2004) conceptualisation of engagement
as a positive work-related state characterized by vigour, dedication, and
absorption—where vigour concerns energy and resilience, dedication is
about enthusiasm and being inspired, and absorption is the intense con-
centration in the work being undertaken. From this perspective, employee
engagement can be seen as the simultaneous employment and expression
of a person’s ‘preferred self ’ in task behaviours that promote connections
to work and to others, personal presence (physical, cognitive, and emo-
tional), and active, full role performance (Saks, 2006, 2017). Other defi-
nitions include those of organisational engagement—the level of
employee commitment to the organisation; work engagement-a positive,
fulfilling, work-related state of mind; job engagement—the level of com-
mitment to the job or role; cognitive engagement-how an employee
understands their job; physical or behavioural engagement—effort, per-
formance, or productivity; personal engagement—the harnessing of self
150 P. Turner
to work roles; and social engagement or how engaged individuals interact

with colleagues and co-workers to propose and implement new ideas.
employee engagement is a positive work-related state characterized by vigour,

dedication, and absorption.
The Jobs-Demand-Resources theory has traversed multiple definitions

which brings together many of the concepts as it models all working
environments or job characteristics on two categories, namely job
demands—physical, psychological, social, or organisational aspects of the
job that require sustained physical or psychological effort; and job
resources—physical, psychological, social, or organisational aspects of
the job that are functional in achieving work goals; reduce job demands
or stimulate personal growth, learning, and development (Bakker &
Demerouti, 2014). The theory has implications for the level of engage-
ment of an individual member of the workforce and for the workforce as
a whole.
The level of interest in employee or workforce engagement is explained
in part by the attributed benefits that accrue to those organisations and
individuals where engagement is high. These include impacts on share-
holder returns, operating income, revenue growth, profit margins, cre-
ativity and innovation and customer or client satisfaction for the
organisation and well-being for employees. Workforce engagement is
clearly a priority, accentuated by new demands and opportunities. To
maximise the benefits of such opportunity will require a workforce that is
engaged with the role, the team and the organisation with the skills rele-
vant to the work that is required. They will need to be resilient on the one
hand and to employ their skills to maximum effect on the other in a
context where employee engagement is influenced by both individual
and circumstantial elements. First, in the psychology of work which will
include meaning at work, no fear or blame, emotional presence, emo-
tional intelligence and positive mutual regard. Second, the sociology of
work will include organisational climate and culture, work demand and
resource supply, health and well-being and the physical work environ-
ment. Whilst third, the organisation of work will include the structure,
organisational dynamics, and the impact of technology (Turner, 2020).
Developing strategies and plans for each of these three areas will be
important for organisations as they seek to increase levels of engagement
in their workforces.
In summary, and in an ideal scenario workforce engagement is most
effective when it takes place in the context of a people strategy that is
aligned to business strategy; including the fair treatment of employees
and support for their well-being; empowering employees to shape their
roles; processes for two-way communication; leaders and line managers
with engagement as a priority in their people management skills; effective
and motivational performance management systems, whole workforce
talent management, opportunities for professional development and HR
practices that address and value inclusivity. Complementarity provides an
opportunity to exploit the outcomes of this scenario by addressing the
question—are there ways in which talent management and workforce
engagement can be coordinated such that they produce higher levels of
return than if they had been addressed as individual concepts? There is
significant potential for complementarity benefits between talent man-
agement and workforce engagement on the one hand and between the
two and organisational performance on the other.
omplementarity Between Talent

C
Management and Workforce Engagement
Ability and effort are complements thereby reinforcing links between
human resource practices (Bonatti & Hörner, 2017). Both areas can be
addressed by bringing together approaches to or strategies for talent man-
agement and workforce engagement. These will be at the individual level
where inclusive talent management will have a knock-on effect on the
psychology of work—individuals will perceive a strong link between their
personal goals and opportunity to fulfil them; and the sociology of work
where employees will feel attuned to their roles within teams by being
trained to fulfil that role on the one hand whilst developing the compe-
tence associated with collaboration and knowledge sharing on the other.
In addition, effective talent management can have an impact on the
organisation of work—a third driver of employee engagement—where
152 P. Turner
the employee will feel a strong affinity to the organisation, its culture and
its goals by effective onboarding, day to day management and career
paths or development opportunities. Where talent management includes
employee engagement as a critical aspect of its purpose, there may be
complementarity benefits over and above those that would occur if talent
management took place as an independent, stand-alone human resource
discipline. Likewise, where employee and workforce engagement not
only draw on the outputs of talent management but also inform its pri-
orities, direction, and content then there is the possibility of additional
benefits over and above those that would occur if they had been treated
as separate strands in HRM. Changes that are taking place as a result of
the Fourth Industrial Revolution and Industry 4.0. are important consid-
erations in determining both.
New business models, new types of work, a requirement for new skills
and innovative approaches to organisation, interaction, and communica-
tion are forcing a rethink about the nature of work. Recruiting, develop-
ing, motivating, and retaining employees with the right level of skill
continue to be priorities, but there are additional elements to the ‘human
dimension’ of work that are relevant to complementarity. This is because
delivering through mutually beneficial cooperation—the day-to-day life
in the organisation—will increasingly depend on such things as knowl-
edge creation, dissemination and exchange, joint actions to solve prob-
lems, joint planning for work-flow, making joint decisions and
committing to collective behaviour, i.e. action whose outcome depends
on cooperation based on shared understanding. Furthermore, coopera-
tive capabilities—competencies relevant to information processing, com-
munication, knowledge transfer, intra- and interunit coordination, the
ability to develop trusting relationships, and negotiation, have the poten-
tial to create competitive advantage that is not easily imitated. Where
these interactions are effective and when organisational practices, systems
and processes work together with a complementarity focus, they can cre-
ate a productivity premium over and above that where practices were
implemented separately. Such dynamic capabilities facilitate taking new
business opportunities and creating opportunities for additional value-
creating strategies.
The evidence of the complementarity between the two is often included

in more general arguments i.e. where organisations are able to provide an
environment in which human resources practices can be coordinated and
combined, there is potential over and above that which would have
occurred in individual human resource practice circumstances. Internal
fit, cultural fit and strategic fit are important factors creating an inimita-
ble system of practices (Stahl et al., 2012; Baltrunaite et al., 2021). The
quest to ensure ‘fitness’ may indicate where complementarities between
talent management and workforce engagement are present:
• At the highest level of awareness, talent management is used to drive

organisational performance; it is a board level agenda item; and it
influences the direction of the organisation. Similarly, workforce
engagement is regarded as a significant contributor to organisational
performance. The challenge of complementarity is to ensure that sys-
tems and processes are in place to identify and deliver any synergies
that may exist and converting these into benefits that accrue over and
above those that would be present if the two areas were treated as sepa-
rate aspects of human resource management. If the strategies were
integrated there are opportunities for synergy derived from econo-
mies of scope.
• One of the most effective tools in ensuring that employees stay engaged
and committed to their work is talent management. Hence, ‘a syn-
chronization of talent management practices and employee engage-
ment initiatives leads to improved talent retention’ such that talent
management and employee engagement have a positive and significant
relationship (Pandita & Ray, 2018; Yuniati et al., 2021). The two can
be mutually reinforcing—talent management can have a significant
impact on workforce engagement levels; workforce engagement strate-
gies have the potential for attracting and retaining talented people.
• There is a strong relationship between talent management practices,
employee engagement and employee retention such that talent man-
agement practices are positively correlated to employee engagement
and that employee engagement has positive correlation with employee
retention (Alias et al., 2014).
154 P. Turner
• Where talent management is pluralistic with multiple communities

and objectives, it gives the opportunity to overlap approaches to work-
force engagement. The development of career paths (career ladders,
executive or personal coaching, funding for qualifications) within the
talent management domain can have a significant impact on how
members of the workforce regard the organisation and their commit-
ment to its objectives. There are overlaps between this aspect of talent
management and that of workforce engagement.
• The objective of fusing inclusive talent management in the context of
improving employee and workforce engagement, will be facilitated by
creating an environment whereby the expectations of employees are
understood and met. The result will be tangible outcomes (return on
investment in talent) and intangible ones (motivated and engaged
employees or increase in the value of intangible assets such as corpo-
rate reputation or Intellectual Property.) The maxim that ‘everyone is
important. Make talent important for everyone’ (Caplan, 2011) means
focusing on the individual development of all employees. This is a
powerful antecedent of employee engagement. The opportunity is to
build talent management and employee engagement strategies syn-
chronously. Where this is achieved—cultural fit—there is potential to
differentiate against competitors in terms of converting high engage-
ment levels to output and productivity. This can contribute to the
social complexity discussed earlier and make human resource practices
difficult to imitate on the part of competitors.
• Organisational learning facilitates the development of cognitive and
behavioural skills, ‘which can lead to profound, lasting modifications’
to how the organisation operates—strategic fit. Because strategies for
learning, training and development have taken on a more inclusive
hue, in which a whole workforce approach is as much of a priority as
that towards ‘top talent’—inclusivity is considered as an essential ante-
cedent of workforce or employee engagement and thereby organisa-
tional performance. Career planning along with incentives and
organisational support are important aspects of talent management
that are critical to engagement and in turn retention (Bhatnagar,
2007). Workforce engagement relies on effective talent management;
and together they can be mutually performance enhancing.
• The effective transfer of training improves engagement with a particu-

lar role or team which in turn improves performance. This applies to
training and development for individuals and operational teams with
knowledge and skills for specific roles or tasks; specialists in particular
areas of the value chain—sales, marketing, procurement, finance or
HR—and architects able to negotiate complex social, economic and
political environments through innovation. Progressive organisations
are continuously seeking ways to increase effectiveness through devel-
opment of the workforce and the transfer of training through rapid
digital adoption and different modalities and content. To maximise
this potential will require both a strategic response—crafting strategies
that enhance the potential for synergies between talent and workforce
engagement—and the effective operationalisation of these initiatives.
The additional factor of complementarity may require a change in

approach since it is both a characteristic of and integrated into human
resources strategies informing aspects of talent and engagement including
recruitment, career management, learning training and development. A
strategic approach will not only bring together the management of
human capital with the goals and objectives of the organisation but also
with the objective of complementarity. It is part of ‘Business Integrated
Talent and Engagement,’ which is strategy driven. The value of combin-
ing system-oriented strategies with person-oriented strategies is higher
than that of using the strategies in isolation (Harrison et al., 2001; Kim
et al., 2021). In this regard, the priorities of talent management and
workforce engagement are aligned to both organisational strategy and
potential complementarities.
Successful talent management and workforce engagement will create
an environment of learning which if it is to be meaningful will require
knowledge articulation and knowledge codification. The objectives of
complementarity for talent and workforce engagement will include maxi-
misation of a knowledge portfolio—an intentional combination of indi-
vidual knowledge management strategies to capture the benefits of
multiple knowledge scopes and types (Laaksonen & Peltoniemi, 2018;
Kim et al., 2021).
156 P. Turner
omplementarity Between Talent

C
Management, Workforce Engagement
and Organisational Performance
There is a positive relationship between talent management, workforce
engagement and organisational performance. Employees who are engaged
and committed can achieve higher productivity and are less likely to
leave. But to arrive at this position requires a combination of factors
including a mix of strategic (mission, vision) and operational (values and
behaviours). Vital to this are leaders with the competences to deliver and
leadership actions that do so; managers who regard engagement as a key
part of their role and a fully developed workforce. Where these elements
are in place then there is the possibility of complementarity benefits
(Jackson & Ni, 2013):
Stakeholder theories suggest complementarities between corporate governance

characteristics of ownership and boards, on one hand, and employment pat-
terns, on the other. For example, commitment by relational investors supports
stable long-term employment, investment in worker training, and cooperative
industrial relations.
To reach high performance levels through talent management an

organisation should also focus on creating an appropriate climate sup-
porting the individual creativity of its employees. Workforce engage-
ment and talent management are intertwined and there is an incentive
for the organisation to create an environment and culture conducive to
this partnership. In so doing the complementarities will be greater moti-
vation, commitment and enthusiasm for jobs or work, whilst at the same
time ensuring alignment with the values of the organisation, and ‘well
informed and well-integrated’ teams. This will have a knock-on effect on
productivity.
Conventionally, it is common to link talent management or workforce
engagement practices directly to the organisation’s performance. The
assumption is that the effect was due to enhancing human capital
resources in their most general sense. Hence, when most human resource
research refers to complementarities, it is essentially focussing on those
that may exist among the talent management practices rather than the
resources that are influenced by those practices. An alternative perspec-
tive would be to consider enhancements in business performance not as
the result of activities within a singular domain but the activities of that
domain in relation to others. A definition that embraces this perspective
is that complementarities in human capital resources result from syner-
gistic relationships between two or more human capital resources (Jeswani
& Sarkar, 2008; Ingram, 2016; Ployhart & Cragun, 2017). Since the
performance of the workforce will be a strong determinant of both opera-
tional and strategic outcomes, there is a powerful rationale behind the
importance of talent management and workforce engagement.
The probability of successful outcomes for both the individual and the
organisation will increase where there are direct linkages between talent
management, human resources development and human resource man-
agement—in particular workforce engagement. Where those who are
regarded as talent—whether this be in an exclusive, inclusive or pluralis-
tic definition—also have a high level of commitment, then this has the
potential to increase engagement and add value in the organisation in a
variety of beneficial ways (Turner, 2017; Ramli et al., 2018). Some would
go further since research has shown that whilst talent management repre-
sents one of the most important functions affecting competitive advan-
tage achievement, this will be most effective when talent management is
aligned with corporate and business strategy, as well as being coordinated
with other functions of which workforce engagement can be regarded as
important (Abrahamson, 1973; Dryer & Horowitz, 1997; Fiske, 2000;
Tyler, 2001; Aral et al., 2012; Laaksonen & Peltoniemi, 2018).
A combination of talent and workforce engagement can have comple-
mentarity effects on aspects of the business environment from productiv-
ity through to innovation through to knowledge creation and capture.
• There is a relationship between managerial talent, employee engage-

ment, and business-unit level performance. There are two critical areas
that can improve the probability of business-unit level success; select-
ing managers with the talent to manage people efficiently and creating
an environment that supports employee engagement. ‘Together these
factors explain complementary and unique variance in business-unit
158 P. Turner
level performance within organisations’ (Harter, 2000). Furthermore,

there is a positive relationship between talent management and engage-
ment and the ‘triple bottom line’ of environment, society and econ-
omy (Alhaddi, 2015). Seeking complementarities and facilitating their
delivery through a combination of talent management and workforce
engagement has the potential to satisfy multiple organisational
objectives.
• The relationship between workforce engagement and performance at
the business/ work unit level continues to be substantial and highly
generalizable across companies. Gallup’s, 2020 survey found that those
organisations with higher engagement scores showed differences
between top and bottom quartile organisations of 10% in customer
loyalty and 23% in profitability, as well as 18% in productivity (sales);
18% in turnover for high-turnover organisations (those with more
than 40% annualized turnover) 81% in absenteeism; 41% in quality
(defects); 66% in wellbeing and 13% in organisational citizenship
(Gallup, 2020). This study raised two important questions that are
both influential and directly related to talent management. These con-
cerned career discussions and ‘opportunities at work to learn and
grow.’ Linking talent management attributes to workforce engage-
ment can have positive organisational outcomes. And where organisa-
tions were able to configure their human resources with other
competitive resources—such as technology—there was a strong pos-
sibility of high performance. Effectively implemented talent manage-
ment and enhanced workforce engagement can be strong predictors of
positive organisational performance (Hughes & Rog, 2008; Markos &
Sridevi, 2010; Aversa et al., 2015).
• Amongst the benefits of effective talent management are greater com-
mitment, well-being, favourable turnover intentions and fairness. It is
argued that if talent strategy is to succeed, then those responsible will
have to achieve credibility with business leaders. They will do so by
having a dialogue around the strategic agenda and how talent can sup-
port the delivery of business goals. Talent has been identified as a driver
of value creation; more talent, better shareholder returns and potential
outcomes in respect of market value; better p/e than competitors,
community reputation—brand recognition and impact; Business exe-
cution—ability to implement new strategy; Customer commitment

and share (Ulrich & Smallwood, 2011). Complementarities from tal-
ent management and workforce engagement include the creation and
dissemination of knowledge more effectively than if the two activities
were separate. There was evidence of additional benefits where human
capital and knowledge management capabilities interacted to influ-
ence customer service outcomes (Alma’aitah et al., 2013; Cohen &
Olsen, 2015).
• The value of whole workforce training and development to business
innovation. Improvements in on-the-job productivity; improvement
in customer satisfaction; reduced time away from the job; and greater
levels of engagement are the result of the offer of training and
career progress.
The above discussion had two areas of focus. First to show the poten-
tial of identifying and exploiting synergies between talent management
and employee or workforce engagement; second to demonstrate that hav-
ing done so, the resulting approach would impact positively on organisa-
tional outcomes. The achievement of these desirable objectives however
will also require recognition of the potential for complementarity and
strategies and actions to deliver them.
eveloping Talent Management

D
and Workforce Engagement
to Achieve Complementarity
Whilst complementarities between talent management and workforce
engagement and between talent management, workforce engagement
and organisational performance can happen spontaneously, it is impor-
tant to have strategies, implementation plans and ways of capturing per-
formance outcomes through synergies or economies of scope. From the
former these will be improvements in talent metrics from attraction to
recruitment to retention, and engagement metrics from a greater align-
ment of the workforce with the vision or objectives of the organisation.
160 P. Turner
The outcomes for the latter will include knowledge creation and dissemi-
nation leading to improvements in innovation and productivity, which in
turn will impact business measures such as shareholder value.
Benefits will be realised by having clear definitions of both talent and
engagement in the specific context of an organisation—providing a focus;
a strategy for ensuring that benefits are delivered both within the func-
tions of talent and engagement and between the two and business perfor-
mance. The ability to execute the proposed strategies will determine the
success of the initiative. This means that the strategies should have coher-
ence, congruence and consistency and clarity about expected outcomes
including measures of effectiveness for complementarity initiatives.
A summary of the strategies required to support the potential for com-
plementarity is included in Fig. 6.1 and a detailed description of each is
discussed below.
• Defining talent and talent management in the organisational con-

text; defining employee or workforce engagement
Identifying synergies between

talent management and
workforce engagement;
developing strategy to realise
the benefits of those synergies;
agreeing actions to deliver
Identifying synergies between
Defining talent and talent
talent management, workforce
management in the
engagement and organisational
organisational context
performance; aligning talent and
Defining employee or
engagement strategies to
workforce engagement
organisational strategies
Ensuring operational
alignment informing
Measuring return of Complementarity management activity for talent
and engagement with the
investment in talent and
complementarity principle;
complementarity; for 'business workforce leadership and management
case' and resource allocation
engagement competence aligned with
achievement of
complementarity objectives
Fig. 6.1 A model for developing talent management and workforce engage-
ment to achieve complementarity
Talent and engagement will be pivotal to organisational success. An

important prerequisite of delivering to the potential complementarities
therefore is a clear, organisation wide definition for each. A definition of
who would be regarded as talent and the organisation’s unique perspec-
tive of engagement will be important in answering the questions of where
to prioritise and how to direct activity accordingly (Schiemann, 2014).
The logic is that a clear definition will help to inform how an organisation
allocates its resources.
Talent management may have an exclusive focus relating to the ‘top
team’ or high potentials, or it may be inclusive and based on the mantra
that everyone has talent. Increasingly, the definition will be pluralistic
embracing both exclusive and inclusive elements. Whatever definition is
used, this step will provide the basis for a coherent approach to talent
management which would lead to the development of systems and pro-
cesses aligned to the achievement of the organisation’s unique objectives,
the identification of possible synergies with workforce engagement and
areas of potential for complementarity.
The principle of providing a focus is also important in seeking a defini-
tion of workforce or employee engagement. Once again this is likely to be
context specific because employee engagement is a multi-faceted, multi
layered construct to which simplistic definitions are difficult to attach
and simple ‘solutions’ unlikely to be effective (Turner, 2020). It is in part
a psychological phenomenon; in part a sociological phenomenon; and in
part an outcome of organisational dynamics. And it is influenced by sup-
ply push and demand-pull factors; where ‘supply push’ are those elements
that have a positive impact on an individual, the resources they have at
their disposal and the climate in which they work; and ‘demand pull’ ele-
ments that interfere with or motivation of the individual or the smooth
operation of work. The challenge facing organisations is to recognise the
effect of these in their own unique context and develop strategies to
ensure that there is enough supply to outweigh demand. Given these
considerations, it will be up to the individual organisation to decide on
how they define engagement, what elements of psychology, sociology or
organisation are relevant and which supply and demand characteristics
are strongest.
162 P. Turner
These definitions will provide a framework for three important consid-

erations. First, which aspects of the talent management definition and
portfolio of activities overlap with those of employee or workforce
engagement; second is there an opportunity to create synergies from
these areas and thirdly what aspects of organisational design, culture or
resource allocation need to change to support the achievement of
complementarity.
• Identifying synergies between talent management and workforce

