In his introduction to the 10th Global Peter Drucker Forum, focussing on the human dimension of management, Richard Straub asks “What place do we give the human in organisations?” and, leaning on Aristotle’s phronesis, argues that “reasserting the human dimension means above all asking the why questions that enable us to ponder deeply who we are, what we do and where we should be going”. He concludes with a strong call to action: “Bearing direct responsibility for confronting these issues in the workplace, management can light the fire – and must do it now, before it is too late.”
I have no doubt that the Forum, which again brings together the brightest minds in business in an unmatched lineup of speakers, will give us plenty of worthwhile questions. And more.
We will hear appeals to rediscover our humanity, to create more than shareholder value and turn business into the force for good it could be.
We will have speakers present us with brilliant analyses of how AI, robotics, digital and other technological developments are changing the nature of work. And why, despite the threats posed to our jobs, technology comes with the inherent potential to liberate us from repetitive activities – allowing us to focus on what makes us uniquely human.
We will discuss inspiring examples of how human-centric innovation can create growth and wealth for all of us. We will convince ourselves that a better world is indeed possible.
How to make it happen
But will we talk nearly as much about how to make it happen? Or will we get so excited with the what and the why that we end up neglecting the how?
Are our current organisations capable of turning these hopes and dreams into reality? If they are, why haven’t they been able to solve longstanding simpler problems?
According to Gallup, only 15% of employees worldwide are engaged in their job. We have poured hundreds of millions of dollars into “engagement programs” for years – with zero effect.
Similarly, according to the Deloitte Center for the Edge’s shift index, return on assets (RoA) as a measure of performance of US public companies has been on a steady decline since 1965, to a quarter of what it was in the sixties.
Equally depressing evidence exists for our organisation’s continued inability to innovate, to change or to earn public trust.
If we can’t fix these, how can we get our organisations to “reassert the human dimension” and create a better world for us all?
In his closing address at last year’s Drucker Forum, Charles Handy observed: “We need to rethink how organisations, particularly businesses, are run, why they are run, and what their purpose and role are in society.”
He has got the order exactly right. Before we can expect our organisations to produce different outcomes, we need to rethink how they are run.
That means management. What Peter Drucker described as the “life-giving element in every business”. And what Gary Hamel so beautifully calls “the technology of human accomplishment”.
Pillars of management
Management needs to stand firm on all three pillars: what, why and how. If it doesn’t, it fails to live up to its purpose. How we practice management makes all the difference.
Yet when I ask managers to explain their organisation’s management model, more than 80% cannot describe it.
Management has one job: to make an organisation function. The management model describes how management achieves that, like a business model describes how a business creates value for customers profitablty.
The management model clarifies which systems, tools and practices we are using to get the job done. It also clarifies why we made these choices: what are the underlying theories and beliefs that we rely on? Are these good theories? Do they apply in our context?
What does it mean if more than 80% of managers cannot answer these questions about their own organisations?
Foremost it means that we are unable to purposefully change the way our organisations work. How do you improve something that’s not explicit?
Failure to solve big problems
I believe this largely explains why we haven’t been able to solve the problems of engagement, innovation or performance. Neither will we be able to address the next set of challenges as we explore the human dimension of management.
Unless we first talk about management itself. How we practice it and how we anchor that practice in the body of solid management theory. We know how to make people thrive at work, we know how to innovate and we know how to create high performance organisations.
But we have failed to reflect that in managerial practice. We have failed to design management models that produce different results.
Remembering the 500 year anniversary of the Protestant Reformation, Charles Handy ended with a call for a business reformation. He asked if the Drucker Forum could not be the new Wittenberg and Peter Drucker (with all of us magnifying his voice) the new Martin Luther.
I believe it can. The reformation is analogy is a perfect one. The Reformers, led by Martin Luther, did not invent a new religion. They went back to basics, re-discovered and brought to light the truth that the Christian Church possessed and had relied on for centuries. At the heart of that re-discovery was a how question: how can man be reconciled with God?
Likewise, for our successful business reformation, we not only need to ask the most important how questions but also remember that we already know the answers to many of them. Answers that Peter Drucker and many other great management thinkers, have already given us.
These answers might not be quick fixes, or popular. There may be a cost. But they represent truth on which to build better organisations.
In Vienna, let’s not be satisfied with inspiring visions of what might be. Let us be relentless in asking how. Let us aim improve the practice of management first.
About the author:
Raymond Hofmann is an associate of the Peter Drucker Society Europe and an independent management consultant. His latest project, management model design, aims to help improve the practice of management by a) creating a common language to describe, challenge and improve management models and b) making good management theory more easily accessible.
This article first appeared on Linkedin Pulse.