If the 20th was the management century and the 21st the century of leadership, as GDPF2020 proposes, what does that mean for management development and education? What are the challenges, and how can they be met? This was the subject of a two-part pre-conference panel workshop under the title
Preparing Leaders for Tomorrow: Revisiting Drucker’s lost art of management,
led by Ulrich Hommel, Director of Business School Development at EFMD GN and Professor of Corporate and Higher Education Finance at EBS Business School.
The challenges to leaders are indeed formidable, not least the emergence of inter-institutional ecosystems involving complex feedback mechanisms which make outcomes for participants difficult to predict and harder to manage. An important part of the issue, said Hommel, is being able to lead in a VUCA world – being confident enough to make sense of events and trends, to embrace change and to act even knowing that sometimes you will be wrong. In this world, old certainties – indeed the idea of certainty itself – are suspect. Far from being the answer, technology, with its emphasis on analytics and hard sciences, has lured managers away from Drucker’s vision of management as a humanities-based liberal art. There is now a widespread feeling that as a result management has lost its way, being indirectly or indirectly implicated in some of the most urgent problems the world faces – climate change, inequality, political instability – which can’t be solved without business involvement, but not by merely applying traditional management paradigms . In short, management is guilty of committing the cardinal Drucker sin of doing things right that shouldn’t be done at all – which is squarely a failure of leadership.
Drucker Forum 2020
The collapse of previous leadership certainties is clearly demonstrated by the fate of the post-Jack-Welch generation at the famous leadership academy that was GE. As INSEAD’s Yves Doz pointed out, neither of the two unsuccessful candidates for Jack Welch’s job was a success elsewhere. By imposing the GE playbook on it, Jim McNerney ‘nearly killed’ 3M. The tenure of Robert Nardelli at Home Depot was similarly undistinguished. As for GE, the conglomerate last year did the unthinkable by appointing its first leader from outside the company. The common error, said Doz, was an ‘over-structured’ approach to leadership, over-reliant on GE’s well-grooved processes and systems. In today’s unpredictable conditions, leaders at incumbent companies tend to be too linear, even over-rational. ‘We have to resist the urge and instinct to plan. Sometimes the right answers are questions’, said Doz. Yet the opposite totally unstructured approach, as demonstrated by leaders at fast-growing Nokia, is not a recipe for success either. Constantly surprised by their own success, Nokia managers had no playbook at all, simply replicating what had worked before, until it didn’t. Leaders have to find their own way between the two extremes.
How to do so depends on circumstances: leadership is to a large degree situational. For Laurent Choain, Chief People Officer of professional services group Mazars, leaders are not born nor made so much as revealed by opportunity. General de Gaulle would have remained a not-very-successful army officer if his path hadn’t crossed that of Hitler, Choain pointed out. The corollary is that there is an unknown quantity of good leaders out there who only lack the situation that would allow, or force, them to prove it. Conversely, there is no one size that fits all circumstances. At Mazars, following the departure of an exceptionally powerful leader, Choain decided it was impossible for a single person to fill the shoes of the outgoing CEO and appointed a leadership group of senior partners, which is how the company is run today.
But there is a problem here. If leadership can’t be reduced to a set of standard strategies or personal characteristics, and only emerges from context, how can it be systematically prepared for? For business schools, which are first in line, this is both an obvious problem and an opportunity. The current model of ‘rationing’ leadership development through cost and strong selection is at odds with the demand for more and better leaders (let alone ‘leadership everywhere’, the theme of GPDF20), and plays into the old-fashioned vision of the leader as a lone hero. Moreover, led by fashionable fintech, AI and big data analytics, business schools may be becoming narrower in focus and more, not less technology oriented. So, are they needed at all? ‘Blow them up,’ suggested Bernhard Kerres, a rare combination of opera singer, Silicon Valley entrepreneur and consultant. Leaders would be better off parking the idea of doing an MBA and spending the money on a start-up, he argued. Forget about leaders, Kerres continued, what is needed now are ‘nodes’ – people embedded in multifaceted networks, like players in a string quartet or jazz combo rather than the conductor standing in front of an orchestra.
Others differed. Accepting the need for better delivery at scale, the real challenge, said Martin Boehm, Dean of IE Business School, is making business education more purposeful and better linked to professional needs. Leaders needed to ‘speak tech’ too, but more important shall be the development of cognitive skills enabling graduates to deal with complex problems, ambiguity, and managing collaboration and creativity – things beyond the reach of AI. For Hommel, the future lies in learning ecosystems of which business schools would be only a part; their leaders would have to model the qualities that other organisational leaders would also need, such as sense-making and the ability to interpret the future on the basis of weak signals. Ivo Matser, president of GISMA Business School, proposed that, in 10 years’ time, business schools should be offering a unique personalised learning journey for each student. The second part of the leadership supply chain, opportunity, was less discussed. Some of it could be dealt with in the evolving learning ecosystem; companies also have a role to play. The subject could usefully be addressed in the 2020 Drucker Forum.
Ultimately, however, the discussion circled back to Drucker’s foundational distinction between leadership and management. As both Julia Wang, president of the Peter F. Drucker Academy, and executive coach and creative thinker Michael Gelb insisted, whatever the circumstances, leadership in the sense of doing the right thing can only be grounded in individual balance and character. This requires in the first place managing yourself – understanding your strengths and building on them, recognising weaknesses and remedying bad habits – and secondly, articulating the end to which leadership is the means. That has to go beyond the purely commercial: ‘what you want to be remembered for, what you want to become’, in Wang’s words; ‘taking the lead in solving the world’s problems’, in Gelb’s. Those ends can’t be outsourced. They can only be located in human judgement in the light of the well-being of the social ecology as a whole – reasserting and revitalising Peter Drucker’s lost art.
About the Author:
Simon Caulkin is a UK business journalist and writer.
This article is one in the Drucker Forum “shape the debate” series relating to the 11th Global Peter Drucker Forum, under the theme “The Power of Ecosystems”, taking place on November 21-22, 2019 in Vienna, Austria #GPDF19 #ecosystems