engagement; developing strategy to realise the benefits of those
synergies; agreeing actions to deliver
The principle of strategy setting is that competitive progression occurs

where there is complementarity between business strategy, the organisa-
tion’s design, or structure, how it is stewarded or governed, and the poli-
cies enacted to deliver long term direction and day to day activity, applies
as the implementation of strategy is cascaded or devolved through the
organisation. In respect of talent and engagement this means understand-
ing how the relationships between the two can create more value than if
they were treated individually. An assumption in this area is that two
management practices can be defined as complementary if the adoption
of one practice increases the benefits of adopting the second practice. In
this case combining the strategies of separate domains can provide dis-
tinct advantages (Gupta et al., 2020; Fakhreddin et al., 2021; Wang et al.,
2021; Yang, 2021). However, for complementarities to be achieved it is
not enough to take a general approach to investments in talent manage-
ment or workforce engagement. Whilst many organisations choose to
develop human capital through training employees—‘existing research
suggests that such investments are likely to lead to superior financial per-
formance when the human capital is firm-specific’ and not in the sense of
generic training that can apply to any other organisation. ‘General train-
ing thus fails the test of valuable, rare, inimitable, non-substitutable, and
organizationally embedded’ (Riley et al., 2016). The same may be true for
employee engagement where general principles, whilst laudable, may not
deliver to the potential of complementarity. In both cases the organisa-
tion should seek to identify unique combinations of the two as a route to
progression.
This represents the initial point of entry. However, it will also be neces-
sary for actions to deliver the potential of identified synergies and in this
case ‘integration and empowerment’ will require systems and processes to
realise this potential. A business case for synergy will be the articulation
of potential, but organisational responsiveness, a clear plan of action and
competence in its enactment will be its realisation.
• Identifying synergies between talent management, workforce

engagement and organisational performance; aligning talent and
engagement strategies to organisational strategies
Those organisations that view employee human capital as an asset in

which to be invested and developed can expect to outperform those who
view it as a cost to be minimized. This is consistent with the resource-
based approach, in which an organisation’s valuable, rare, inimitable,
non-substitutable, and organisationally embedded resources result in
superior performance. It is argued that one of the most fundamental con-
siderations for human resource strategy is how to position employees ‘to
act in ways that advance the organisation toward its goals.’ Gallup’s, 2020
study concluded that learning and development opportunities were
strong influencers of engagement (Riley et al., 2016; Delaney & Royal,
2017; Gallup, 2020). Engagement is a primary means of aligning
employee efforts, and along with inclusive talent management may
become important factors for the effectiveness of business processes and
outcomes. The question remains as to how to identify the synergies
between talent and engagement and how their complementarities can be
used to achieve organisational progression.
To this end, Horgan and Mühlau’s (2006) excellent analysis was based
around the central claim of strategic HRM viz. the way an organisation
managed its workforce affects its corporate performance. They investi-
gated the hypothesis that high performance human resource manage-
ment, contributed to profitability. They argued that the benefits could be
attributed to ‘complementarities’ through the processes of reinforcement
and flanking. ‘When practices work consistently in the same direction (as
their main target or as a side-effect of a practice with a different primary
objective) and a practice alone lacks the power to achieve a critical
164 P. Turner
performance level, we refer to it as reinforcement. Practices can also flank

each other: Flanking consists in the strengthening of effect of the focal
practice by putting in place practices that create favourable conditions for
the working of the focal practice.’ The core hypothesis was that the com-
plementarity effect of the high-performance HR management system
enhanced employee performance over and above the sum of the effects of
any individual practices.
Following this approach means identifying those areas of talent man-
agement or workforce engagement that require reinforcement and allo-
cating resource to any aspect of these that does not have sufficient heft to
impact on performance. Not enough resource allocated to the learning
and development aspect of employee engagement for example, or not
enough resource allocated to the coaching aspect of talent management.
It is the assumption that positive interventions in these areas would have
complementary effects over and above those that would occur if this
identification had not taken place. In a similar vein, flanking would
require additional attention to any aspect of talent or engagement that
does not support the objectives behind interventions that had taken place
independently. For example, difficulties in accessing learning resources,
making it difficult to fulfil an engagement objective relating to personal
development. In these cases, identification is the precursor to action.
Operational alignment is the construct that converts identification
into action.
• Ensuring operational alignment informing management activity

for talent and engagement with the complementarity principle;
leadership and management competence aligned with achieve-
ment of complementarity objectives
Operational alignment will depend on leaders and managers who

understand the importance of a strategic approach towards complemen-
tarity in talent and engagement and who have the competences to deliver
them. It will be equally dependent on a workforce who are trained in
their current roles, have the resources to deliver what is expected and see
the ability to develop their own careers through talent management
opportunities. Leadership competences will therefore include
demonstration of the values of the organisation towards complementar-

ity—collaboration and cooperation; the ability to create an environment
in which such collaboration takes place and the ability to communicate
effectively the vision of where complementarity will take the organisation
i.e. outcomes over and above those which would have arisen if strategies
had taken place independently of one another. Managerial competences
will include being able to execute shared purpose and promote shared
values in respect of complementarity. It will be important for leaders and
managers to encourage cross functional collaboration which will have the
purpose of developing individuals and breaking down any barriers that
might exist.
Amongst the areas under consideration in operational alignment for
complementarity are demonstration of Values Based Leadership; Leaders
and Managers who recognise the importance of complementarity and
have the skills to identify where this exists and are empowered to allocate
resources or shape the organisation accordingly. In addition, the necessity
to develop complementary systems and processes that contribute to—
important elements of employee and workforce engagement that can be
facilitated by effective talent management. These are career and profes-
sional development-career paths and tracks and career development
opportunities.
• Measuring return of investment in complementarity; for ‘business

case’ and resource allocation
The measurement of HR activity and its impact on organisational per-

formance has been subject to considerable research and insight leading to
six phases or ‘eras’ of measurement over a twenty-year period which
included linking business strategy to human resource management and
using statistical analysis to demonstrate linkages between human resources
practices (including those which would be embraced by the contempo-
rary definitions of talent management) and organisational performance
(Kirkpatrick, 2010; Guest, 2011). Whilst such measurement processes
remain areas for study and debate the opportunity to show talent man-
agement and workforce engagement as genuine contributors to organisa-
tional objectives will continue. It is therefore an essential aspect of
166 P. Turner
complementarity that clear and measurable outputs are identified, and

systems and processes put in place to ensure that these are delivered.
People analytics and performance metrics will produce data, information
and intelligence about how the organisation is performing and the effec-
tiveness of its people management. An approach which builds in the
identification of complementarity opportunity into these metrics will
provide genuine insight about how the organisation can exploit its rare
resource to achieve competitive advantage.
Conclusion
A number of external factors including the Fourth Industrial Revolution
and the global pandemic have forced organisations to rethink how they
go about reaching their objectives—which in themselves have become
more than shareholder value or profitability and now include diversity
and environmental targets. The changing attitudes of members of the
workforce as they strive for fulfilling work experiences have also added to
the challenge of change. These factors present opportunities for organisa-
tions to transform the way they work.
People issues are business issues. Where a workforce is fully engaged
with the organisation’s objectives, where the knowledge, skills and atti-
tudes of its individual members are developed in support of this and
where strategy, structure and stewardship provide a favourable environ-
ment, then there are likely to be significant business benefits. Talent man-
agement and workforce engagement are two people management
techniques that can advance the achievement of organisational goals and
where combined, exploiting synergies. Addressing the potential for com-
plementarity between them therefore and converting the outputs of new
strategies and actions into organisational performance will have benefits
over and above those that would accrue if the functions were treated in
their traditional independent ways. Human resource practice combina-
tions are vital mechanisms in creating and utilising knowledge. Amongst
these are talent management, employee and workforce engagement.
There are opportunities for complementarity between them and between
them and organisational performance.
How benefits are realised will depend on effective human resource

strategy and practice. However, these will also depend on agile and
responsive organisation structures which will contribute to the mix for
complementarity.
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7
Complementarity in Organisation
omplementarity- the Interaction of Strategy

C
and Resource Allocation
Progression will depend on how an organisation’s design and culture con-
tribute to optimum performance from the multiple assets and resources
at its disposal. It’s structure will be such that it promotes and facilitates
cross domain co-operation in a transformed business model whilst taking
advantage of the new technologies of the Fourth Industrial Revolution-
applied from product creation, to sourcing of materials, to manufactur-
ing, to marketing.
The organisation’s design will have the objective of integration- secur-
ing linkages between strategy, components of the value chain and associ-
ated processes; whilst its culture be one of empowering the workforce
through digital technologies and the skills needed to use them. But inte-
gration and empowerment will only be achieved where the organisation
has favourable conditions for their implementation which will take
account of the nature of boundaries and working methods, the dissemi-
nation of existing knowledge and the ability to learn and absorb new
knowledge. Whilst technology will be the driver it will be organisational
responsiveness, competence, and culture that will turn potential into
https://doi.org/10.1007/978-3-031-10654-5_7
174 P. Turner
reality. And of particular importance to this book, a design that incorpo-

rates complementary forms of cross-domain alignment.
Amongst the examples of such alignment are those identifying com-
plementarities between IT and business strategy, between product inno-
vation and market responsiveness, management of external relationships
and business partnerships, effectiveness in planning and change manage-
ment, and information systems skills and infrastructure. Each of these, as
well as studies in, inter alia, the USA, Spain and France show significant
productivity gains associated with how organisations are able to integrate
new practices with new technologies and align them with business objec-
tives. In these cases, complementarity has the potential for a joint positive
effect on business unit performance but only where it takes place in a
favourable organisational environment.
The organisation’s design will both influence and be influenced by such
configurations. It will result from decisions involving technology, market-
ing strategies, human resource policies, supplier relationships, lines of
internal communication, and other operational policies. There are signifi-
cant benefits to those that are not only able to change and adapt, but to
do so in a way that recognises and exploits synergies that result from such
change. (Ballot et al., 2015; Chen et al., 2017; Fettig et al., 2018; Kircher
& Eeckhout, 2011; Lopez, 2012; Markard & Hoffmann, 2016; Milgrom
et al., 1991; Milgrom & Roberts, 1995; Moreno et al., 2019; Queiroz
et al., 2020; Richey et al., 2011; Song et al., 2005) In this context, com-
plementarity is a near synonym for synergy involving a fundamental
transformation which is multi-dimensional and includes technological
and institutional change. In the course of such a transition, new struc-
tures emerge as existing ones decline. Complementarity is not an innate
property of assets, but the result of choices- including organisation
design- and the interaction between these choices.
Three associated questions are important. First, what is the most
appropriate structure to meet the challenges of change; second how
should each element fit into this structure to ensure complementarities
are realised and third how can the organisation move from present to
future state in the most effective way. The requirement will be an envi-
ronment in which complementary assets- resources or capabilities that
generate benefits – are orchestrated in a way that accelerates business
7 Complementarity in Organisation 175
value over and above that which would be generated if they were stand
alone. It also means making any new business models work- based on the
organisation’s prowess in implementation, flexibility and agile gover-
nance. (McKinsey, 2022; Romero-Silva et al., 2018; Schwab, 2016;
Whittington et al., 2000) A positive outcome will be the creation of new
forms leading to mutually reinforcing systems that give better results over
those that would occur if such practices had taken place independently of
one another; where the relations of independent units create higher value
than their individual operation.
‘when the qualities of leadership complement those of management

which in turn complement those of talent management and employee
engagement in a holistic model of organisation, the outcomes will exceed
the sum of each of these phenomena as singular events.’
However, achieving it is not a simplistic link between activity ‘a’ and

activity ‘b’ but a series of challenges set in the context of environmental
and organisational complexity. The emphasis here therefore is on both
structure and dynamics facilitating complementarities-in-performance
and complementarities-in-use. (Baldwin, 2018; Fedele & Mantovani,
2008; Feizabadi & Alibakhshi, 2021; Jackson & Ni, 2013; Markard &
Hoffmann, 2016; Milgrom & Roberts, 1995; Soda & Furlotti, 2017;
Torres & Augusto, 2020; Yang, 2021; Yu et al., 2013) In this respect, an
understanding of the nature of organisation is important.
rganisational Evolution- from Hierarchy

O
to Matrix to Swarm
Organisations are associations of persons grouped around the pursuit of
specific goals. They are created to achieve objectives beyond those that
could be achieved by any one individual and are traditionally defined by
boundaries, a shared body of rules and processes and the empowerment
of managers to ensure that these are adhered to. But they are neither
homogenous nor static entities and are constantly adapting to new
environments.
176 P. Turner
An appropriate start to the discussion of the evolution of organisa-

tional theory is with Max Weber whose work on bureaucracy provided
the foundations for structure and hierarchy with clear lines of authority
and spans of control. In this model an organisation was designed to fulfil
objectives through formal responsibilities between people, departments,
or business units and how these relate to each other via linking mecha-
nisms and coordinating structures. The intent was uniformity of action
in pursuit of goals taking place in the context of the continuity of the
business enterprise. The strengths provided by hierarchical structure were
rationality of competence and specialisation, and precision in operation.
Steadiness and reliability were attractive propositions, providing a certain
predictability of outcomes. These were supported by sophisticated rules
and procedures designed to ensure consistencies in behaviour and prac-
tice- the classical school- reinforced by approaches to Scientific
Management that emerged in the USA during the Second Industrial
Revolution or the development of extended hierarchies with the advent
of globalisation during the Third.
The interdependence of the tasks informed belief in a structure that
was rational and coordinated. Technical subsystems such as processes or
workflow interfaced closely with social subsystems such as relationships
and communications. The hierarchy became the prevalent type and was
ubiquitous across both time and geography as industrialisation gathered
momentum and the opportunities of globalisation through interlinked
organisation became evident. Organisations were largely self- contained,
with functional or divisional structures, or based on a matrix formation
which was intended to prevent silos by spreading responsibility between
functions. In essence such designs were vertical, with the power of strat-
egy and resource allocation emanating from a central senior manage-
ment or executive cadre. They provided clarity of direction, objective
and levels of authority. To Elliot Jacques (1990) ‘managerial hierarchy is
the most efficient, the hardiest, and in fact the most natural structure
ever devised for large organizations. Properly structured, hierarchy can
release energy and creativity, rationalize productivity, and actually
improve morale.’
Nevertheless, bureaucratic structures were also associated with inher-
ent weaknesses such as the speed of reaction to changes in the
environment or the potential stifling of creativity. Furthermore, the

increasing complexity of globalisation forced a rethink as to how organ-
isations could capture the benefits across a broader range of economic
opportunities. Human relations theories led to a greater focus on social
and emotional factors and amongst the developments were functionalist
theories- ‘managerialist in orientation’- with an objective reality that
defined function, structure, lines of command and communication;
Radical or Critical theories which assigned more importance to power or
ideology; and Postmodern theory, which, in rejecting the concept of
objective reality, described organisations as reflecting different realities for
different people.
Successful alternatives to hierarchy, were shown in flatter structures
which were deemed to be important where the environment was chang-
ing rapidly ( the argument was put forward that organisations based on
small, autonomous teams were nimbler than large hierarchies, making it
easier to respond to change); where innovation was important and where
there was a strong central purpose which defined operations.
Contemporaneously, technology has facilitated the creation of virtual
organisations established on the basis of agile governance in scope and
structure. (Brooks, 2009; Burton & Obel, 2018; Crowther & Green,
2004; Handy, 2014; Hatch, 1997; Hickman, 2010; Jacobides et al.,
2018; Kang & Busser, 2018; Kastelle, 2013; Leyer et al., 2017; Sofer,
1972; Weber, 1930) Hence there was a desire for structures which empha-
sized business or workflow process reengineering, dispensing with inter-
nal boundaries. This was in part satisfied by digital technologies which
made it easier to work in a distributed fashion with flatter structures
becoming increasingly common - organising among small teams rather
than in hierarchies. And to the latest stage in design and development
bringing large scale outsourcing of what have been termed non-core pro-
cesses, modularity and most recently the virtual organisation typified by
collaboration to respond to exceptional market opportunities to enable
agility and more efficient leveraging of corporate assets or resource
deployment. (Hickman, 2010) There are now an increasing number of
variables affecting how organisations are designed and operated. Hence,
contemporary structures will span traditional hierarchies and well as
polyarchies, matrices and hybrids:
178 P. Turner
‘Given increasingly complex and dynamic environments, organisation

design must (a) include agility as a component of organizational fitness,
(b) broaden its focus to include complex and temporary multi-actor
enterprises, and (c) incorporate mechanisms and processes of shared
situation awareness; The key challenge facing organisation design in the
future will be how to design business ecosystems composed of self-
governing corporations, individuals, and communities.’ (Snow, 2018)
And so, organisations evolve as they adapt to changes in the environ-

ment, rationally determined by such factors as technology, the market,
size, or its culture (because culture is the glue that holds the organisation
together and stimulates employees to commit and to perform,) and
adapting to change as a sequence of environmental challenge and response
determines their scale, scope and shape. However, the process by which
structures emerge is not always rational, logical and sequential. Responses
can be ad hoc or the result of internal dynamics or politics that may or
may not be related to market or environmental change. In whatever way
it is reached, the structure- whether it be through work specialisation,
departmentalisation, chain of command, span of control, centralisation
and decentralisation or formalisation, will have an impact on the way
that organisation develops and delivers strategy and its capability to
secure the benefits of complementarity. The question to be answered is
‘when is it advantageous to spread complementary assets, skills and activ-
ities over many separate organisations vs. uniting them within the bound-
aries of a single firm?’ (Baldwin, 2018; Van den berg & Wilderom, 2004)
How to do so will require a model for the creation and dissemination
of knowledge, ensuring that knowledge is applied in an optimal way. It
will require leaders and managers who are committed to organisation
wide goals and objectives as much as functional or business unit ones;
talent that is regarded as a corporate resource and is deployed for the
benefit of the wider organisation; and workforce engagement that adds to
the strength as a whole. In some cases, these requirements will be in the
context of intertwined structures with alliance partners as part of an
envisaged ecosystem. (Sofer, 1972; Handy, 1976; Sarkar et al., 2001;
Friesen et al., 2014; Blanc-Serrier et al., 2018; Giri & Ramakrishnan,
2018;Torres & Augusto, 2020) There are important elements that will
influence the design of such a model.
A Complementarity Model of Organisation

Given the strength of the arguments in favour, what conditions will lead
to the breakout from established paradigms to create a new model? This
is important because business process coordination is dependent on the
buy in of every department or domain, business partners, suppliers, and
customers along the value chain. There are significant interdependencies
between organisational domains. The argument being that competitive
progression is possible by recognising these interdependencies and estab-
lishing ways to exploit complementarities between rare or valuable
resources with a structure and competence to do so. Improved perfor-
mance will result, not only from developing resources, but also from
deploying them in an optimal way. A constellation of units, aligned and
coordinated, are able to transfer knowledge between themselves in the
creation of something greater than the sum of their individual parts. They
will do this by combining tacit and explicit knowledge management in a
complementary way, invoking synergies and ultimately improved organ-
isational performance. Indeed, organisations that are open to changes can
be more efficient in adopting new technologies which translates into pro-
ductivity gains. (Choi et al., 2008; Hottenrott et al., 2016; Hsu, 2013;
Nooteboom, 1999)
The process will involve agility, reflecting ‘organisational fitness,’ and
collaboration across enterprises with systems and processes which raise
awareness of opportunities through intelligence and insight. ‘Synergies
can arise from the opportunity to create denser organisational ties, hence
greater coordination between the business units. These synergies derive
from the strong complementarity of interdependent tasks.’ However, this
is not an automatic outcome and has to be fostered. (Baldwin, 2018;
Doherty & Terry, 2013; Newell et al., 2003; Torres & Augusto, 2020) A
desirable objective therefore is to seek a design that facilitates integration
and encourages collaboration across classical functional or institutional
domains, which creates an impetus to understand the mechanisms of
interdependence between specific elements and how these can shape cer-
tain outcomes. Such elements can be internal, or in an age of business
ecosystems, external- from technology partners for example. Indeed, it
may be the breadth of the ecosystem of related product and services that
180 P. Turner
will become a prerequisite for success. Greater understanding will pro-

vide a framework within which organisational design and development
can be accommodated. (Jackson & Ni, 2013; Janoszka, 2018; Parmigiani
& Mitchell, 2009)
Resources, activities and processes are highly interdependent and
inherent in the model (outlined in Fig. 7.1.) Hence there are strong links-
with many variations- between such areas as technology platforms or cus-
tomer relationship management and complementary resources, which
might include process, structure, capability, or culture. (Shang et al.,
2007) There is unlikely to be a best practice in achieving desirable out-
comes but there are some waypoints which may act as guides. Three par-
ticular areas are important, these being identifying elements, modelling
them for maximum benefit, and aligning the organisation to deliver iden-
tified potential. The following are some of the assumptions attached to
each of these areas.
• Complementary Elements, Sets and Bundles of Resources
Align and Implement -Strategy Complementary Elements, Sets

and Plan and Bundles of Resources
- develop strategy for integrating - identify elements, sets and
resources to realize synergies bundles that provide opportunities
- Align organisational structure to for complementarity
new requirements - tangible include strategy, policy,
- Utilise 'n' step or dynamic change and the formal rules of
organisation; technology
management processes
applications
- Measure outcomes of
intangibles human resources,
complementairty initiatives
knowledge, culture
An Organisation Structure for Orchestrate Resource Allocation

Complementarity for Complementarity
- Take a systemic and holistic view - seek insights from modelling
of organisations, 'clusters of interconnected
- Seek patterns or profiles related structures and practices'
to performance.outcomes - to transform data into intelligence
that the organisation can use
- Set complementary assets in a effectively in its decision-making
design that is fit to deliver
synergies Complementarity in processes’
- Allocate resources to areas of
Organisation Design
maximum complementarity
and Development
Fig. 7.1 Organising for Complementarity

Whilst the overwhelming thrust of the Fourth Industrial Revolution is

technology based, such resources can lead to increased business value and
organisational performance only when they are complemented with
other organisational resources. Many organisations may have the same
physical technology, but only some of these may have the social relations,
culture or traditions fully to exploit it. (Moreno et al., 2019) What are
the assets or resources that can be used in a complementary way? And
what structure is the most appropriate to create an environment to facili-
tate collaborative processes. The combination of ‘organisational elements’
is an important contributor in answering these questions and can play a
role which is analogous to that of chemical elements in composing a vari-
ety of substances. These basic elements are subject to ‘combinatory laws’
that regulate their effective combinations or synergies and when these are
effective, they can produce high levels of efficiency and innovation.
Complementarity can be unilateral where a single element provides a
benefit to the other but not vice versa, or bilateral, where both elements
achieve benefits for each other. However, it is a matter of perspective and
whether a specific component is complementary to another depends on
the underlying purpose. (Markard & Hoffmann, 2016) Because organ-
isations are composed of ‘interactants’ with specific competences and
resources there will be specific features that only they will have. Such
features can be a source of ‘socially complex’ resource and turned to
advantage through complementarity strategies and processes. (Hsu,
2013; Zeller and Barmeyer & Franklin, 2016; Nayaranan 2021)
For example, an analysis of performance accounting data of U.S. man-
ufacturing firms, showed that the complementary effect between enter-
prise resources planning and e-business technologies in creating business
value was stronger than the main effects of each of these technology appli-
cations taken independently. Whilst an extensive study of Brazilian busi-
nesses found complementarity resources (to IT) in training: process
orientation, organisational structure, a strategic focus on business integra-
tion and culture. General Electric who produced a wide array of products
based on electric motors, was able to use its research into designing and
producing electric motors as complementarity to its strategy of producing
a broad range of products using those motors. ‘Improvements in the costs
or capabilities of electric motors for one product line increased the
182 P. Turner
probability of improvements for other products lines.’ Here, complemen-

tary resources are those that generate added value exceeding the sum of
that obtainable from stand-alone resources applications. They can deliver
by symbiotic complementarity, where surplus value is generated by differ-
ent elements or by pooled complementarity, where surplus value is gener-
ated by similar elements. (Baldwin, 2018; Brynjolfsson & Milgrom,
2013; Grandori & Furnari, 2008; Hsu, 2013; Magalhaes, 2018; Markard
& Hoffmann, 2016; Moreno et al., 2019; Soda & Furlotti, 2017) An
example that embraces all of these principles successfully is that of the
Walt Disney Company. Its business segments are structured to make the
most of complementarities, thereby creating better value for its customers
as well as adding greater value to the company as a whole.
‘To understand these complementarities better, consider how Disney’s

business segments are organised along a supply or value chain. Disney
creates entertainment content such as movies, TV shows, and trade-
marked characters with a variety of production companies, such as
Walt Disney Pictures, Twentieth Century Fox, Marvel, Lucasfilm, and
Pixar. This content is then distributed via traditional channels using
Disney’s media networks, including Disney, ESPN, Freeform, FX,
National Geographic, and ABC. Disney also offers this content through
novel distribution channels, such as the streaming services Hulu and
DisneyPlus.’ (Yang, 2021)
Amongst assets which have been identified as complementary in previ-

ous research are and outlined in Chap. 3 can be market-related phenom-
ena through production complementarity and consumer complementarity;
or resource complementarity with potential for synergy- those ‘valuable,
unique, and inimitable’ synergies that can be realized by integrating com-
plementary resources. These resources or assets include:
• Organisation structure, design or form- design facilitates the ability

to combine resources from different domains e.g. finance and technol-
ogy or marketing and operations. Agility and flexibility are valuable
intangible assets that can complement other initiatives; including
competence in change and transformation and effectiveness in plan-
ning and change management. Other attributes are cost income struc-
ture; a structure designed to facilitate innovation and the delivery of

the outputs of innovation; and finally, production complementarity
between management control mechanisms.
• Information and communication technology- the ability to inte-
grate technologies into multiple business areas; using innovative tech-
nology applications; combining enterprise resource planning and
e-business technologies; linking R&D with product development.
Since technologies per se will not produce complementarities, the
presence of information systems skills and infrastructure are essential.
• Marketing- includes product innovation, market responsiveness,
management of external relationships, business partnerships, customer
relationship management, distribution channels; service complemen-
tarity, where new services complement existing services; brand reputa-
tion over multiple product lines
• Operational Management- economies of scale and scope in ‘the value
chain of development’ and production; efficiencies by joint coordina-
tion of multiple activities; ability to reduce transaction costs by com-
plementary operational activity; leaders and managers with competence
in identifying complementarities in operations; an empowered work-
force able to make improvements in production giving improvements
in productivity; change management and process transformation;
'dynamic capabilities', leading to timely responsiveness and rapid
innovation.
• Social Complexity and Human Resource policies- an empowered
workforce; social relations, culture derived from clarity of mission or
vision; effective integration between talent and workforce engagement;
human resources policies aligned to achievement of complementarities;
the means to achieve objectives the image of the organisation, effective
management processes, the integration of employee needs and objec-
tives with those of the organisation, interpersonal relationships, and
transformative leadership; unique leadership and management
skills or style
• Knowledge management- the ability to co create and co capture
knowledge; technical knowledge, partly codified and partly tacit;
organisation wide systems for knowledge creation and dissemination;
the ability to convert knowledge into innovative products and services;
184 P. Turner
the ability to convert knowledge into improvements in systems and

processes, economies of scope through greater knowledge across prod-
ucts and services; business intelligence and analytics
• Relationship management- unique and valuable relationships with
suppliers, customers, and collaborators in a business ‘ecosystem;’
exploiting inter-organisation expertise to produce superior solutions,
ability to exploit skill specialisation as it crosses over from knowledge-
able partner organisations; ability to ‘monitor and learn from suppliers.’
There are two scenarios in which combinations of the above into com-
plementarity outputs would take place. In the first, there is the possibility
of serendipitous complementarity where benefits are accrued even in the
absence of planned and systematic approaches or strategies. This is com-
plementarity in its original interpretation, whereby positive outcomes
came out of unlikely or unforeseen combinations or interactions. In this
instance, sustained advantage will be achieved where the organisation is
agile enough to change structure to accommodate or reinforce its causes.
The strengths of leadership, management, talent and engagement remain
important. Their ability to shape the organisation to maximise the poten-
tial will be the deciding factor of whether complementarity is reinforced
or whether it is lost to stasis. Indeed, the development and continued
existence of organisations depend on how they manage sustainable prob-
lem- solving practices. ( Barmeyer & Franklin, 2016) However, if the
outcomes are to go beyond serendipity, then such recognition will come
about by enlightened management being proactive in their search for
complementarities and a culture that is supportive of and actively seeks
innovation. In this case, success would come from identifying sets or
bundles of practices which work synergistically and crafting a strategy to
ensure that they do so. In some cases, this will apply to two practices- for
example between two innovation practices which means that investing in
one increases the value of another. In some cases, they will be internal
processes and in others working with external partners.
The potential can be identified internally through combinations of
resources or externally in alliances with partners. In respect of the former,
the first challenge is to identify where unique or valuable resources or
practices are present. These may be technologies that are able to span
several areas of the organisation and provide benefits over and above the
ones that were present in a single application. Or they may be concerned
with the unique skills, talents or culture that is present and has the poten-
tial to be cross domain with benefits in one area enhancing those in
another. Erik Brynjolfsson and Paul Milgrom (2013) give an expert sum-
mary of such a situation.
‘Consider a company that is evaluating a triple of decisions: 1) Whether

to adopt a strategy that requires implementing frequent changes in its
technology, 2) Whether to invest in a flexibly trained workforce, and 3)
Whether to give workers more discretion in the organisation of their
work. Suppose that more flexibly trained workers can make better use of
discretion and that more flexibly trained, and more autonomous work-
ers make it easier to implement new technologies effectively, because
workers are more likely to know what to do and how to solve problems.
Then, there is a complementarity between several pairs of decisions,
which is characteristic of a system of complements.’
There are strong arguments in favour of complementarity between

internal innovation and external partnerships or cooperation. (Chen
et al., 2020; Furlan et al., 2011; Jackson & Ni, 2013; Janoszka, 2018;
Mothe et al., 2015; Sabidussi et al., 2017; Serrano-Bedia et al., 2012;
Wang & Savin, 2021; Yang, 2021)
If organisations are to gain insights into achieving increased competi-
tiveness, they will require information about the relationships between
individual elements or factors, and innovation practices, which makes
this aspect of analysis important. For those adopting and implementing
elements which will provide complementarity such as enterprise resource
planning and knowledge management it is critical to consider the differ-
ent potential orientations and foci associated with each initiative. And to
evaluate and prioritize the relationships between expected outcomes that
will inform the design and long-term development of the organization.
(Janoszka, 2018; Newell et al., 2003) Identifying those strategies,
resources or practices that, when combined, give additional advantages is
therefore an important first step in the process.
186 P. Turner
• Orchestrating Resources for Complementarity
The second aspect of the organisational model for complementarity is

how to allocate or orchestrate resource to deliver benefits. Business
Intelligence and Analytics involving all the resources required ‘to trans-
form data into intelligence that the organisation can use effectively in its
decision-making processes’ will be critical. First, understanding the com-
binations of specific resources or assets that may provide added value;
second constructing a business model whose system of activities stretches
outside of the limits of a single unit or domain and covers all of its
resources and activities linked by transaction mechanisms. This will
include customers, suppliers, and partners who ‘interact in pursuit of the
same objective or need—namely, the creation and appropriation of
value.’ Hence the organisation can be viewed as a system of intercon-
nected choices and performance is derived from tight complementarities
between activity choices that reinforce mutually in a positive way, and the
appropriateness of an organisation’s system of activities with the environ-
mental conditions that prevail. The allocation of resources to where and
the resulting organisation structure will seek to capture value from all
stakeholders. (Camuffo & Wilhelm, 2016; Climent & Cakir, 2021;
Janoszka, 2018; Milgrom et al., 1991; Moreno et al., 2019; Zeller &
Narayanan, 2021)
If an organisation consists of clusters of interconnected structures and
practices, then determining how these can be shaped to elicit comple-
mentarities is essential. In this case, there will be an element of heuristics
in which the new structure can be tested for its efficacy or ‘a vehicle for
experimentation in the belief that the insights gained can be transferred
to the operations being modelled.’ On the one hand complementarities
can be identified when modelling two factors; (Hong et al., 2015; Zhang,
2001) on the other, combinations of multiple variables may provide rich
sources of additional benefit. Academic research has been used in a vari-
ety of sophisticated analytical techniques in modelling such clusters.
Managers will base their decision making on information produced by
such analyses or rely on heuristics to deal with unexpected situations. An
organisation design should bear in mind both possibilities but in all cases
provide feedback that gives the opportunity for managers to learn about
complementarities and the type of evidence they will need to make stra-
tegic and operational decisions. (Lyons, 2004; Pidd, 2004; Sánchez-
García et al., 2020; Yang, 2021; Zeller & Narayanan, 2021)
This configurational approach represents a systemic and holistic view
of organisations, where patterns or profiles are related to an outcome
such as performance. The more that complementarity is focused on the
design of a business model and its organisational implications, the greater
the performance. For example, if there are three-way complementarities
between information technology, performance pay, and HR analytics
practices, which, when working together produce a larger productivity
premium than if they worked separately, what would be the best struc-
ture to ensure that added value is delivered. Would it be one of hierarchy
with cross domain groups coming together to identify and deliver bene-
fits; would it be a matrix structure in which a function runs horizontally
through an organisation instead of vertically down and organisation; or
would a swarm of those with different expertise come together for a spe-
cific purpose and disband at the end of the project. Each of these exam-
ples is concerned with complementarities from synergies among resources
and capabilities. However, because of the many potential combinations,
there is no single best practice model for organisation. It can be based on
supply side economics, or a more holistic approach- an ‘integrative busi-
ness model,’ combining customer complementarities with other business
models. This will be achieved by facilitating internal collaboration, net-
work flexibility and operational capability together. (Anantatmula &
Kanungo, 2006; Aral et al., 2012; Aversa et al., 2020; Climent & Cakir,
2021; Fiss, 2007; Galpin et al., 2007; Liao & Li, 2019). Hence a com-
prehensive approach would consider the two types of complementarity:
traditional supply-side mechanisms of resource and capability comple-
mentarity and demand-side mechanisms of customer complementarity.
(Aversa et al., 2020) It is clear that modelling configurations of comple-
mentarity inspiring assets or resources will range from the theoretical two
factor model of complementarity to a significantly more complex multi-
variate model through to one that embraces supply and demand side
possibilities.
The result of modelling or testing of combinations will help to deter-
mine the necessary structure to deliver potential benefits. A number of
188 P. Turner
configurations might exist across the different domains of board and

management structure, workflow processes and the workforce. (Arora
and Gambardella, 1990; Fiss, 2007; Furlan et al., 2011; Jackson & Ni,
2013; Mothe et al., 2015; Yang, 2021) Having identified factors, tested
combinations of them and the likely outcomes, it is the role of the organ-
isation’s stakeholders- leaders, managers, and the workforce- to allocate
resources to the appropriate areas and to put in place a structure that is
able to deliver to such potential.
• An Organisational Structure for Complementarity
The identification and analysis of complementary resources is a neces-

sary but insufficient condition to achieve synergy. Another area of equal
importance is matching resources to capabilities to structure to opportu-
nity. The design will facilitate setting a strategy for complementarity but
also provide an environment in which the coordination of capabilities,
transactions and scale of processes is recognised and implemented. It will
determine the most appropriate allocation of resources. These are inputs
into the production process, such as capital, equipment, information sys-
tems, and individual employees; and capabilities, or the capacity to
deploy resources using organisational processes. At the same time the
organisation’s design will limit counteracting forces such as errors of strat-
egy ‘cognitive inertia and myopia, unclear allocation of rights and respon-
sibilities, errors in identifying aims, imprecision in performance
measuring, difficulty in focusing incentives, influence activities and prob-
lems of internal communication.’ (Morroni, 2007) Crafting a strategy
that delivers complementarities and creating a structure that leads to the
optimisation of potential benefits is high on the corporate agenda.
As outlined earlier, an organisation’s structure- often reflected in an
organisation chart- is a way or method by which activities can be divided
and coordinated. In post-industrial organisations the emphasis is on
knowledge and how it can influence creativity, innovation, discovery and
inventiveness. And so, the structure will contribute the optimum way of
focussing these on value and increasingly to complementarity and the
relations between both hard elements on one side and soft elements on
the other. The structure provides the framework for jobs, systems,
operating processes, people and groups. It is the model for internal rela-
tions and reporting, communication channels, as well as the clarification
of responsibility and decision- making delegation. (Ahmadya et al., 2016;
Martins & Terblanche, 2003) So, what is the structure that is best fit for
the organisation, taking account of what the organisation is capable of
implementing based on its existing design, its history, and its culture. The
options are many and varied:
• A hierarchy provides rationality in decision making, clear policies,

uniformity in systems and processes and accountability for strategy
and operations through delegated management, vertically organised.
Its critics will point to a lack of flexibility and responsiveness to rapidly
changing environments. Those responsible for organisation design will
therefore be required to balance the pros and cons of this type struc-
ture in respect of their own specific culture and circumstances. In par-
ticular they will decide on whether the necessary collaboration to
achieve complementarity is possible or would be constrained by the
strictures of hierarchy.
• An alternative is a matrix structure that emerged during the period of
globalisation and provides a different methodology for ensuring that
cross organisational value is captured by a horizontal orientation of
key resources. This is characterised as being both vertical and horizon-
tal and ‘aims to capture both the efficiency and specialisation of a func-
tional organisation, as well as the customer focus and flexibility of a
multidivisional organisation.’ (Saunila et al., 2013) For example, in
addition to a single market or product focus for a business unit would
be a ‘global’ perspective provided by the matrix which would identify
opportunities across products or markets and management authority
to allocate resources to take advantage of those opportunities. Once
again there will be critics who will point to a lack of clear accountabil-
ity, or multiple accountabilities, for a specific which may lead to con-
fusion about the whole. Once again, the unique context of the
organisation will provide additional information on whether to adopt
this type of structure.
• Decentralised organisational forms have arisen because of two realisa-
tions. First that increased operational decentralisation was deemed
190 P. Turner
necessary to improve response times and to harness the tacit knowl-

edge of operating managers; second that strategic decentralisation
increases the results-orientation and accountability of business manag-
ers. ‘Decentralisation into smaller units promotes cross-functional and
cross-boundary teams. In place of rigid traditional structures, organ-
isations are increasingly shifting towards more flexible, project-based
forms of organisation. Structures are therefore taking on a more hori-
zontal character, projects being the vehicle for bridging the divisions of
traditional divisional organisation.’ (Pettigrew et al., 2000)
• New forms of organisation- open boundary or organic structures- that
are emerging out of the miasma of technological change. These are
characterised by dynamic, responsive capabilities a lack of formality
and flexibility and include those based on self- managed teams and
self- organising systems; there are networks with multiple nodes;
swarms, virtual organisations and alliances. Encapsulating many of
these characteristics is the view of the organisation as an ecosystem, of
interacting organisations and modular in style.
The design of the organisation will be critical in the quest for comple-
mentarity benefits. But there is no one right way and no simple indicators
to inform such decisions. Instead, those leading and managing the organ-
isation will make their decision by balancing the actualite i.e. the reality
of the current structure, its systems, processes and culture, against the
potential of transforming the structure. What change processes need to
be put in place to ensure the engagement of all stakeholders. Alignment
and implementation therefore become important considerations.
• Align and Implement - Strategy and Plan
Identifying potential areas for synergy and their constituent elements

will lead to a strategy for integrating resources. A concomitant action will
be to align the organisational structure to the requirements of the strat-
egy. Clarification of the proposed new structure, its objectives, purpose,
and its benefits with the alignment of objectives to identified outcomes
will be achieved by the dissemination of information, leaders and manag-
ers who are prepared to communicate and accept suggestions or
proposals and a workforce that is fully engaged with the changes that are
envisaged- regular communication of strategies to the whole workforce is
also important since it is an important process in anticipating any poten-
tial resistance to change. Amongst the most prominent of the rational
approaches to change and its associated alignment is that articulated by
Kurt Lewin (1947) whereby the ‘the practical task of social management’
required insight into the desire for and resistance to change and therefore
an understanding of the social forces for change. The view was that
change was best delivered by three steps- unfreezing, moving, and freez-
ing of group standards. Lewin postulated that individual behaviour was a
function of the group environment and therefore to bring about change
depended on group acceptance of change. Subsequent methodologies
advocated a planned and systematic approach often involving a number
of critical, sequential and interlinked steps. Other processes included
those involving diagnosis, preparation, implementing change, consoli-
dating change and sustaining change or integrated multi phased models
involving awareness, the desire to change, knowledge of how to change,
implementing change, and sustaining change or the ‘n-step approach.’
(Turner, 2021) Having obtained the necessary agreement to the propos-
als, a coordination of actions and anticipation of potential implementa-
tion problems and regular reviews of outcomes compared with initial
assumptions will be necessary.
The structure will also provide an effective way for key stakeholders to
engage with the process because ‘changing only a few of the system ele-
ments at a time to their optimal values may not come at all close to
achieving all the benefits that are available through a fully coordinated
move.’ Achieving complementarities often requires change to be whole-
sale rather than piecemeal; more akin to transformation and achieving
competitive advantage depends upon a firm’s ability to deliver this change
efficiently and effectively, exploiting existing knowledge and to generate
new knowledge. (Hsu, 2013; Janoszka, 2018; Laursen & Mahnke, 2001;
Milgrom & Roberts, 1995) Leaders and managers will be required to
deliver such a transformation in situations that are often challenging,
always complex. Changes can be functional, divisional, matrix or net-
worked. They may be hierarchical with tight sets of rules and procedures
or networked operating with a broad ecosystem of departments with
192 P. Turner
flexible boundaries and incentives to collaborate. The new organisation

structure should seek to maximise the output identified and modelled in
the analyses discussed above including the exploitation of tangible
resources such as technology and intangible ones such as knowledge. It
should free those charged with running the organisation from constraints
to do so. A structure informed by strategy and managed with agility,
respecting stewardship and policy, may be the difference between success
or failure.
Amongst the most critical factors are human resource practice combi-
nations which provide the coordination mechanisms to organise knowl-
edge creation and exploitation, or technology applications in the complex
social relations which typifies most organisations. Human resource prac-
tices will facilitate the implementation of complementarity systems and
processes. For example, internal training is a strong complement to other
work practices or various forms of teamwork are made more effective if
responsibilities are delegated to team members because it allows them to
bring to bear their existing knowledge and to develop new knowledge for
tasks that managers up in the hierarchy are unable to understand.’
Where activities are organised in a ‘flexible, decentralised, informal
and highly integrated organisational structure’ there is the possibility of
complementarity and a strong internal capacity to develop new services
or products. (Harrison et al., 2001; Laursen & Mahnke, 2001) This
accentuates the need for adopting a wide variety of changes if the full
benefits are to be realized. It will be the responsibility of leaders and man-
agers to ensure such systems and processes are effective. This means seek-
ing cooperation to ensure that the design is implemented with the full
‘buy in’ of those involved, because cooperating individuals will provide
each other with necessary and relevant information, willingly support
and help each other whilst understanding each other’s points of view, be
influenced by each other’s knowledge, interests and ideas, and rely on
division of labour. (Feizabadi et al., 2021; Jackson & Ni, 2013; Sarkar
et al., 2001; Turner, 2021; Yang, 2021) Several factors have been identi-
fied as contributing to effective alignment and implementation.
The dynamic environment which constitutes the Fourth Industrial
Revolution favours organisations which are able to provide timely revela-
tions of useful information which is essential for effective decision
making. An optimum position would be where there is an openness to

sharing which overcomes the ‘well- known problem’ of subdivisions
resisting the early revelation of persistent private information because of
the fear that the revealed information will be used inappropriately- or
against the objectives of a particular domain. This is particularly impor-
tant in organisational design and its implementation because sharing and
delegation is critical to complementarity in operations for future exploi-
tation. Hence an optimal organizational design would be one that deliv-
ers the benefits of delegation by prompting and facilitating timely
information revelation. (Shin & Strausz, 2014)
Conclusion
This chapter has sought to answer three questions, concerning the best fit
structure to meet the challenges of change; where each element of the
organisation could fit into this structure and the best way to move from
present to future state. There were choices in response to each of these.
The most ubiquitous form over Four Industrial Revolutions has been
that of the hierarchical structure which, with its associated bureaucratic
processes, rules and regulations guiding policy and behaviour, has crossed
industry and geography. But structures were rarely static and as the world
economy grew, particularly during the era of globalisation, so did organ-
isations with new forms as the limitations of rigid hierarchies began to
show. Divisional structures – often M shaped- grew in response to the
diverse needs of international markets. Functional structures were also
adopted to strengthen a particular area such as marketing or technology
and where this was considered to be the fomenter of silos, then horizon-
tal, flat or matrix structures came into being. And in today’s environment
a range of innovative designs have emerged in response to the pace and
dynamism of the new environment. Networks have evolved as a way of
organising to take advantage of exciting ecosystems of collaborative
organisations and ‘swarms’ are put in place to deal with a specific oppor-
tunity by concentrating resource. Over time, organisations have proven
to be responsive; sometimes innovative, and rarely static. The opportu-
nity presented by complementarity gives additional impetus to consider
194 P. Turner
design not merely as a way of ensuring consistency in behaviour and

checks and balances in policy, but as a powerful element of competitive
advantage. Complementarity can become a key area in designing a busi-
ness model and organisation.
For organisations to compete in the rich and dynamic environment
that is the Fourth Industrial Revolution, they will need to embrace struc-
tural flexibility and agile governance, the maximisation of cross domain
technologies, the creation of high performance teams with coordination
and cooperation, the application of human resource practices that facili-
tate continuous learning, empowerment, and the decentralisation of
decision making and ‘systems for mobilising employee proposals for
improvement’ with an emphasis on internal knowledge dissemination.
But the challenge will be to decide which design best serves the context
of the organisation and for this there is no best practice template. Since
the interactions between different elements of design are important,
identifying which of these interactions can make the greatest contribu-
tion to complementarity will provide the basis of change or transforma-
tion. (Athey & Stern, 1998; Feizabadi & Alibakhshi, 2021; Laursen &
Foss, 2003; Mothe et al., 2015) Complementarity is therefore an impor-
tant aspect of organisational analysis, of organisational dynamics and
ultimately of organisational design. It can be used to inform the combi-
nations of practices that offer advantages over and above those that would
occur if linkages and synergies were not identified, exploited, and built
into the essence of the organisation through its structure.
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8
Complementarity
and Competence-knowledge, Skills,
Attitudes, and Behaviours
Complementarity- a Combination
of Organisational Competence
and Leadership Capability
Achieving business progression will depend on how an organisation
applies its core competence- collective knowledge used to create competi-
tive advantage- and its leadership and management competence—creat-
ing a clear vision or direction and an ‘enabling environment’ for its
realisation. Competences are tacit, complex, and organisation specific,
involve ‘interrelationships among the skills of many individuals’ and are
firmly embedded within the fabric of the organisation. (Wittmann et al.,
2009) Of particular interest in this chapter is the contribution of both
core and individual competence to complementarity.
Amongst the key areas for consideration will be how competence is
demonstrated through the efficacy of resource allocation- critical to the
achievement of complementarities and synergies- towards tangible assets
such as cash, inventory, equipment and information and communication
technology; or intangible ones such as knowledge and creativity or a cul-
ture of collaboration, or excellence in product innovation and distribu-
tion channel management; or operational efficiencies based on the
https://doi.org/10.1007/978-3-031-10654-5_8
204 P. Turner
effective coordination of multiple activities. To maximise the outputs of

investments in these areas will require competence at multiple levels, a
structure that facilitates knowledge exchange and collaboration, and a
philosophy of aspiring to success for the whole organisation. Ultimately,
the impact of these decisions will be reflected in business performance;
and manifested by progression through profit, return on investment, or
maximisation of shareholder value, and social objectives such as fair-
trade practices, contribution to social welfare, actions on care for the
environment, or diversity and equality of opportunity.
The extent of organisational complementarity will be influenced by
competence in four interrelated sources of distinctiveness. First, there are
input-based competences which are physical, financial and human
resources that create and deliver goods and services. Second, managerial
competences are the unique capabilities of leaders and managers to craft
strategy, communicate and engage the workforce in that strategy and to
create supportive systems and processes. Third, transformational compe-
tences include innovation, the organisation’s culture, and organisational
learning. Finally, output-based competences refer to tangible outputs-
products and services and intangible outputs including customer loyalty
and organisational reputation. (Kassahun & Molla, 2013; Lado et al.,
1992). Using these categorisations, organisational competence includes
the effective integration of technologies, specialised knowledge, skills,
techniques, and experiences in a way that delivers differentiated advan-
tage. Organisations build this by strategic product or service decision
making and by applying business improvement methods such as total
quality management, business process reengineering, or six sigma pro-
grammes, with a view to delivering a business proposition- innovative
models, that will create value for their stakeholders. In this case compe-
tence reflects expertise that determines how an organisation is able to
orchestrate its resources and adapt its routines- usually in combination.
Successful organisations will additionally try to use big data and knowl-
edge management technology to inform resource allocation, as well as
agile governance in responding to external dynamics. In so doing, knowl-
edge will become one of the most important resources and harnessing
it is both a feature of core competence and a means of developing it.
8 Complementarity and Competence-knowledge, Skills… 205
(Le Deist & Winterton, 2005; Menor & Roth, 2007; Prahalad & Hamel,
1990; Richey et al., 2011; Turner, 2021; Yang, 2015; Yin et al., 2020)
Secondly, complementarity will be influenced at the individual level
where competences will be specific, related to a particular business
domain, or generic relating to interpersonal capabilities. They can refer to
competences that are cognitive or work-related knowledge and the ability
to apply it; functional- the ability to perform work-based tasks; social or
relational and communication skills; and meta-competence or personal
and professional values. In the case of leaders and managers these become
the know- how, know why, know what, know when and know how to
behave. Contemporaneously, these will contribute to organisational suc-
cess not only by singularity- discreet interventions based on specific
responsibilities or objectives in relation to an organisation, a business
unit or a department- but also complementarity- interventions that are
connected to a broader purpose. Here, competences can be causally
related to the organisation’s performance and consist of knowledge- the
retention and utilisation of information, skills- the ability to demonstrate
a sequence of behaviour towards a goal- and attitudes and behaviours-
the social manifestations of how a manager undertakes a role. Individual
competence can therefore be defined as a ‘specific, identifiable, definable,
and measurable knowledge, skill, ability, and/or other deployment related
characteristic (e.g., attitude, behaviour, physical ability), which an indi-
vidual may possess, and which is material to the performance of an activ-
ity within a specific business context.’ In contemporary organisations it is
the result of a combination of cognition, intuition and emotional intel-
ligence. (Boyatzis, 1982; Sparrow, 2000; Stepanenko & Kashevnik, 2017).
Complementarity, facilitated by the application of core and leadership
and management competence, has the potential to provide organisations
with both efficiency and enhancement synergies (Bauer & Matzler, 2013)
by identifying and then combining, unique or rare resources in ways that
are difficult to imitate on the part of competitors. For example, Teece
(1986) highlighted innovation- technical knowledge about how to do
things better than the existing state of the art- where the know-how in
question was partly codified and partly tacit. It was argued that for such
know-how to generate profits, ‘it must be sold or utilized in some fashion
in the market. In almost all cases, the successful commercialization of an
206 P. Turner
innovation requires that the know-how in question be utilized in con-

junction with other capabilities or assets.’ These include technologies,
technology applications, unique knowledge or skills, differentiated mar-
keting elements such as customer or client information, or a unique cul-
ture that runs through organisational dynamics in a way that is difficult
to imitate. Other valuable assets include change management and the
ability to transform in the face of dynamic competitive environments or
such facets as exceptional human resource skills- ‘people are complements
when the skills of one enhance those of another within their team.’ In this
respect human resources practices are complements when one is com-
bined with another practice thereby raising output more than they would
if practiced independently. (Lazear & Shaw, 2007)
The hypothesis being proposed in this chapter is that success in com-
plementarity will depend on effectively leveraging organisational compe-
tence in ways that create a competitive position that is difficult to imitate,
and leadership and management competences that are applied to pro-
gression for the whole organisation to determine how and to what extent
synergies are achieved.
Organisational Competence-
from the Inside Out
Prahalad and Hamel’s definitive body of work examined the core compe-
tence of the organisation i.e. the collective knowledge within the organ-
isation that distinguished it from others. Introducing the concept
prompted not only the identification and focus on differentiators but the
examination and exploitation of the knowledge that led to such a posi-
tion. The ability of the organisation and its managers to do so was the
defining point. The argument was that organisations would be evaluated
‘on their ability to identify, cultivate, and exploit the core competencies
that make growth possib1e,’ even if this means rethinking the concept of
the organisation itself. In further developments, the authors argued that
competitiveness in the fast- moving environment that constituted the
Third Industrial Revolution and anticipated by the Fourth, would come
about by coalition building, competence accumulation, standards set-

ting, and market experimentation. This perspective supported the obser-
vation that success would depend on combining and leveraging internal
resources and processes to meet external demand- from the inside out.
(Hamel & Prahalad, 1994; Prahalad & Hamel, 1990, 1997; Ulrich &
Lake, 1990) It was argued that core competence should satisfy three tests.
First it should be organisation wide; second it should make significant
contributions to customer benefits and third it should be very difficult
for competitors to copy or acquire. (Arranz et al., 2019; Snyder & Duarte,
2003) Core competences should reflect the ability to coordinate the
deployment of assets and resources directly to objectives in an efficient
and effective way- an extension of the resource- based view. They are tacit,
complex, and firm-specific and therefore difficult to replicate and as such
can be sources of progression through complementarity. It was also noted
that ‘the bottom line of value creation processes is the organisation’s com-
bined capacity to employ their more or less unique, resources, their
intangible and tangible assets.’ (Nerdrum & Erikson, 2001; Wittmann
et al., 2009) Having valuable assets is not by itself and advantage.
Orchestrating and deploying those assets is.
The work of Barney (1996) and the VRIO model added significantly
to understanding by arguing that competence can be a source of sus-
tained competitive advantage if it creates value, is unique and rare, is hard
to imitate or substitute, and the organisation has reporting structures,
formal and informal management control systems which allow it to
exploit this competence. Critical to this was that organisations should be
able to identify opportunities and exploit those opportunities by virtue of
pre-emptive and consistent building of capabilities. In today’s environ-
ment, building of capabilities includes complementarity capabilities.
Amongst the many areas to which this assumption could apply, four are
of particular relevance. These are agile governance, innovation and trans-
formation, a culture that is responsive to change, and investment in com-
plementarity focused human resource practices. If complementarities are
to be achieved by leveraging core competence, then these four areas will
be of particular focus. These are discussed in more detail below and sum-
marised in Table 8.1:
Table 8.1 Organisational, Leadership and Managerial Capabilities and Competences for Complementarity
208
Leadership and Management

Organisational Capability and Competence Competence
Knows Organisation structure designed to facilitate delivery and Demonstrates agile governance in
what to maximise synergies of complementarity identifying and delivering
do Characterised by agile governance and responsiveness to complementarity opportunities
complementary opportunities Defines and prioritises what is crucial to
P. Turner
Responds by organisational agility as a dynamic capability critical do in the delivery of complementarity

to capturing complementarity benefits objectives
Has processes that facilitate cross-domain alignment and Maintains course and manoeuvrability
coordination of functional strategies in aligning complementarity objectives
Has systems in place to ensure congruence and that elements of with overall departmental, business
the strategy reinforce each other towards complementarity goals unit or organisational objectives
Elements, sets and bundles combined to provide opportunity for Maintains an open mind about ideas
complementarity and suggestions for complementarity
opportunities
Knows Systematic integration of strategic processes as part of strategy Knows when to allocate resources
when to setting and resource allocation understanding how this will impact on
do it A climate to maximise the creation and dissemination of other projects or initiatives
Knowledge Coordinates complementarity initiatives
Reward systems perpetuate a culture of sharing and collaboration and ensures they are integrated with
processes and actions in pursuit of
wider objectives
Seeks and disseminates information
about complementarity initiatives
within or without of the area of
responsibility
Is decisive about the timing of
complementarity initiatives and keeps
teams from being mired in debate
Knows why Systems and processes to create and capture unique areas of Collaborates and cooperates to create
it is being knowledge and share knowledge and information
done Knowledge used to identify patterns or profiles related to to expand the potential for
8
performance outcomes complementarity

Knowledge is disseminated throughout the organisation Collaborates and cooperates to receive
Collaboration is an essential part of organisational culture knowledge about wider organisational
Metrics created to identify the outputs of complementarity in initiatives
respect of all areas of business performance Understands technology applications
and how these inform the potential of
complementarity
Aligns complementarity initiatives to
wider integration initiatives ensuring
that all are consistent with desired
business outcomes
Knows Coherence in complementarity initiatives to ensure alignment Competence to integrate multiple
How between expected outputs and actual performance systems and processes
Asset and resource orchestration to combine advantageous Seeks complimentarities through
resources is part of the wider organisational strategy setting synergies that result from this
and resource allocation process integration
Allocates resources to areas of maximum complementarity Ensures sufficient resources allocated to
Focusses on consistency between the intent of complementarity complementarity initiatives
initiatives and the strategies and actions to deliver them- aligns Builds and sustains relationships both
structure to new requirements within and without the area of
Seeks insights from modelling clusters of interconnected immediate responsibility to facilitate
structures and practices integration and improvement
Utilises best fit change practices to move from present to future
Complementarity and Competence-knowledge, Skills…
state
(continued)
209
Table 8.1 (continued)
210

Knows Recognises the value of social complexity to competitive Communicates vision and purpose and
how to progression clarifies the role of the workforce in
behave Ensures job enrichment, job involvement and job determination their delivery
P. Turner
in pursuit of complementarities Adopts values based leadership

Develops and rewards a culture responsive to change Engages and Develops the Workforce to
Invests in clusters of complementary human resource practices identify opportunities for
complementarity within and without
their own domains
Aligns talent management intiatives to
those of workforce and employee
engagement to deliver
complementarity outputs
Builds a culture in which employees feel
empowered
Enables cooperative capabilities
• Agile Governance
The merger of physical assets and new digital technologies will allow
organisations to be more flexible and responsive using data-driven deci-
sions in a fast moving and unpredictable environment. Where this is
effective it can enhance organisational capability and strategic processes
such as entrepreneurial action and coevolutionary adaptation. The ability
to improve outcomes will also depend on agile governance- converting
latent potential to actual performance; by integrating, building, and
reconfiguring internal and external capabilities or structures. Because the
causes of change are complex, multi- faceted and multidimensional, the
responses will need to be dynamic. ‘In the first place, organisations will
progressively move from an environment of siloed, fixed location work to
one of interdisciplinary, interorganisational collaboration.’ They will
move from being rigid or risk-averse to agile and adaptable. Change
will be driven by effective processes, a responsive organisational
structure, and a readiness to leverage new technologies. (Cimini et al.,
2020; Cohen, 2019; Sambamurthy et al., 2003; Turner, 2021) It is
increasingly an important feature in navigating the rapidly changing
world of the Fourth Industrial Revolution.
In this respect, agile governance is a concept that is intended to shift
the manner in which strategy and policy are generated, discussed, and
enacted; one that ‘sets the expectation that governance can and should be
more agile to keep pace with the rapid changes… driven significantly by
the development and deployment of emerging technologies.’ (WEF,
2019) Whereas governance is a term that is concerned with the mecha-
nisms through which authority is exercised, decisions are made, and
strategy is coordinated and enacted; agility is interpreted as the ability of
an entity ‘that exhibits flexibility to accommodate expected or unex-
pected changes rapidly, follows the shortest time span, uses economical,
simple and quality instruments in a dynamic environment and applies
updated prior knowledge and experience to learn from the internal and
external environment.’ Agile governance combines elements of both and
involves a ‘lightweight, collaborative, communication-oriented,’ account-
ability framework, which enables the strategic alignment of goals, perfor-
mance and risk management. (Luna et al., 2020; Qumer &
212 P. Turner
Henderson-Sellers, 2008) It means reacting to an unpredictable environ-

ment, adapting to change and aligning change methodologies to the
needs of a business unit; but it also means identifying the ramifica-
tions of change for areas outside of the unit and being proactive in
influencing or shaping the wider organisation and its processes
accordingly. It is a whole system application and will come about by
capability in sensing the need for change, responding in a tactical way,
and initiating change across the entire organisation strategically if this is
necessary and opportune. It relates to the comprehensive integration of
a multitude of business activities, maximising the positive effect of organ-
isational dynamics (as well as the ability to deal with unforeseen change
and to benefit from change.) The application of agile governance has
been identified strategically and operationally in such areas as supply
chain management or design thinking in lean start-ups- contributing
to complementarities that deliver results that are more than the sum of
isolated initiatives. In all cases the concept has an organisation wide inter-
pretation. (Lin, 2010; Soltanifesghandis, 2014; Tse et al., 2016;
Lichtenthaler, 2020; Luna et al., 2020; Feizabadi et al., 2021; Turner,
2021.) It will take place with an element of self- regulation on the
part of leaders and managers who feel empowered to identify and
discuss change beyond traditional boundaries. Agile governance will
include the creation of new forms or new mutually reinforcing systems
that give better results over those that would occur if such practices had
taken place independently of one another.
The parameters for its success are broad ranging from innovative
human resource management practice combinations on the one hand
to commercial activities such as the establishment of partnerships and
collaborations on the other; from technology capability which seeks to
deliver across the whole organisation on the one hand to an effective
interplay between product design, change management and strategy
development on the other. (Accenture, 2020; Boehm & Turner, 2004;
Klishma, 2021; Marhraoui & El Manouar, 2020; Pinel et al., 2013;
Rachmawati et al., 2019; Vickery et al., 2010) Agile governance will, of
course, need to be accompanied by effective systems and processes if its
benefits are to be realised.
• Innovation and transformation
There is a strong argument in favour of product, process and organisa-

tional innovation being combined to produce complementarity affects.
Strategies for their delivery can be mutually reinforcing because increas-
ing the level of any of them increases the marginal profitability of the
other. The second aspect of organisational competence therefore relates
to innovation and the capability to transform in response to the changing
environment. However, the Fourth Industrial Revolution brings a con-
text for which there is little precedent or best practice- ‘the value-capture
problem for innovators in the digital economy involves some different
challenges from those in the industrial economy. It inevitably requires
understanding the dynamics of platforms and ecosystems.’ (Teece, 2018)
It is likely that these new circumstances will test organisations to the limit.
A critical attribute therefore will be the ability to apply innovation and
transformation in the building of new platforms and ecosystems through
integrated technologies, and specialised knowledge, skills or techniques
in a way that delivers differentiated advantage. The objective is to create
an environment of technological innovation which can mean either
product or process innovations- product innovation refers to those prod-
ucts or services that are introduced to meet the needs of consumers and
process innovation are those new elements introduced into the produc-
tion process or the operation of a service. Or it can refer to non-
technological innovations including, for example, new marketing
strategies that differ significantly from those that the company has previ-
ously employed or wider innovations involving the implementation of
new methods or business practices, in the organisation of work, and in
external relations. In many cases, innovation brings the need for transfor-
mation of systems, processes, people and technology across the whole
organisation. Where such capability exists, then this would constitute an
inimitable attribute which is key to complementarity. Where that capa-
bility is actively exploited, then it is a source of advantage and business
progression.
Complementarity from the deployment of internal collaboration and
external competencies enhances the overall contribution to innovation
capability. Whilst the path to innovation and transformation is likely to
214 P. Turner
be contextual, there are some indicators as to how an environment might

be created in which they might flourish(Guisado-González & Pérez,
2015; Liao & Li, 2019; Miravete & Pernias, 2006; Papalia et al., 2018;
Wang et al., 2021)
• For example, innovation can be encouraged by structures and pro-

cesses that recognise and maximise individual competence such as cre-
ativity, internal collaboration between innovative or creative individuals
• Or through the efficient leverage of knowledge from external sources,
achieved in joint partnerships, supplier networks or learning from sup-
plier operational capability.
• Where cross fertilising innovation is evident between production ele-
ments, product design and business processes, complementarities
occur which produce results over and above those where organisational
strategies were independent.
• Process innovation influences non-technological innovation, resulting
in complementary benefits- for example between innovation strategies
and export activity.
Where the complementarities in innovation output have been tested,

the results demonstrate significant potential and useful indicators for suc-
cess since product and process innovations have a positive effect on
productivity.
In spite of the many identified positives, and even though there may be
technologies to deliver it, innovation is not a given. Instead, it will require
a structure that facilitates and emboldens innovation activity but also
systems and processes that capture the outputs of that activity and con-
verts this into actual benefits. Technology will be instrumental in driving
innovative effort, but it will be the organisation’s absorptive capacity that
will be instrumental in converting this effort into meaning. (Bogliacino
& Naranjo, 2013; Miravete & Pernias, 2006; Polder et al., 2010; Serrano-
Bedia et al., 2018; Teece, 2018) An additional facet of these competences
is a culture that is responsive to change and will enhance the likelihood
of complementarity outputs. Cassiman and Veugelers’ (2006) excellent
analysis concluded ‘Innovation management requires a tight integration
of internal and external knowledge within the firm's innovation process
to capture the positive effects each innovative activity has on the marginal
return of the other.’
• Culture Responsive to Change- Knowledge and Collaboration
Agile governance and innovation often bring with them the necessity
for transformation. However, when organisations have identified com-
plementarity opportunities by combining resources and capabilities,
there is the challenge of converting these into synergies and in turn pro-
gression. Two cultural factors are relevant here. First is the ability to adapt
and change successfully. This is in itself a source of advantage. But the
second opportunity is to convert this ability into a source of complemen-
tarity by exploiting the social complexities that are a feature of this
adaptation.
Social complexity relates to culture or the shared values and beliefs that
shape not only interpersonal relationships but also business performance.
Where there is such a culture- socially complex and therefore difficult to
imitate- it can be a source of competitive advantage and business progres-
sion. It will influence the realization of synergies and the delivery of
potential to which complementarity refers. Cultural fit, based on com-
mon or shared values, but also ‘which allows similarities as well as differ-
ences that mutually support each other—rather than on cultural
similarity’ is therefore important. There is evidence for example that cul-
ture and strategic complementarity, are indicators for success- ‘it is not
only economies of sameness that foster value creation…but, moreover,
economies of fitness.’ (Anning-Dorson, 2019; Bauer & Matzler, 2013)
However, for a culture of cooperation to take effect ‘it is extremely advan-
tageous to know what other people want, judge, feel, think, and will do.
Moreover, many kinds of complex mutually beneficial cooperation
require this kind of complementarity: communication, exchange, divi-
sion of labour, joint action, meeting at a known time and place, planning
a schedule for the flow of work, conducting a complex ritual, making
joint decisions and committing to collective behaviour.’ (Fiske, 2000)
Where there is a uniqueness of culture- of which social complexity is
an element- there is the potential for differentiation and advantage.
Uniqueness can be seen in rituals, behaviours, attitudes, legends, routine
216 P. Turner
management systems, human resources systems and language. These

come together to form a system of shared meanings defining good and
bad, right and wrong and the appropriate ways for members of a working
group to think and behave. (Genc, 2013; Watson, 1995) Culture can be
determined by power often in the hands of key individuals who then
radiate the power from a strong centre; or it could be determined by role-
most often found in hierarchies with the implication of a rule- based
culture. It could also be based on task—characterised by the flexibility
and decentralised control of matrices. Or it could be based on person-
where the individual is the cultural focus (Grint, 2006). An assumption
that permeates these interpretations of the meaning of culture is that
determining activities take place over time, are embedded and based on
the ‘socially significant actions’ of individuals as they interact with each
other. Hence, culture and climate are produced by interactions between
employees and reflect norms and values and attitudes; and are influenced
by leadership and management and how employees perceive authenticity
and trust in managers supervisors. (Turner, 2020) In this case it is how a
unique culture can be used to deliver complimentarity.
The realisation of complementarity benefits will require proactive and
deliberate investment on the part of the organisation and a culture, sys-
tems and processes that facilitate resource allocation accordingly.
• Investment in complementarity focused human resource practices
Human resource practices directed to the achievement of complemen-

tarity have the potential to elicit a range of people behaviours which in
turn lead to higher productivity levels and corporate performance. Hence,
‘if applying more of one practice increases the effectiveness in terms of
knowledge creation, integration, and utilisation to applying (more of )
another practice’ and in which ‘the set of practices originating from vari-
ous areas of HRM activity whose combined application can be rationally
justified and empirically demonstrated to have a synergistic effect on
organisational performance in a given sector.’ These practices could be
viewed across multiple operational areas. A study of four of these- staff-
ing, remuneration, training, and performance assessment- concluded
that the greater that practices from different areas of human resource
management were complementary, the more they improved organisa-

tional performance. (Barrette & Carrière, 2003) Innovative combina-
tions of human resource practices are more beneficial than changes to
individual work practices. (Laursen & Mahnke, 2001)
‘For example, various forms of teamwork are made more effective if
responsibilities are delegated to team members because it allows them to
bring to bear their existing knowledge and to develop new knowledge
for tasks that managers up in the hierarchy are unable to understand.
Likewise, internal training might assist quality circles by blending lead-
ing practices developed in one part of the organisation with local knowl-
edge in another part. ‘
Furthermore, teams were found to be more productive when team

members were better trained, or were given team-based incentive pay, or
were selected for skills that were complementary. These points support
the concept that human resources practices can be complements, where
doing more of one of them increases the return to doing more of the oth-
ers. Such practices focussed on teamwork, training, and recruitment pro-
duced evidence of an impact on customer satisfaction and operational
efficiency. Investing in clusters of human resource practices that can pro-
duce complementarities is therefore an important aspect of resource allo-
cation for the organisation.
Previously it has been argued that the activities of talent management,
when combined with and complementary to the activities of employee
engagement, produce more than the sum of the benefits of each when
treated as singular events. However, they will only do so when the organ-
isation recognises the potential of this statement and invests accordingly.
This aspect of core competence will be influenced by both the context
and characteristics of each organisation which will deliver solutions with
clusters of human resource practices according to their own capability.
(Barrette & Carrière, 2003; Laursen & Mahnke, 2001; Lazear & Shaw,
2007; Singh et al., 2017) Recognition of the value of social complexity to
competitive progression will feature heavily in the nature of such deci-
sions. Organisational competences are sometimes contextual, relevant to
a point in time, or core such as adapting to change or agile governance
218 P. Turner
that have traversed time and can be identified at many way points during
the Four Industrial Revolutions over the past 250 years. The same obser-
vation can be applied to the competences needed for effective leadership
or management. Generic skills such as complex problem solving, critical
thinking, creativity, people management, coordinating with others, emo-
tional intelligence, judgement and decision making, service orientation,
negotiation, and cognitive flexibility are relevant over many different sce-
narios, and are important in the quest for complementarity.
Leadership and Management Competence

Complementarities in leadership and management are twofold. In the
first place between the functions of leadership and management or
between leaders and managers in teams at various levels—for example
when a senior management team has cooperative competencies, the out-
put would be difficult to replicate, creating a socially complex set of oper-
ating conditions. (Tyler, 2001) Second there are complementarities
between the actions of leaders and managers and the resulting organisa-
tional outcomes. The challenge with the advent of the Fourth Industrial
Revolution and Industry 4.0. is for leaders and managers to operate effec-
tively in new types of business model which, whilst continuing to develop
attractive products and services, will do so in the context of technologi-
cally advanced value chain processes and systems, new forms of risk man-
agement and a transformation of work and its environment. Success will
invariably require agile governance on the part of the organisation, its
leaders and managers. The objective will be to convert the intangibles of
structure and culture into the tangibles of business performance and pro-
gression. Here, competence is concerned with ‘the ability to sustain the
coordinated deployment of assets’ in ways that help the organisation to
achieve its goals. This attribute may be referred to as core leadership and
management competence- knowledge, skills, attitudes and behaviours-
which an individual possesses, and which is important for performance
within a specific business context. (Sanchez, 2004; Shamim et al., 2016;
Sparrow, 2000; Stepanenko & Kashevnik, 2017; Turner, 2021). To
achieve complementarity, leadership and management competence will
take account of the holistic nature of an organisation and regard it as an

open system. This means addressing ‘the multiplicity of individual and
institutional interests that intermingle in and are served through any
organisation.’ A requirement is that leaders and managers are able to
define organisational goals ‘that promise a satisfactory level of goal
achievement for all individual and institutional providers of the essential
resources the organisation needs.’ (Sanchez, 2004). The delivery of com-
plementary benefits adds a further element in that the goals and objec-
tives become not only departmental, functional, or related to a single
business unit, but have the additional element of a cross organisational
context. Leaders and managers will require a broad range of competences
to deliver this stretching scenario.
• Knows what to do
The primary requirement is knowing what to do to deliver opportuni-

ties generated in a new, dynamic environment. Conventionally, the
‘know what’ of management requires knowledge of strategic direction;
knowledge of technology and how it will help to deliver these aspirations,
and knowledge of the effect on people and organisational dynamics as a
result of adopting a particular strategy, system, or process. Of particular
relevance to the competence issue, in order for organisations to leverage
this knowledge (such as technological knowledge) leaders and managers
should have understanding about the applications, their features, and the
ways in which other competitor organisations are using them. However,
the dimension of complementarity adds to the element of defining and
prioritising what is crucial for the delivery of additional opportunities. It
is essential to appreciate the impacts of new or innovative systems and
processes on all areas of the business- they are recipients, disseminators
and interpreters of knowledge. It is the latter of these attributes that will
inform what to do to deliver compound benefits. This not only applies to
the application of existing knowledge but in that of new knowledge, since
new knowledge is generated mainly by means of the recombination of
both pre-existing and parallel units of knowledge. (Antonelli, 2003; Luna
et al., 2020; Nakata et al., 2010; Turner, 2021)
220 P. Turner
‘Such recombination is both synchronic and diachronic. Diachronic,

vertical, recombination consists of the reorganization of elements of
knowledge role acquired in the past with new bits and insights recently
elaborated. Here the Newtonian understanding of the production of sci-
ence as ‘standing on giants’ shoulders’ identifies a key attribute of
knowledge complexity such as cumulability, i.e. the cumulative comple-
mentarity indivisibility between different vintages of knowledge.
Synchronic complexity and the related horizontal recombination activi-
ties stress the complementarity between the parallel and contemporary
acquisition of new bits of knowledge.’
The implication of this important finding is that in addition to exist-

ing processes of strategy setting, supported by well tried and tested sys-
tems, seeking complementarity will require an open mind about ideas
and suggestions for how to achieve it, outside of convention. This attri-
bute involves deciding between what is important and what is essential;
what is fixed and what can be changed and what actions are necessary to
affect the delivery of enhanced benefits. Knowing what to do in these
circumstances is considered to be one of the most important compe-
tences alongside clarity of goal setting and clear communication of expec-
tations. (Giles, 2016) On the one hand it will be concerned with ensuring
the achievement of a unit’s operational objectives- existing knowledge;
but on the other it will be concerned with identifying opportunities and
allocating resources to complementarity initiatives- combination and
recombination of knowledge. This will require making priority decisions
in the interests both of the department or business unit and of the organ-
isation as a whole. It means maintaining course- business as usual- but
also the ability to manoeuvre if the opportunity presents itself- business
not as usual.
• Knows when to do it
The success of a business strategy will depend on its alignment with the
organisation’s goals and objectives, and how this takes place, accentuating
the importance of knowing when to take action and to maximise the co-
presence of alignment practices which have been shown to be more
valuable than the same practices in isolation. Critical factors will be effec-
tive operational practices including impact, timing, and potential com-
plementarity of practices(Vermerris et al., 2014):
‘it is important to know the required ingredients in order to prepare a

certain meal. But it is still difficult to create the meal unless the timing
of when to add which ingredient and when to cook for how long
is unknown.’
Whilst various elements contribute to the success of strategy or associ-

ated actions, such as communication, shared knowledge of objectives and
processes, management commitment and measurement of outcomes, it is
timing- knowing when- that can be the difference between success and
failure.
The pace of change and hence the pace of opportunity adds to a par-
ticular aspect of leadership and management competence which is con-
cerned with seeking and disseminating information and using that to
coordinate processes and actions. At the same time, it is important to
ensure that the likely external pace of change and opportunity is matched
by rapidity of internal decision making and processes. The probability of
a consensus approach to decision making, devolved authority and
empowerment both add to and detract from this process. And so, whilst
debate is essential, being mired in debate is not. Competence will include
preventing teams from this latter course. (Luna et al., 2020; Turner, 2021;
Vermerris et al., 2014) It will involve striking a balance between the sur-
facing and application of knowledge with the pragmatism of achieving
advantage. Knowing when to take decisions and when to act on their
outcomes is a feature of this.
• Knows why it is being done
Complementarity will be successful if the rationale for its pursuit is

known throughout the organisation. It is for this reason that an impor-
tant competence on the part of leaders or managers is their ability to
choose and then prioritise since not all the strategies have the same effect-
on innovation performance for example. (Serrano-Bedia et al., 2018)
222 P. Turner
Knowing what to do and when are the foundations on which to build the
approach to the opportunity. The success of these will also be enhanced
by the reasons or justification for particular courses of action; hence,
awareness of the know why of complementarity. The essence of this is the
argument that complementarity creates the potential for greater synergy
which can lead to higher long term business performance. Amongst its
facilitators are new technologies, their applications and impact on the
business model. Knowing why will enable decisions that create valuable
and unique synergy; and will inform the allocation of the right resources
to the right place at the right time. However, ‘the existence of such
resources is a necessary but insufficient condition, and the resources must
be effectively integrated to realize the synergy.’ (Harrison et al., 2001)
Knowing why a particular course of action is being taken is part of a
wider engagement platform of the ‘why of work’ which also translates as
meaning at work which, when in place, has significant benefits for both
the employee and the organisation since ‘those who find meaning at work
are more competent, committed and contributing; in turn employee
competence commitment and sense of contribution lead to increased
customer commitment; in turn customer commitment leads to better
financial results for the company.’ (Ulrich & Ulrich, 2010) In the context
of leadership or managerial competence the ‘knowing why’ relates to how
well the goals and objectives of complementarity can be related to the
broader goals and objectives of the organisation. It is the role of the man-
ager to see beyond the limited scope of single incidence integration (such
as that relating to a specific unit) and where possible take an organisation
wide perspective, and regarding the organisation as a complete entity.
(Turner, 2021) It will inform how complementarity can contribute to a
broader organisational canvass.
• Knows How to do it
Integrating multiple systems and processes, together with seeking syn-

ergies represent the know- how. It is the practical application of ideas,
concepts, knowledge, techniques, methodologies, systems, or processes
that both the organisation and its leaders and managers possess in the
development and creation of products and services. It is a dynamic
capability which is ‘the subset of the competences/capabilities stocks of

complementary know-how and other assets, which allow the firm to cre-
ate new products and processes and respond to changing market circum-
stances.’ ( Teece & Pisano, 1994) Know how can produce economies of
scope, derived from use in multiple business applications of the organisa-
tion’s underlying expertise or from the transfer of knowledge between
business units. (Helfat, 1999) The process of transfer is unlikely to be
automatic, but instead will require proactivity and willingness to engage
within and without the units for which they have responsibility. There are
three elements to this aspect of competence. In the first place there is the
ability to understand the implications of multiple systems and the pro-
cesses required for their effective implementation. Hence, integrates mul-
tiple systems will be an important aspect. Second is the ongoing process
of improvement gained from prior experience or new knowledge. And
finally, there is the essential characteristic of ensuring sufficient resources
to enable integration to work effectively. A definition of this competence
might be put forward as ‘integrates multiple systems and processes and
seeks continuous improvement.’ (Turner, 2021) Critical to this will be
the ability to build and sustain relationships in the process of integration
and improvement.
It is argued that those organisations that are able to find ways of using
intangible knowledge assets toward value-creating capabilities, such as
innovativeness, prosper. This assertion is supported by the finding that
complementary resources, for example the technology know-how of
computer engineers and the customer know-how of marketers, result in
better capabilities when combined than if only one is present or they are
managed independently (Nakata et al., 2010) Leadership and managerial
know how will determine the extent to which the knowledge of individ-
ual members of the organisation and its valuable and rare assets are
deployed to optimum effect.
• Knows How to Behave
Identifying and evaluating the potential of complementarity forms the

base case. Having organisational and individual competence to deliver,
underpin the possibility. An important issue in support of these is not
224 P. Turner
whether an organisation adopts a particular work practice to enhance

complementarity, but ‘how that work practice is implemented in con-
junction with other complementary practices.’ Knowing ‘how to behave’
will be critical in engaging the workforce in the process of integration and
change towards complementarities. Building a culture in which employ-
ees feel empowered is an important aspect of competence which is mani-
fested in both workforce engagement and employee development not
only to identify opportunities within their own domains but also with-
out. This involves cooperation that can be explicit-oriented or tacit-
oriented knowledge creation and dissemination. ‘Integrating external
with internal knowledge source increased the probability of obtaining a
higher level of organizational performance.’ (Choi et al., 2008;Turner,
2021)
It is argued that amongst the social complexities that can differentiate
one organisation from another and lead to sustainable advantages are
cooperative competencies which can complement technological compe-
tencies for innovation and ultimately progression. Resource-based analy-
sis has shown that ‘above average cooperative capabilities (i.e. competencies
relevant to information processing, communication, knowledge transfer,
intra- and interunit coordination, the ability to develop trusting relation-
ships, and negotiation) … can be expected to provide firms with a com-
petitive advantage that is not easily imitated or competed away (Tyler,
2001).’ It is therefore important that leaders and managers have the com-
petence to facilitate an environment in which such co-operative capabili-
ties are given full rein with a view to maximising their outputs. Knowing
how to behave will be instrumental in creating and delivering to this
environment.
Conclusion
There is a body of research evidence to show that complementarity can be
achieved by judicious management of such aspects of organisational
strategy and practice as product innovation, process innovation, and
non-technological innovation. Indeed, to achieve desirable and useful
complementarity requires both a strategic approach to organisation, lead-
ership and management through effective strategy, policy, and
stewardship on the one hand, and a breadth of competence during imple-

mentation. Symbiotic complementarity leads to value added by the inter-
action of different elements, and pooled complementarity happens when
value added is created by interacting with similar elements. (Guisado-
González & Pérez, 2015; Kinderis & Danieliene, 2019; Nielsen &
Hunter, 2013) Two further factors will contribute to success. First is an
understanding of the conditions in which decisions are taken to generate
the desired effect; and second what are the organisational and individual
competences required to implement any outcomes of these consider-
ations. In respect of the former, agility and agile governance as well as
strategy setting processes and the ability to allocate resources to comple-
mentarity generating initiatives are critical. The ability to deliver to these
requirements will be dependent not only on the organisation’s structure
but also on the way it is led and managed and this leads to the second
aspect of competences for complementarity. Knowing what to do and
when; knowing why it is being done, how to do it and how to behave are
therefore key facets.
Progression through complementarity will involve choice in which
combination of resources, assets or capabilities will make the most differ-
ence and how to allocate those resources to ensure maximum return. As
competition increases or the terms of competition begin to change, these
decisions will depend on the ability and the nature of the organisation’s
structure and culture to implement them. This is because commercial
success often ‘swings upon the terms and conditions upon which the
required complementary assets can be accessed.’ (Teece, 1986) .The chal-
lenge is not only recognising that such uniqueness exists but in convert-
ing this into a workable formula and translating it into a business model
which can in turn be implemented effectively. For the purposes of this
book complementarity has been referred to as the interaction of business
strategies and management practices which then produce coherent,
aligned and mutually reinforcing systems and processes that give superior
outcomes over those that would occur if such strategies or practices had
taken place independently of one another. It is where the complementary
agency of those strategies produces superior results, where the relations of
independent units or their evolution creates higher value than their indi-
vidual operation. Delivering value in this definition will depend on
226 P. Turner
organisational competences on the one hand and individual ones on the

other- particularly leadership and management competences- to facilitate
the process.
The benefits of complementarity will not be realised without compe-
tence. This is competence at organisational level covering agile gover-
nance and the creation and perpetuation of a culture of collaboration,
and at individual level where leaders and managers have the nous and
capability to enact these requirements.
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9
Complementarity in Business
Organisations- 20 Important
Conclusions
Complementarity and Business Progression

The objective of a business organisation is to achieve progression by using
the energy and resources contained within and converting them from
latent potential to actual force.
To support this movement, business philosophies, methods, and pro-
cesses have evolved over time, occurring in a sequence of challenge and
response as each Industrial Revolution created new opportunities. From
the principles of Division of Labour emerged hierarchical organisation
and a Weberian understanding about social relations within those hierar-
chies. Then came a scientific followed by a human relations view of man-
agement to take advantage of economies of scale and economies of scope.
In recent decades the advent of globalisation has brought with it new
approaches to strategy, to the organisation design to support that strategy
and innovations in leadership, management, talent, and workforce
engagement. Convention has come to mean that progression could be
achieved with a vision or mission by which the organisation is guided,
specific objectives in how to convert this aspiration into practice, and
strategy, stewardship, and policy to ensure that those responsible operate
https://doi.org/10.1007/978-3-031-10654-5_9
234 P. Turner
within clear and specific boundaries in such areas as legislation, resource

allocation and budgetary control. Contemporaneously, business progres-
sion also means achieving economic growth whilst seeking a positive
effect on society as a whole, exploiting synergies- such as complementary
CSR strategies. And now, a Fourth Industrial Revolution provides a pow-
erful impetus for change- a confluence of new technologies creating
opportunity to those able to harness their potential.
To achieve their objectives, organisations strive for coherence, congru-
ence, and consistency in strategy, developed and applied with agility, with
competent leaders and managers, utilising the skills of a fully engaged
workforce in an agile and responsive structure. These concepts and the
language of business management are part and parcel of organisational
life. Many will continue to be relevant, but new technologies will create
an environment of unprecedented volatility bringing conventional mod-
els of strategy and organisation into the spotlight. The dynamism of
change in the global economy will require methods and techniques
applied in a radically different context, requiring the orchestration of
assets in untested ways. Organisations will adapt by refining strategies,
redesigning structures, and identifying unique or rare resources to be
applied in ways that are difficult to imitate on the part of competitors.
Such resources can be tangible e.g. technology or intangible e.g. unique
culture or innovative approaches to workforce management. (Cavaco &
Crifo, 2014; Popa et al., 2016) The effective, complementary combina-
tion of both can lead to improvements in a range of performance mea-
sures from profitability to innovation performance. The challenge facing
organisations is to identify unique resources, demonstrate how they may
be integrated into powerful combinations, and to deploy them efficiently
and effectively. Amongst the potential strategies for so doing is that of
complementarity, whereby the outcomes of singular initiatives will be
improved when they take account of the potential synergistic opportu-
nity with other initiatives. Progression through complementarity will
have occurred when coherent, aligned, mutually reinforcing business
strategies and management practices give superior outcomes (such as
shareholder value, profit, customer satisfaction, market share or cost
reduction) over those that would occur if such strategies or practices had
9 Complementarity in Business Organisations- 20 Important… 235
taken place independently of one another. It is where the complementary

agency of those strategies produces superior results.
omplementarity- Continuous Evolution;

C
Diverse Meanings
The evolution of the concept of complementarity has generated multiple
meanings at each of its many iterations. It has a foundation in quantum
physics, based primarily on the debates initiated by the work of Nils Bohr
(1929, 1957) extended to wider fields of knowledge and experience,
intertwined with a range of philosophical questions ‘concerning such
basic subjects as subject and object, space time and causality, chance and
necessity, and so on.’ (Katsumori, 2011) And it has a foundation in eco-
nomics based on the evolution of demand theory debated over time by
economists such as Edgeworth, Pareto, Fisher, Hicks and Allen. (Lenfant,
2006; Samuelson, 1974) Complementarity has been applied to concepts
at the abstract level in religion or philosophy; it has been used to inform
practical issues in areas such as the demand and supply of goods and ser-
vices; the import- export trade or the teaching of science, and it has con-
tributed pragmatic theories in the technological sphere. Its applications
stretch from government macro- economic policy to global financial
regulation, from industrial development to individual behaviour.
In addition, with a great number of insights from different disciplines,
the concept has gained credence in areas of business and organisation
through the seminal work of Teece (1986, 2018); Teece & Pisano, 1994,
and Milgrom and Roberts (1990); Milgrom et al., 1991 with Barney’s
(1991, 1996) resource- based theory of the firm providing a language
from which the concept could evolve. Firstly, complementarity is used to
explain that mutually exclusive events or characteristics can come together
to form a complete whole. That is different phenomena are complemen-
tary when they are mutually exclusive, but they are all necessary for a
comprehensive account of these phenomena. (Wang & Busmeyer, 2015)
This principle is based on the ‘dualistic, dialectically contradictory
essence’ of the phenomenon studied. Secondly, is that opposites when
236 P. Turner
taken together build a complete picture- yin and yang. Thirdly there is an
interpretation based on the idea of wholeness, but seeing complementar-
ity as not necessarily based on mutually exclusive phenomena. Where, for
example, individual personality traits attract responses from those with
similar traits resulting in complementary actions; or where complemen-
tary goods are used together. Examples of which might be ‘right and left
shoes; razors and blades; cake and icing; horses and carriages; cars and
highways; TV sets and TV shows; computer hardware and software; and
tea, hot water and a cup. The value of a group of complements in joint
use is super-additive, that is, the things used together are more valuable
(to someone) than the sum of their values in separate use.’(Baldwin,
2018) Fourthly, complementarity is a relationship between one factor
and an associated, related factor- complementary synergies between fac-
tors. Subsequently, research studies have tested the hypothesis with results
across many industrial and commercial sectors. But there is no universal
definition. Indeed, it has been argued that ‘in the history of scientific
thought it is hard to find another central contribution about which the
opinions continue to differ so sharply. Some… consider complementar-
ity as the most profound intellectual insight of the twentieth century, as
a pinnacle of physical understanding of nature, no less inevitable than the
emergence of man himself as a product of organic evolution.’ And yet
others criticise complementarity as an ‘obscure ‘double-think.’ (Beller,
1992) Instead, and as the concept came to be applied in settings other
than quantum physics, several different interpretations have been put
forward.
Complementarity- Definitions
in a Business Context
Teece’s (2018) contribution to understanding complementary in com-
mercial environments has been significant for over 30 years. His sum-
mary of the economic definitions of complementarity included ‘Hicksian’
or Production Complementarity. This was where factors of production
were complements when a decrease in the price of one led to an increase
in the quantity used of its complements in production. The second was

referred to as the Edgeworth/Pareto or Consumer Complementarity
which occurred if the utility of consuming two goods together was greater
than that of consuming them in isolation. A third interpretation was that
of Hirshleifer or Asset Price Complementarity which was a financial per-
spective about profit from an innovation. Two other types of were
Technological Complementarity which occurred ‘when the value of an
innovation depend ed on altering the nature of one or more existing tech-
nologies and/or on creating new ones;’ and Innovational Complementarity
where improvements in a general-purpose technology increased the pro-
ductivity in downstream sectors such as a cellular network creating
opportunities for those providing wireless data devices. But these weren’t
the only interpretations based on economic theory. Puka and Jedrusik’s
(2021) excellent summary of the many different interpretations of com-
plementarity -building on Berry et al.’s (2021) valuable work highlighted
quantitative complementarity which occurs when an increase in the
quantity of one good leads to an increase in the value of another- an
example cited was that of a right and left shoe- as well as qualitative
complementarity where an increase in the quality of one good leads to an
increase in the value of quality of another good. In this case the example
of a suit paired with a tie was used. They discussed ‘within a category
complementarity’ where ‘a basket of goods within the same category is
selected in such manner as to best suit the customer’s current needs, e.g.,
a home film library.’ This was contrasted with cross-category comple-
mentarity where goods from different categories relate to each other to
achieve a greater value for the consumer, such as milk and cornflakes, or
software and hardware. Provider-driven complementarity was where
‘independent goods become complementary if they are delivered by the
same provider (often within a brand or series), e.g., banking services and
brokerage services.’
With the progress of time, it is no longer possible to interpret comple-
mentarity solely as a binary relationship between two goods (and an indi-
vidual) ‘taken apart from the context of choice. On the contrary, the
context of choice is a constituting part of the definition.’ (Lenfant, 2006)
And given the importance of the subject, there is support for Samuelson’s
(1974) view that ‘the last word has not yet been said on this ancient
238 P. Turner
preoccupation.’ The rich and diverse debate continues with multiple defi-
nitions emerging from theory and practice.
Complementarity and Business Practice

Hence, across management research, complementarity has been used to
predict the sustainability of competitive advantage, rent appropriation
and superior innovation outcomes-it has been used to explain success in
the emergence of novel technologies and its role in innovation. Cited
examples include in the field of automobiles, which require a network of
gas stations, as well as a road infrastructure, support businesses such as
repair shops, specialized suppliers, and insurance services. Taking the
logic a stage further, smart phones require base stations, the internet,
software applications and so on. In retail, the inter-action between the
technology infrastructure and e-commerce generated complementarities
that contributed to improvements in performance through sales per
employee, inventory turnover and cost reduction. The complementary
use of IT resources to build system integration and business process coor-
dination capabilities was the key mechanism in creating greater business
value. (Hsu, 2013; Markard & Hoffmann, 2016; Soda & Furlotti, 2017;
Yu et al., 2011) And finally complementarity was shown to emerge from
the interaction of either homogeneous or heterogeneous units or ele-
ments, such that relations of independent units or their evolution creates
higher value than their individual operation. The argument here is that
two activities are complementary when the adoption of one increases the
marginal returns of the other and vice versa. Complementarity will be
influenced by strategic choices, the orchestration of resources, the devel-
opment of relationships with partners, customers and distribution chan-
nels. The greater the level of interaction, the greater probability of
complementarity. (Baldwin, 2018; Choi et al., 2006; Fedele & Mantovani,
2008; Furlan et al., 2011; Gao, 2004; Kinderis, 2019)
Undoubtedly, the Fourth Industrial Revolution offers a particular
opportunity to take advantage of complementarity benefits. This is
because of the potential of e- commerce and e-business- complementarity
creating relationships between internet technologies and other elements
within the organisation with positive returns from investments in these

technologies. Data-driven business models such those used by Amazon
or Netflix offer complementarity opportunities by collecting, organizing,
and summarizing data, to identify customer needs. (Xu et al., 2020) New
technologies won’t necessarily give superiority or advantage, but that rela-
tive advantage can be created and sustained where the technology lever-
ages other critical resources. Resource complementarity creates the
potential for synergy leading to performance improvements- ‘the valu-
able, unique, and inimitable synergy that can be realized by integrating
complementary resources provides an opportunity for the firm to create
competitive advantages that can be sustained for a period of time. In
addition, complementary resources present opportunities for enhanced
learning as well as the development of new capabilities.’ (Harrison
et al., 2001)
Nevertheless, whilst it has the potential for advantageous positions in
any particular market or sphere of activity, it is not a ‘given’ and can will
emerge from jointly constructed interactions with multiple potential
partners through recursive cycles. (Afanasyev et al., 2015; Deken et al.,
2018) Furthermore, ‘rather than one best way of organising, comple-
mentarities suggest that the effectiveness of one organisational element
may be dependent on the presence or absence of another particular ele-
ment. Consequently, organisational arrangements often display multiple
equilibria or what is known as equifinality, whereby multiple pathways
may lead to the same or similar outcomes.’ (Jackson & Ni, 2013) Each of
these interpretations may have resonance in the context of the dynamics
of the Fourth Industrial Revolution and how individual organisations
deal with the outcomes of significant technological and social change.
Complementarity- Twenty Key Learning Points

A confluence of digital technologies is creating new types of work, new
types of work procedures and new organisational competencies, roles,
functions and structures and budgets. Furthermore, the landscape of
cooperation has broadened beyond traditional boundaries with new ways
of organising and new types of organisation design. The resulting dynamic
240 P. Turner
is a powerful catalyst for transformation and change. In response, organ-

isations are seeking alternatives to traditional approaches and their associ-
ated structures. Amongst these are greater vertical and horizontal
integration impacting on every aspect of the supply chain creating net-
works of strategic partnerships. These dynamics are important in under-
standing why complementarity is relevant in the business environment.
Throughout the evolution of the concept, with its many definitions or
interpretations, runs the theme that may be of particular benefit to the
business organisation as the Fourth Industrial Revolution gathers pace.
This is that there are benefits to organisations from not only considering
the singularity of management actions- meaning discreet interventions,
decisions, or strategies in response to challenge or opportunity- but also
by complementarity- that is interventions that connect actions, practices,
tasks, resources, or assets to others and to a broader purpose or goal. The
assumption here is that complementary clusters of business practices will
yield superior outcomes over and above the sum of their component
parts. Companies such as Google, Facebook, Uber, Apple, Spotify,
Airbnb, eBay, and Netflix have flourished by scaling up and leveraging
effective and complex relationships. (Aversa et al 2020) Although it is
also worth noting Teece’s observation that any definition of complemen-
tarity raised complex coordination issues. To be successful requires not
only the means but also the ways.
In the analysis put forward in the previous chapters, some of the prin-
ciples of complementarity as they pertain to business functions, and then
to the organisation as a whole were identified. This final chapter will pull
together the key aspects of complementarity through 20 key learning
points, highlighting the benefits of taking a holistic perspective when
considering the principles and definitions, areas of strategy, leadership,
management, talent and engagement and the dynamics of organisations.
These are presented below.
Principles and Definitions
An overarching objective will be to achieve competitive advantage that is

sustainable over time, in other words, competitive progression. The first
consideration of the utility of the complementarity concept therefore will
be in relation to this higher- level purpose. But how to reach this position
remains open with multiple interpretations and definitions. These range
from positions that are derived from within the area of quantum physics
with joint completion and mutually exclusivity as the core of the argu-
ment, through to the idea that opposites when taken together create a
complete picture. Further interpretations derived from economic theory
include complementarity as not necessarily based on mutually exclusive
phenomena such as where complementary goods are used together or a
relationship between one factor and an associated, related factor- i.e com-
plementary synergies between factors. The most straightforward interpre-
tation is complementarity in its literal sense where one article, goods or
service adds value to another- Tea and milk, Tennis Balls and Tennis
Rackets, Mobile Phones and Sim Cards, Petrol and Cars.
The variations in definition are compounded by the dynamic nature of
the context within which organisations operate. In particular the impact
of technological and social change inherent in the Fourth Industrial
Revolution. Nevertheless, it is possible for each organisation to identify
aspects of complementarity that are relevant to its own context and whilst
there is no single best practice definition of complementarity, its applica-
tion will be based on the context of a particular organisation or part of an
organisation- a best fit approach. The application will take place within a
generic framework or interpretation of the concept.
1. In this respect, complementarity may be seen as the interaction of

business strategies and management practices to produce coher-
ent, aligned and mutually reinforcing systems and processes that
give superior outcomes (such as shareholder value, profit, cus-
tomer satisfaction, market share or cost reduction) over those that
would occur if such strategies or practices had taken place inde-
pendently of one another. It is where the complementary agency
of those strategies produces superior results, where the relations of
independent units or their evolution creates higher value than
their individual operation. The nature of those interactions and the
resources allocated to ensure that these are designed to maximise com-
plementarity benefits. How to do so will be context specific. The con-
cept of best practice is replaced by that of best fit. Hence the importance
242 P. Turner
of analysis and identification during the process of strategy setting.

These activities will highlight those areas of the organisation that
satisfy the unique and inimitable criteria important in the resource-
based view.
2. The successful application of complementarity against the above defi-
nition will depend on creating value from the organisation’s resources
and which have been identified as of particular utility. Hence, com-
plementarity is concerned with identifying synergies that can be
realized by integrating the organisation’s valuable, unique, or
inimitable resources. That is, they are stronger than or cannot be
imitated by competitors. But complementarity is not about using
these resources in isolation from each other. Instead, they will be com-
bined or clustered together and in so doing will create new products,
services, or business models. Resources can include easily identifiable
ones such as new technology but also those that are less tangible such
as patents and copyrights or the organisation’s culture. Identification
of such resources is the first step, followed by integrating them into
strategy, stewardship, policy and process.
3. In the dynamic, transformational environment created by the new
technologies of the Fourth Industrial Revolution, competitive advan-
tage may only remain an advantage if an organisation builds in pro-
gression as part of its value chain. Progression means forward
movement in the generation and value of tangible assets, intangible
assets, and sustainable development. Complementarity holds that the
business phenomena of strategy, leadership, management, talent,
and engagement, have complementary properties which, if recog-
nised and directed, can have a broader impact than if they were
regarded as independent activities. A critical element in this will be
the organisation’s dynamics and hence a best fit organisational design-
informed by the need for agile governance to provide the responsive-
ness necessary to deliver complementarity advantages- will be an
essential additional characteristic.
These principles form the basis of a complementarity approach in busi-

ness organisations. However, as the history of the development of the
concept has shown, their application in practice will require proactivity
involving not only the optimal orchestration of rare or valuable assets but
a recognition of the sensitivity of the organisation’s dynamics. The success
of complementarity will depend on how well the people responsible for
its delivery bring together the many diverse strands necessary. It will
depend not only on a good strategy but a best fit organisation design,
competent leaders, and managers and a fully engaged workforce. A coher-
ent, congruent, and consistent approach to all aspects of the organisa-
tion’s dynamics.
Complementarity and Business Strategy
The route taken by the organisation as it moves towards an aspirational

vision or mission will be articulated in the form of business objectives
and a business strategy to achieve them. Strategy may be concerned with
directing several business units to attractive market segments in which
they are deemed to be competitive with corporate objectives such as
shareholder value or business unit objectives such as market share or cash
flow. And finally, strategy can also refer to a function within a business
unit such as technology or human resources. Once strategy has been
determined, then resources are allocated to support whatever actions
need to be taken in its achievement. Complementarity brings with it a
further consideration and that is the orchestration of assets in such a way
as to create value not only within a unit but without. ‘Complementary
assets’ such as technological know- how or process and system capabili-
ties- will be combined through the strategy setting process.
4. The base point in this assumption includes both process and culture.
In this regard there is an essential understanding within the organisa-
tion that the performance of the whole organisation will be
improved when there is complementarity between elements of
business strategy. This principle applies across the board extending it
from the norm based on technology applications. Hence, comple-
mentarities will be sought for example between the finance strategy
and the marketing strategy or between the production strategy the
people or human resources strategy. Hence, complementarity is the
antithesis of singularity. The hypothesis is that single issue competitive
244 P. Turner
advantage may not be the only option available to organisations in

future. As such, prosperity will not only come about by pace and agil-
ity; or by cost leadership or differentiation; but by the ability to make
sure that every investment creates advantage across the whole organ-
isation; and that such investments are mutually reinforcing.
5. In order for strategy setting to facilitate opportunity for complemen-
tarity, a system for ensuring cross-domain alignment and coordi-
nation of functional strategies will be necessary. This strategic
integration is aimed towards fully exploiting growth potential and
comes about by combining or orchestrating resources and compe-
tences towards the new business opportunities that may emerge from
economic transformation. The objective is to achieve what has been
referred to as the maximum-strategic-opportunity set, defined as
‘those opportunities that can let companies take the fullest advantage
of their capabilities and their potential to pursue new strategies.’
(Burgelman & Doz, 2001) Hence the necessity to integrate strategic
processes. Amongst the outputs of this focus will be asset orchestra-
tion by combining advantageous resources (that are rare or inimitable)
such as social complexity that can’t be copied by competitors. Once
again, this will require both processes and a culture that facilitate cross
domain or unit alignment. Strategy setting will have twofold objec-
tives. First to ensure that a particular function or unit has clarity about
its objectives, systems to achieve those objectives and resources allo-
cated to do so. Second, strategy setting will seek to identify where
functional or unit strategies can benefit others. Complementarity
replaces singularity.
6. In economic terms the theory of supply and demand is used to define
complementarity using measures of the responsiveness of demand for
one good to a change in the price of another good. However, Puka and
Jedrusik’s (2021) analysis added a range of definitions, two of which
are particularly relevant in determining the success of complementar-
ity initiatives. Hence, quantitative measures will demonstrate their
effectiveness in returns on investment, whilst qualitative measures will
demonstrate the value added to other strategies apart from the func-
tional one being considered. Measuring the outputs of complementar-
ity is important because it provides a case or justification (as measured
by return on investment) to support the alignment of domain

strategies, the orchestration of resources and investment decisions. If
the organisation’s business strategies are truly complementary,
then the effect of their complementarity will show up in measures
of performance. The objective will be to demonstrate that strate-
gies, when applied together are greater than any isolated additive
effects. What is measured, how it is measured and how it is converted
to explicit knowledge will ultimately determine whether there is busi-
ness support for the complementarity as a source of business
progression.
A ‘good’ strategy has a ‘kernel’ which contains three elements- these

being a diagnosis, a guiding policy and coherent action. (Rumelt, 2011)
The first two will be significant contributors to the organisation’s direc-
tion and its strategy on how to get there. The third element- coherent
action- will determine whether the aspiration implied by the direction
and strategy will be fulfilled. Coherent action will be dependent on lead-
ers and managers who have the competence, not only to recognise the
value of complementarity, but also to put together the ingredients to
make it work.
Complementarity, Leadership and Management
Competence and complementarity go hand in hand. This is because a

demonstration of competence on the part of leaders and managers is
causally related to effective performance. In this case, leadership and
management competence consists of knowledge- the retention and utili-
sation of information, skills- the ability to demonstrate a sequence of
behaviour towards a goal- and attitudes and behaviours- the social mani-
festations of how a manager undertakes a role. Competence can be spe-
cific, such as technology knowledge or that related to the business
domain, or generic, relating to interpersonal competences. It can be cat-
egorised as cognitive competence or work-related knowledge and the
ability to apply it; functional competence the ability to perform work-
based tasks; social competence or relational and communication skills;
246 P. Turner
and meta-competence or personal and professional values. Competences

form the know- how, know why, know what, know when and know how
to behave of management. Leaders and managers will require compe-
tence that span each of the above typologies if they are to deliver the
benefits of complementarity. An important assumption here is that the
performance of leaders will improve if leadership competences are com-
plemented by management competences; the performance of managers
will improve if they complement traditional management competences
with those traditionally ascribed to leaders.
7. Principles and strategies will only be effective if other organisational

resources are aligned with them. This will require leaders and manag-
ers who not only have the will or intent to make complementarity
work but the competences to enact it. To be effective therefore
requires that leaders and managers demonstrate agile governance
in identifying and delivering complementarity opportunities.
Agile governance itself is open to interpretation. It can be strategic
and relate to longer term objectives and direction; or it can be opera-
tional in respect of resource allocation and decision making.
Furthermore, it can include both narrow and broad change manage-
ment and a mindset- the willingness and capability to change. Agile
governance may therefore be defined as the ability to respond to
change in a dynamic and flexible way. (Turner, 2021) It is that
ability to respond to change in a way that is dynamic and flexible;
that adapts change methodologies and aligns them to the unique
context of the department or business unit; but simultaneously
recognises the implications of such change for areas outside of
the unit. For complementarity- a cross organisational concept
after all- to be effective will require agility and the ability to influ-
ence or shape the organisation and its processes accordingly. This
can be articulated as knowing what to do.
8. Knowledge creation, dissemination and exchange, joint actions to
solve problems, joint planning, making joint decisions and commit-
ting to collective behaviour, will depend on cooperation based on
shared understanding. There is a strong connection between knowl-
edge possessed by the workforce and the services obtainable from its
material resources. (Laursen & Mahnke, 2001) The relationships

necessary to deliver complementarity will depend on effective infor-
mation flow between individual members of the workforce, between
business units and across the organisation. A critical area of leader-
ship and management competence therefore is that of collaborating
to create and share knowledge and information to expand the
potential for complementarity. Having insights about the potential
for complementarity will come to nothing if the leader or manager is
unable to seed other areas with the same knowledge. This is the
'know why' of leadership competence. But it is a shared know why.
9. Agile governance and cross organisation collaboration will facilitate
a further aspect of competence, and this is that leaders and manag-
ers are able to integrate multiple systems and processes and in so
doing will seek complementarities through synergies. Where
leaders and managers are able to use their resources in a complemen-
tary way ie across the organisation, then there is the possibility of
building system and business integration capabilities that can extract
high levels of complementary value. And indeed, as organisations
build alliances with both customers and suppliers over electronic
networks, the importance of integration and complementarity
potential becomes a critical issue. (Hsu, 2013) This is the know- how
of leadership and management as it pertains to complementarity.
10. In order to have an impact on organisational performance, people
management practices will need to be aligned to complementarity
initiatives. Leaders and managers will therefore need the important
area of competence which is the ‘know how to behave,’ or to engage
and develop the workforce to identify opportunities for comple-
mentarity within and without their own domains. The challenge
here is that engaging and developing the workforce is likely to be
context specific because employee engagement is a multi- faceted,
multi layered construct to which simplistic definitions are difficult to
attach and simple ‘solutions’ unlikely to be effective. (Turner, 2020)
Engagement is in part psychological; in part sociological; and in part
an outcome of organisational dynamics. It is influenced by supply
push and demand- pull factors; with ‘supply push’ having a positive
impact on an individual, the resources they have at their disposal and
248 P. Turner
the climate in which they work; and ‘demand pull’ interfering with
motivation and the smooth operation of work. It will be up to the
organisation, its leaders and managers to reframe engagement within
the context of meaning and purpose- specifically that of seeking
complementarity opportunities in systems and processes. (Shuck &
Rose, 2013; Turner, 2020) A culture of positive engagement, with a
workforce proactive in knowledge seeking and disseminating,
responsive to change and with the abilities to enact change effectively
is a priority.
11. The concept of ‘Triple A’ (agile, adaptable and aligned) in relation-
ship to the supply chain is one that resonates in other aspects of the
management of the organisation. In particular these will feature
heavily in the competences required by leaders and managers in
knowing when, knowing why and knowing how to pursue comple-
mentarity opportunities. Therefore, ‘understanding the interactions
between the system’s elements is essential to identify potential profit-
able changes,’ with particular relevance to complementarity. These
insights will inform investment and resource allocation decisions
(Feizabadi et al., 2021) and ultimately contribute to superior perfor-
mance. Since the successful implementation of strategy will
depend on its alignment with the organisation’s goals and objec-
tives it is important that leaders and managers know when to
seek and implement complementarities. The co-presence of align-
ment practices has been shown to be more valuable than the same
practices in isolation.
The potential for value creation through complementarity will be

enhanced by conscious strategy setting, decision making and resource
allocation and through the competences of leaders and managers contrib-
uting to a culture that recognises its benefits. This means a culture of
collaboration and cross domain cooperation through effective talent
management and employee or workforce engagement; where technologi-
cal advancement and a workforce performing creative tasks become com-
plementary in ‘complex, dynamic ways.’ (Pedota & Piscitella, 2021)
Talent management and workforce engagement have become key issues
in the dynamics of organisations, often dealt with at Board level
Complementarity, Talent and Engagement
People issues are business issues, and business progression will depend on
their effective management, contributing to high-performance work sys-
tems with positive outcomes such as productivity, innovation, and finan-
cial performance. In this scenario resource complementarities that will
arise when combining business unit– and individual-level interactions,
‘such that the aggregate knowledge and skills at the unit level fit well with
and supplement the particular knowledge and skills at the individual
level.’ (Burdin & Kato, 2021; Crocker & Eckardt, 2014) The benefits are
multi- faceted and multi-layered. In addition, a complementarity
approach will seek to use heterogeneity- human resource practices that
are difficult for competitors to imitate- to deliver performance over and
above that of competitors. The hypothesis is that the activities of talent
management, when combined with and complementary to the activities
of employee engagement, produce more than the sum of the benefits of
each when treated as singular events. From a resource- based view, com-
plementarity offers the opportunity to apply unique people management
practices and experiences to deliver performance over and above that of
competitors. There is support for the conclusion that the ‘relationship
between individual human capital and individual performance is
impacted by complementary functional and managerial unit-level human
capital resources.’ The benefits of people management initiatives may be
increased with a complementarity perspective across the whole organisa-
tion. (Crocker & Eckardt, 2014) Some introspection is required because
of the diversity of opinion about what constitutes talent and engagement.
In the case of the former, the term talent and the strategies associated
with it have evolved from ones of viewing this particular aspect of organ-
isational resource as the most senior people to a more inclusive one in
which all members of the workforce have talents to offer. A more plural-
istic perspective is increasingly used and talent management becomes
best fit rather than best practice. Likewise, workforce engagement is a
complex, multi- faceted concept that has evaded any attempts to pigeon-
hole it into a single discipline, having elements of psychology, sociology,
and workforce dynamics. However, a critical factor in achieving
250 P. Turner
complementarities is that the organisation decides on its definition of

both talent and engagement. In so doing it will facilitate the search for
complementarities between the two, and between the two and organisa-
tional performance. The key learning points in respect of this aspect of
complementarity are:
12. There is a symbiotic relationship between talent management and

workforce engagement. Whilst talent has become one of the key dif-
ferentiators for human resources management and for leveraging
competitive advantage, (Bhatnagar, 2008) employee or workforce
engagement is increasingly regarded as a strategic issue. Where there
is positive, proactive behaviour in the workplace and brought about
by a combination of motivated, emotionally attached employees the
potential benefits are significant. The assumption here is that work-
force engagement will improve if it is complemented by talent
management practice that addresses engagement issues; the per-
formance of talent management will be enhanced by talent
aligned engagement practices. However, the benefits of this rela-
tionship will only occur if there is clarity in the organisation about
the meaning of the two concepts in the specific context of that
organisation. And so, defining talent and talent management and
defining employee or workforce engagement will be necessary if the
right actions are to be taken and resource allocated to maximise the
advantages created.
13. Human capital resources may exist individually or within a collec-
tive- the aggregate of an organisation’s competences. (Ployhart &
Cragun, 2017) It is towards the latter that potential synergies occur
and as such, talent management and employee engagement become
mutually reinforcing. Having in place a coordinated approach to
both therefore provides a basis for progression at both strategic and
operational level. To do so will require identifying synergies
between talent management and workforce engagement and
developing strategy to realise the benefits of those synergies.
Since multiple types of human resource combination exist then it is
important to be aware of which are best fit to the organisation.
Subsequent actions will have a focus on providing positive outcomes
across the organisation.
14. How human capital resources are deployed and in what combina-
tions depend on strategic and operational decisions based on insights
into which combinations are likely to produce the best performance.
Amongst the factors are how talent management relates to a high-
performance organisational culture; or the impact of high levels of
employee engagement or a supportive change-, quality-, and
technology-driven culture, with ‘creativity, open communications,
effective knowledge management, and the core values of respect and
integrity.’ (Kontoghiorghes, 2016) The linkages between these
human resource practices and organisational performance is a strong
assumption. Identifying synergies between talent management,
workforce engagement and organisational performance is there-
fore the essence of complementarity as it relates to the broader pur-
pose of organisational progression. The synergies will be realised by
aligning talent and engagement strategies to organisational strategies.
15. Collings et al. (2018) identified a series of means through which
organisations ‘reconfigure intangible assets, such as human and social
capital, to respond creatively to the dynamic and unpredictable busi-
ness conditions that characterize the global business environment.’
Achieving high performance will therefore depend on the coherence
of a ‘broader ecology’ of complementarity- oriented routines. The
objective for ensuring operational alignment will be management
activity for talent and engagement informed by the complemen-
tarity principle. Hence leadership and management competence
should be aligned with achievement of complementarity objectives.
Talent management and workforce engagement will no longer be
purely functional or departmental activities but will instead be
directed towards overall organisational performance through com-
plementarity outcomes.
16. The Fourth Industrial Revolution will be people powered whereby
‘companies at the forefront of the technology frontier are empower-
ing their workers with digital technologies—and the skills they need
to use them.’ (McKinsey, 2022) An important aspect of complemen-
tarity, therefore, will be to show how this approach contributes to
performance outcomes. Hence measuring the return of investment
in complementarity; for 'business case' and resource allocation as
252 P. Turner
this applies to resources allocated to talent management and work-

force engagement, are important features. This means data, informa-
tion, intelligence and insight about how the organisation is
performing and the effectiveness of its complementarity aligned
people management.
The working hypothesis is that addressing complementarities between

talent management and workforce engagement will have benefits over
and above those that would accrue if the functions were treated in their
traditional independent ways. A number of factors, including changes in
employee perceptions about the nature of work and the associated expec-
tations, worldwide shortages in key skills, the transformation in the
workplace precipitated by the Fourth Industrial Revolution and of course
the impact of the pandemic- still being assessed- have created the oppor-
tunity for organisations to transform the way they work. This is also an
opportunity to pursue the benefits of a complementarity approach to
talent and workforce engagement.
Complementarity and Organisation
The strength of complementarity arises out of the potential to maximise

the benefits from interdependencies, linkages, and synergies. To do so
will require an interaction between strategy setting and resource alloca-
tion which will create mutually reinforcing systems producing superior
results over those that would occur if organisational actions had taken
place independently of one another. The hypothesis is that the relation-
ships between independent units, if directed appropriately will create
higher value than their individual operations with synergistic benefits
arising from unique and complementary resource combinations.
However, an influential factor in the realisation of such benefits will be
the effectiveness of cross-domain alignment, facilitated by a sympathetic
organisational structure. The emphasis here is on organisation and its
dynamics in facilitating complementarities-in-performance and comple-
mentarities-in-use. There are a number of key learning points in regard to
this aspect:
17. Complementarity not only relates to the tangibles of organisational

life such as technology but also intangibles including human
resources, knowledge, and culture, each of which is influenced by the
organisation’s design and its dynamics. In this respect, The perfor-
mance of the whole organisation will be improved when there is
complementarity between business strategy, leadership, manage-
ment, talent and engagement; where there is a culture of comple-
mentarity backed by organisation, systems and processes
designed specifically to recognise and address complementarity.
There is evidence in support of this proposition not only in achieving
economies of scale through cost- based synergies but in economies of
scope. For example, corporate performance was improved when the
organisation simultaneously exploited a complementary set of
knowledge related resources across its business units. In so doing
governance choices were instrumental based on the principle that
‘when the marginal returns to vertical integration for a given vertical
integration choice are increasing in the level of vertical integration
on related choices, there will be complementarity on governance
choices.’ In many cases the achievement of positive outcomes will
require a change in business model, and once again there is evidence
to support the conclusion that there was a positive complementary
effect on performance where this occurred. (Carree et al., 2011;
Cucculelli & Bettinelli, 2015; Novak & Stern, 2009; Tanriverdi &
Venkatraman, 2005) Insights into the impact of such choices will
determine whether complementarity benefits are achieved.
18. Grandori and Furnari (2009)raised an important question. ‘What is
the origin of the surplus value of the ‘joint application’ of two organ-
isational devices, i.e. where does complementarity come from?’ The
response will clearly determine how resources are allocated in its pur-
suit. Brynjolfsson and Milgrom (2013) noted that synergies occurred
when two or more agents interreacted such that that their combined
effect was greater than the sum of their individual effects. Such inter-
action was cooperation among groups. Complementarity was used
as a near synonym in their interpretation but was set in a decision-
making context. And it is the nature of these decisions that will
determine whether such complementarity strategies or initiatives
254 P. Turner
will succeed. Achieving positive outcomes will depend on the ability

to identify elements that provide opportunities for complemen-
tarity and provide tangible strategy, policy, and the formal rules
of organisation to their realisation. This will include sets or bundles
of internal resources or practices which work synergistically and from
this seeking insights from modelling 'clusters of interconnected
structures and practices'
19. There is no best practice organisation design and indeed the Fourth
Industrial Revolution has brought with it a whole new range of
organisational options stretching beyond the classic hierarchies or
matrices that arose in earlier times. Hence the choice facing most will
be based on a best fit approach. Nevertheless, and in the absence of
precedent, it will be important to model organisation configura-
tion taking a systemic and holistic view and seeking patterns or
profiles that can be related to superior performance outcomes.
Grandori and Furnari (2009) outlined a range of elements from
where such patterns may emerge. Amongst these were market ele-
ments, where different parts of a system are connected by value-
based exchange devices; bureaucratic elements represented by rules
or policies and their stewardship; and democratic elements: such as
employee voice or voting rights. Complementarity will be achieved
where these elements are set in an organisation design that facilitates
their interaction.
20. The adoption of complementarity initiatives and the creation of a
culture in which their benefits are embedded will not only be deter-
mined by traditional factors but also by the nature and structure of
the organisation. The final element to be considered in the quest for
complementarity in organisations is that of aligning and implement-
ing the strategy and plan using the transformed organisation design.
This means developing strategy for integrating resources to realise
synergies and aligning organisational structure to the new
requirements. There are theoretical underpinnings to the nature of
that structure. For example, in economics, there are ‘theories about
what assets and activities should be grouped together under common
ownership and unified governance go by the titles theory of the firm
or theories of vertical integration. All three branches of organisa-
tional economics— transaction cost economics, property rights the-

ory, and agency theory—have something to say on these issues.’
However, whilst the theories are broadly consistent, no single theory
integrates all three approaches. Hence it is likely that structure will
be context specific although a thread that runs through each is that
strong complements should be placed under unified governance.
(Baldwin, 2018) Organisational practices are determined by a variety
of factors of which organisation design in important. Having a struc-
ture that both reflects and facilitates the processes of complementar-
ity will therefore be a critical success factor.
Organisational design and development constitute a critical platform

on which to build complementarity initiatives. However, it is the area of
practice that organisational dynamics will either enhance or detract from
initiatives towards complementarity. This applies at unit or departmental
level where not only leaders and managers will be expected to seek syner-
gies beyond their own immediate spheres of influence but also members
of the workforce. It also applies at organisation level where cross unit or
function synergies are possible if the structure and culture allow their
identification and pursuit. Organisational dynamics can accentuate the
possibilities of complementarity. They can also thwart its realisation.
Conclusion
As business organisations strive for progression, they will seek ways to
ensure that the strategies they craft and the way in which they allocate
resources are consistent with their overall vision of where the organisation
should be and the objectives to ensure it gets there. And, having done so,
to ensure that the strategy is sustainable adding value to both short- and
longer- term investments whilst at the same time respecting social objec-
tives such as fair- trade practices or respect for the environment, diversity,
and equality of opportunity. In a modern context, business progression
increasingly means achieving economic growth whilst having a positive
effect on society as a whole. There are numerous philosophies and theo-
ries about how to do so. Strategic models abound, definitions of the
256 P. Turner
competences required by leaders and managers, how to manage talent or

create an environment for workforce engagement and alternatives on the
design of organisations have evolved over the Four Industrial Revolutions
that have taken place over the past 250 years or so. There is no shortage
of advice about best practice in each of these areas. However, an organisa-
tion’s leaders will make decisions less on best practice, more on best fit,
taking account of both the external context and internal capability.
The same principle might be applied to an additional strategic and
operational alternative that is available to organisations. This is the con-
cept of complementarity in which one capability reinforces the impact of
another capability. This concept has also evolved over time and has been
applied at the abstract level in philosophy as well as in practical issues
relating to economics, technology, or human resource management.
Complementarity is the antithesis of singularity. For the purposes of this
book, it is argued that strategy, leadership, management, talent, and
engagement, can have complementary properties which, if directed, will
have a greater impact than if they were regarded as independent activities.
Put simply, it means maximising valuable, unique synergies from the
integration of complementary resources. Complementarity is based on
the principle that the outcomes of singular initiatives will be improved
where they take account of the potential synergistic opportunity with
other initiatives. It brings together the properties of activities into a com-
plementary framework in the context of the totality of the phenomena.
The realisation of complementarities will occur where there is a strat-
egy in place that identifies their potential and allocates resource to their
delivery; where leaders and managers have a holistic view of the organisa-
tion and a competence in agile governance that allows them to propose
initiatives both within and beyond their immediate areas of responsibil-
ity; a workforce that has capabilities within a specific area but an aware-
ness of wider applications and opportunities and an organisation design
that facilitates and encourages the identification of complementarity
opportunities. None of these requirements are likely to occur automati-
cally. And so success will come from a deliberate and transparent intent
to maximise opportunity that may lead to unique advantage.
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Index
A complementary, 2, 66, 67, 69, 79,

Agile governance, 38, 43–45, 48, 95, 87, 109, 174, 178, 225, 243
125, 175, 177, 194, 204, 207, intangible, 2, 15, 20, 74, 154,
211–213, 215, 217, 218, 225, 182, 207, 223, 242, 251
226, 242, 246, 247, 256 orchestration, 99, 104, 105, 109,
Agility, 3, 5, 6, 14, 23, 38, 44, 47, 234, 243, 244
48, 50–52, 91, 95, 103, 116, tangible, 2, 15, 20, 74, 76, 203,
125, 131, 133, 135, 177–179, 207, 242
182, 192, 211, 225, 234, Attitudes, 12, 24, 45–46, 50, 95,
244, 246 122, 166, 203–226, 245
Airbnb, 70, 240
Alibaba, 18
Alignment, 3, 49, 51, 71, 72, 75, 87, B
96–99, 105, 108, 116, 125, Balanced Scorecard, 4, 89
127, 128, 133, 156, 159, 164, Behaviours, 2, 8, 12, 14, 19, 24, 25,
165, 174, 190–192, 211, 220, 45–46, 50, 62, 68, 95, 104,
244, 245, 248, 251, 252 105, 118, 122, 127, 131–134,
Amazon, 2, 18, 70, 88, 92, 239 149, 152, 156, 176, 191, 193,
Ansoff, 4, 89 194, 203–226, 235, 245,
Assets 246, 250
https://doi.org/10.1007/978-3-031-10654-5
262 Index
Big Data, 34, 101, 204 166, 191, 194, 203, 207, 215,
Blockchain, 35 224, 238–240, 242–244, 250
Bohr, Nils, 25, 60, 61, 99, 235 Competitive progression, 1–4, 70,
BP, 18 93–95, 98, 101, 105, 133,
134, 162, 179, 217, 240
Complementarity
C assets, 67, 100, 101, 187
Career, 119, 146, 147, 152, 154, business strategy, 3, 15, 21,
155, 158, 159, 164, 165 59–60, 71, 76, 77, 87–109,
China, 17 115–116, 162, 243–245, 253
Cloud Technology, 34 competence, 48–51, 94, 122,
Coca Cola, 17 203–226, 245
Coherence, 3, 19, 22, 87–89, 96, innovation, 67, 72, 109
101, 109, 116, 131, 145, 160, leadership and management, 23,
234, 251 115–136, 164, 218, 245–248
Collaboration, 24, 34, 37, 38, 41, organisation, 106, 204
50, 51, 71, 72, 96, 100, 105, origins, 59–79
125, 126, 130, 131, 134, 135, production, 64, 67, 73, 182,
148, 151, 165, 177, 179, 187, 183, 236
189, 203, 204, 211–216, 226, qualitative, 64, 237
247, 248 quantitative, 64, 237
Collaborative, 25, 40, 44, 71, 97, and singularity, 1–25, 42, 75,
101, 115, 122, 123, 130–131, 243, 244, 256
181, 193, 211 talent and workforce engagement,
Competence 143–167, 252
leadership, 21, 77, 164, 246, 247 Congruence, 3, 19, 41, 75, 87–89,
management, 15, 21, 24, 38, 92, 96, 101, 109, 116, 131,
43–45, 47, 77, 105, 124, 160, 234
128, 129, 149, 164, 203, Consistency, 3, 8, 19, 61, 87–91, 96,
205, 206, 218–224, 226, 101, 109, 116, 131, 160, 176,
245–247, 251 194, 234
organisational, 24, 203–218, 226 Corporate
Competitive advantage, 1–6, 12, 15, governance, 156
19, 20, 23, 24, 34, 37, 39, 49, strategy, 97, 157
50, 52, 66–68, 70, 74, 78, 89, Cost reduction, 3, 20, 68, 76, 88,
90, 92, 98, 99, 104, 108, 109, 132, 234, 238, 241
116, 117, 126, 146, 152, 157, Cross boundary working, 125
Index 263
Culture, 19, 21, 24, 38, 42–44, 50, Economy

77, 90, 94, 96, 103, 104, 115, circular, 63
120, 127, 128, 133, 135, 147, development, 63
150, 152, 156, 162, 173, 178, macro, 17, 63, 235
180, 181, 183–185, 189, 190, Einstein, Albert, 60
203, 204, 206, 207, 214–216, Emotional intelligence, 7, 118, 150,
218, 224–226, 234, 242–244, 205, 218
248, 251, 253–255 Employee engagement, 11, 12, 15,
Customer, 11, 34, 35, 37, 40, 49, 23, 24, 143, 144, 147,
65, 66, 70, 72, 75, 77, 88, 90, 149–154, 157, 161, 162,
92, 95, 107, 108, 126, 129, 164, 175, 217,
131, 145, 150, 158, 159, 179, 247, 249–251
180, 182–184, 186, 187, 189, Environment, 1, 3, 4, 6, 9, 13–16,
204, 206, 207, 222, 223, 32, 36–52, 64–75, 78, 87–89,
237–239, 247 91, 92, 94, 101, 105, 116,
Customer satisfaction, 3, 12, 20, 76, 117, 119, 121, 127, 134, 145,
88, 159, 217, 234, 241 146, 149, 150, 153–158, 165,
Cyber-physical, 34, 46 166, 174, 175, 177, 178, 181,
188, 189, 191–194, 203, 204,
206, 207, 211–214, 218, 219,
D 224, 234, 236, 240, 242, 251,
Diversity, 1, 23, 42, 117, 121, 166, 255, 256
204, 249, 255 ERP, 73
Division of labour, 8, 104, 119, 192,
215, 233
Drucker, Peter, 9, 17, 119, 121 F
Facebook, 18, 70, 240
Fair-trade, 1, 117, 204, 255
E Finance, 21, 39, 47, 115, 126, 155,
eBay, 70, 240 182, 243
e-business, 70, 73, 131, 181, Ford, Henry, 13, 119, 120
183, 238 Fourth Industrial Revolution, 2, 3, 6,
e-commerce, 36, 70, 132, 238 21, 23, 25, 31–52, 63, 70, 78,
Economics, 1–4, 6, 9, 10, 17, 25, 91, 101, 103, 122, 129, 148,
31, 49, 51, 60, 62–66, 69, 73, 152, 166, 173, 181, 192, 194,
93, 98, 117, 120, 155, 177, 211, 213, 218, 234, 238–242,
187, 234–236, 244, 254–256 251, 252, 254
Economic theory, 59, 237, 241 France, 174
264 Index
G Industry 4.0., 10, 13, 18, 21, 23, 25,

Gallup, 158, 163 34, 36, 37, 40, 41, 46, 49, 50,
Gap analysis, 4, 89 74, 78, 152, 218
General Electric, 17, 181 Information, 33–36, 40, 41, 44, 45,
Gillette, 17 50, 51, 61, 69, 89, 105–108,
Google, 70, 240 122, 123, 126, 129, 131, 152,
Governance, 32, 33, 37, 38, 166, 174, 183, 185, 186,
43–45, 48, 52, 64, 78, 95, 188–190, 192, 193, 203, 205,
125, 156, 175, 177, 194, 206, 221, 224, 245, 247, 252
204, 207, 211–213, 215, Information technology (IT), 19,
217, 218, 225, 226, 242, 34, 68, 70, 71, 97, 107, 115,
246, 247, 253–256 119, 129, 131, 174, 181,
187, 238
Innovation, 7, 9–12, 19, 24, 31, 32,
H 35, 37, 38, 42, 43, 46, 47,
Hierarchy, 8, 13–15, 41–43, 47, 49–51, 64, 66–73, 78, 97,
104, 119, 175–178, 187, 189, 100–104, 106, 108, 109, 118,
192, 193, 216, 217, 233, 254 120, 129, 132, 144, 150, 155,
Holistic, 2, 12, 14, 24, 38, 41, 157, 159, 160, 174, 177, 181,
46–48, 75, 76, 92, 102, 126, 183–185, 188, 203–207,
130, 175, 187, 219, 240, 213–215, 221, 224, 233, 234,
254, 256 237, 238, 249
Honda, Soichiro, 17, 120 Integration
HRM, 144, 146, 152, 163, 216 horizontal, 41, 240
Human multiple systems, 129–130, 222,
capital, 31, 70, 97, 98, 143, 145, 223, 247
146, 155–157, 159, 162, vertical, 41, 253, 254
163, 249–251 Intelligence, artificial, 25, 32,
resources, 2, 36, 43, 66, 76, 89, 33, 35
103, 107, 129, 146, 153, 155, Internet of Things (IOT), 25, 32,
157, 158, 165, 183, 204, 206, 34, 51, 63
216, 217, 243, 250, 253 IT, see Information technology
I J
IBM, 17 Japan, 13, 17, 74, 120
India, 17 Jobs-Demand-Resources, 150
Index 265
K 77, 79, 92, 105, 115–136,

Know how, 15, 43, 87, 122, 123, 147, 156, 164, 175, 183, 184,
125, 127–130, 205, 206, 222, 203–206, 208–210, 216,
223, 243, 246, 247 218–224, 226, 233, 240, 242,
Know how to behave, 43, 122, 123, 244–248, 251, 253, 256
127–128, 205, 246, 247 Lloyds, 18
Knowledge
creation, 100, 105, 152, 157,
160, 178, 179, 183, 192, 216, M
224, 246 Ma, Jack, 120
dissemination, 24, 100, 134, 152, Management, 2, 7–10, 31, 43–45,
159, 160, 173, 178, 183, 194, 48–51, 65, 88, 115–136, 143,
224, 246 151–166, 174, 203, 218–224,
exchange, 98, 152, 204, 246 233, 245–248
management, 126, 133, 155, 159, scientific, 9, 13, 16, 119, 176
179, 183, 185, 204, 251 Marketing, 2, 14, 21, 32, 38, 39,
sharing, 78, 105, 125, 130, 41, 47, 67, 72, 73, 76,
134, 151 77, 89, 95, 107, 131, 155,
Know what, 2, 122, 123, 185, 205, 173, 174, 182, 183, 193, 206,
215, 219, 246 213, 243
Know when, 122, 123, 205, Market share, 3, 18, 20, 76, 88, 89,
246, 248 115, 145, 234, 241, 243
Know why, 122, 123, 126, 205, 222, Matsushita, 17
246, 247 Measurement, 93, 106, 165, 221
Measures, 15, 39, 63, 106–108, 160,
244, 245
L Measuring, 106–108, 165, 188,
Leader, 2, 6–10, 15–19, 21, 24, 32, 244, 251
37, 43, 44, 48, 49, 52, 77–79, Metrics, 35, 106, 159, 166
91, 94, 96, 101, 103, 104, Mintzberg, Henry, 5, 9, 10, 17, 91,
115–118, 120–135, 148, 151, 116, 120–122
156, 158, 164, 165, 178, 183, Mission, 3, 87, 109, 116, 136, 156,
188, 190–192, 204, 205, 212, 183, 233, 243
218, 219, 221, 222, 224, 226, organisation, 87, 233, 243
234, 243, 245–248, 255, 256 Mitsubishi, 17
Leadership, 3, 5–11, 15, 20, 21, Mitsui, 17
23–25, 31, 32, 43–45, 47, 74, Mittal, Lakshmi, 17, 120
266 Index
N P
Netflix, 70, 240 People management, 10, 94, 144,
148, 151, 166, 247, 249
Pepsico, 17
O Performance, 2, 35, 66, 74–78, 88,
Objectives, 1, 3, 5, 7, 10, 14, 18, 19, 115, 144, 156–159, 173,
24, 32, 43, 47, 50–52, 76, 77, 204, 234
87–90, 94, 96, 98, 100, 103, Performance measures, 234
105–107, 115, 117, 122, PESTLE, 4, 89
125–130, 133, 135, 143, Porter, Michael, 4, 5, 17, 19, 39
145, 147, 148, 154, 155, Processes, 2, 32, 71, 87, 101–103,
158, 159, 161, 163–166, 116, 143, 173, 204
173–179, 183, 186, 190, 193, Productivity, 2, 10, 12, 32,
204, 205, 207, 213, 218–222, 35, 37, 40, 63, 64, 73,
233, 234, 240, 243–246, 248, 97, 103, 106, 119, 144, 149,
251, 255 152, 154, 156–160, 174, 176,
Organisation 179, 183, 187, 214, 216,
bureaucracy, 102 237, 249
design, 13–15, 24, 41, 66, Profit, 1, 3, 11, 12, 15, 20, 40, 64,
76, 77, 79, 94, 96, 121, 67, 73, 76, 88, 117, 150, 204,
134, 135, 162, 173, 174, 178, 205, 234, 237, 241
180, 182, 186, 188–190, 193, Progression, 1–4, 13–20, 22,
194, 233, 239, 242, 37–41, 45–46, 48–51, 65, 70,
243, 253–256 74–76, 79, 87, 91–95, 98,
dynamics, 3, 36, 49, 50, 96, 100, 101, 105, 115–123, 128,
135, 145, 146, 148, 150, 161, 129, 133–135, 162, 163, 173,
178, 194, 206, 212, 219, 240, 179, 203, 204, 206, 207, 213,
242, 243, 247, 248, 252, 215, 217, 218, 224, 225,
253, 255 233–235, 240, 242, 245,
structure, 15, 20, 41, 42, 49, 249–251, 255
50, 52, 75–79, 94, 95, 99, Psychology, 61, 147, 148, 150, 151,
101, 121, 123, 131, 134, 161, 249
150, 162, 167, 176, 177,
181, 182, 184, 186,
188–190, 192, 194, 207, Q
211, 225, 234, 239, 252, Quantum physics, 23, 59–60, 235,
254, 255 236, 241
Index 267
R Sociology, 12, 147, 148, 150, 151,

Research and development (R and 161, 249
D), 17, 69, 73, 74, 183 Sony, 17
Resource allocation, 19, 52, 91, SpaceX, 18
99, 104, 109, 115, 131, Spain, 174
162, 165, 173–176, 203, 204, Spotify, 70, 240
216, 217, 234, 246, 248, Strategy
251, 252 business, 3–7, 15, 16, 20–22, 31,
Resources, 1, 35, 63, 88, 115, 37, 39, 40, 47, 48, 59–60, 71,
131–132, 144, 165, 173–175, 76, 77, 79, 87–109, 115–116,
181–188, 203, 233 128, 151, 157, 162, 165, 174,
valuable, unique, or 220, 225, 234, 241,
inimitable, 67, 242 243–245, 253
Return on investment, 1, 18, 93, coherence, congruence, and
107, 108, 117, 154, 204, 245 consistency, 19, 87–89, 101,
Robots, 15, 35, 46, 101 109, 131, 160, 234
corporate, 88, 157
functional, 39, 92, 94, 96–99,
S 193, 244
Samsung, 18 policy and stewardship, 3, 7,
Shareholder value, 1, 3, 5, 18, 20, 40, 94, 192, 225,
76, 88, 90, 117, 160, 166, 233, 242
204, 234, 241, 243 Sumitomo, 17
Skills, 8, 13, 16, 24, 32, 37, 38, 40, Supply chain, 2, 14, 32, 35, 72, 73,
43, 45–47, 52, 69, 94, 95, 97, 126, 212, 240, 248
99, 122, 123, 135, 145, SWOT, 4, 89
149–152, 154, 155, 165, 166, Synergy, synergies, 2, 20, 21, 41,
173, 174, 178, 183–185, 46–50, 67, 70, 72, 73, 75, 89,
203–226, 234, 245, 249, 91–95, 97, 100, 107, 108,
251, 252 128–130, 132, 133, 143, 153,
Smart factories, 32, 35 155, 159, 161–163, 166, 174,
Smart workplaces, 13, 35 179, 181, 182, 187, 188, 190,
Smith, Adam, 8, 119 194, 205, 206, 215, 222, 234,
Social complexity, 90, 103–106, 130, 236, 239, 241, 242,
133–134, 154, 183, 215, 217, 247, 250–256
224, 244 Systems, 3, 13–15, 32, 67, 87, 119,
Social welfare, 1, 117, 204 132–133, 143, 174, 204
268 Index
T Vision, organisation, 116, 136, 159,

Talent 165, 233, 243
definition, 6 VRIO, 207
exclusive, 10–13, 144, 146, VUCA, 44, 47, 90, 91
147, 157
inclusive, 10–14, 144, 146–148,
151, 154, 157, 161, 163 W
War for, 10, 11 Walt Disney, 17, 182
Technology, 3, 31, 34–36, 63, 87, Weber, Max, 17, 176, 177
116, 148, 173, 203, 234 Wholeness, 47, 60, 62, 76, 236
Tesla, 18 Workforce, 3, 6–8, 10, 13–15, 18,
Toyota, 2, 17, 120 38, 40, 43–46, 48–50, 69, 79,
Triple A, 248 94, 103, 105, 122, 127–128,
Turnover, 11, 12, 68, 132, 158, 238 134, 135, 143, 147–151,
154–157, 159, 161, 163, 164,
166, 173, 183, 185, 188, 191,
U 204, 224, 234, 243, 246–249,
Uber, 70, 240 255, 256
UK, 11 Workforce dynamics, 249
Unilever, 18 Workforce engagement, 6, 10, 11,
USA, 12, 17, 68, 73, 174, 176, 181 13, 21, 23, 24, 47, 77,
143–167, 178, 183, 224, 233,
248–252, 256
V World Economic Forum (WEF), 15,
Values, 1, 31, 62, 87, 116, 143, 38, 45, 46, 48, 211
173, 204
shareholder, 1, 3, 5, 18, 20, 76,
88, 90, 117, 160, 166, 204, Z
234, 241, 243 Zhang Ruimin, 17, 120

Complementarity in Organizations

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1 From Singularity to Complementarity 1

2 The Fourth Industrial Revolution 31

3 The Origins of Complementarity 59

4 Complementarity and Business Strategy 87

5 Complementarity in Leadership and Management115

6 Complementarity in Talent and Workforce Engagement143

8 Complementarity and Competence-­knowledge, Skills,

Paul Turner has held Professorial appointments at Universities in Leeds,

Fig. 1.1 Business progression—complementarity, strategy and devel-

 ompetitive Progression—Achieving Economic

© The Author(s), under exclusive license to Springer Nature Switzerland AG 2022 1

There is a panoply of strategic thought as to how organisations can

advantage—to craft how they go about leveraging any potential comple-

Complementarity is the interaction of business strategies and manage-

How to apply this interpretation will depend on those responsible

(Rumelt, 2011; Schoenwaelder, 2019; Lanteri, 2021) An understanding

 usiness Strategy—More than a Reflexive,

given its focus on the exploitation of internal resources in the achieve-

organisation, the agency of strategy, stewardship, and policy provide the

Leadership and Management—Influencing

integrity, trust and delegation, honesty, and consistency. Or leadership

seeds of Scientific Management were sown and cultivated. However, an

management were wrong because ‘managing is controlling and doing and

F rom Exclusive to Inclusive—Defining Talent

roles of global specialists (such as project managers who were able to

non-engaged co-workers. The US based Society for Human Resource

A compelling conclusion about both talent and workforce engagement

In all cases organisations are both collections of individuals and politi-

‘Significant complementarities in a rapidly changing environment pro-

 ources of Progression over Four

by effective strategy resepct for diversity

through cost identify and build

with agile governance synergies through

Fig. 1.1 Business progression—complementarity, strategy and development

These models have increased in their incidence and sophistication, in

carrying out their roles. Informed and influential business leaders or

prowess and effective management aligned to international trade and glo-

industrial and commercial ventures reflected a willingness to learn and to

 omplementarity is the Antithesis

• The performance of the whole organisation will be improved when

Fig. 1.2 Complementarity—at the core and at the periphery

A confluence of technologies will transform every aspect of how organ-

The Structure of the Book

more detail at the characteristics and nature of the Fourth Industrial

Collings, D. G., & Mellahi, K. (2013). Commentary on: “Talent—innate or

Hsu, P. F. (2013). Integrating ERP and e-business: Resource complementarity in

Turner, P. A. (2021). The making of the modern manager. Palgrave Macmillan.

F ourth Industrial Revolution—‘Unlike

© The Author(s), under exclusive license to Springer Nature Switzerland AG 2022 31

Excellence was achieved by focus- on such strategic options as cost

grow, with the confluence of technologies forecast to reach its apogee in

• Transformation of the frameworks of production, management, and governance

• Progression multifaceted and connected

Fig. 2.1 The Fourth Industrial Revolution—characteristics, impact and response

Markey, 2020; Peccarelli, 2020) These developments will benefit organ-

 Confluence of Technologies and Their

Artificial Intelligence that ‘thinks’ in a rational way—includes machine

New technologies will be ubiquitous; they will converge in unprece-

F ourth Industrial Revolution—Strategic

deal with inherent strategic discontinuity forcing them to rethink their

though, systems will need to be integrated, enterprise wide, virtually, and

1 From Singularity to Complementarity 1

2 The Fourth Industrial Revolution 31

3 The Origins of Complementarity 59

4 Complementarity and Business Strategy 87

5 Complementarity in Leadership and Management115

6 Complementarity in Talent and Workforce Engagement143

8 Complementarity and Competence-knowledge, Skills,

ompetitive Progression—Achieving Economic

usiness Strategy—More than a Reflexive,

Leadership and Management—Influencing

F rom Exclusive to Inclusive—Defining Talent

ources of Progression over Four

omplementarity is the Antithesis

The Structure of the Book

F ourth Industrial Revolution—‘Unlike

Confluence of Technologies and Their

F ourth Industrial Revolution—Strategic

omplementarity—From Quantum Physics

Complementarity—A Scientific Foundation

Complementarity in the Business

Complementarity in the Business

Complementarity and Organisational

Coherence, Congruence and Consistency

The Evolution of Business Strategy Concepts

usiness Progression and Cross