“The end of certainty means the possibility of novelty, of evolution.”
Ilya Prigogine

A critical function of leadership is to ask questions and not settle for answers. This protects uncertainty as a space for curiosity and imagination. When there are too many answers provided and too few questions asked, things stagnate and the atmosphere stifles. Protecting uncertainty is akin to keeping a window open for light and fresh air, maintaining a sense of opportunity and the ambiguity that keeps the spirit of humanity as a search for meaning.

We believe leaders inspiring others to superior performance works best when people pursue opportunities to innovate as a natural part of their daily work, when openness and playfulness become as valued as structure and reason. Yet we have found leaders struggle mightily with this simple premise. They have traditionally seen their role as shutting the window and eliminating all the mistakes. Here´s why!

Drucker Forum 2020

This article is one in the “shape the debate” series relating to the fully digital 12th Global Peter Drucker Forum, under the theme “Leadership Everywhere” on October 28, 29 & 30, 2020.
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The Baggage of Uncertainty

There is a core idea that aggregated things have lower variability than individual components. For example, while individual air molecules behave chaotically, the air in a room can have a stable, ambient temperature as it takes on the aggregate behaviour of all molecules.

The notion of aggregation is central to insurance where the pooling of individual risks creates a more stable aggregate that can be priced. The same idea operates in financial markets where securitization pools debt obligations to create a synthetic reconfiguration into tranches sold to investors with different risk appetites.

In the same way, every innovation project has a large degree of uncertainty that cannot be eliminated: we cannot know all the outcomes of our actions, the consequences of those outcomes, and the meaning of those consequences. This represents an irreducible tension between doing and knowing. We need to know in order to do, but we also need to do in order to know.

Commitment serves as a mechanism for projecting certainty and clarity onto a project´s desired outcomes. Yet it comes with baggage, the humility of not knowing everything. All the uncertainty surrounding what could happen needs to be bagged up and set aside. The more we commit to one particular unfolding of events the heavier the  bag containing the possibility of being wrong.

The Leader´s Role

When commitment and baggage move together, the baggage serves as a constant reminder of the need to focus on learning and to maintain the flexibility to change direction. No certainty is assumed. The illusion of certainty emerges only when the bag of uncertainty is hidden from view or otherwise detached. We argue that leaders must ensure the two always move together, for the future is often hidden in the bag.

However unintentionally, in many organizations the hierarchical relationships of accountability produce a separation between those facing uncertainty and those evaluating performance. Being accountable to someone is about being watched and judged, yet without them considering the uncertainty inherent in deciding what to do next. Practically, the uncertainty of outcomes sits on one side of time, while judgment and evaluation await on the other. Remember, action in the face of uncertainty is about doing before knowing. Judgment, on the other hand, is about knowing after doing.

Unhitched is organizational undoing

This is where something interesting happens in organizations: commitment and its counter-baggage of uncertainty get separated. Unhitched, the commitment slowly rises upwards, ultimately bringing a false sense of certainty to top management. In the meantime, the bag of uncertainty is left behind and settles on the shoulders of the middle managers or frontline staff. No matter how hard they try, they are left holding the bag. In short, as organizations pool frontline commitments they create synthetic certainty at the top at the expense of anxiety and stifled curiosity elsewhere.

Leadership facilitation

Over time, organizations accumulate all this baggage with pent up questions. Leadership is about slicing them open and facilitating meaningful discourse. The leader is a protector of uncertainty as intellectual humility and must be present anywhere innovation is taking place. Unlocking the potential of entrepreneurship is about replacing the quest for certainty with a quest for meaning.

About the Authors:
Joseph Pistrui is Adjunct Professor of Entrepreneurship & Innovation at IE Business School in Madrid, and co-founder of Kinetic Thinking.

Dimo Dimov is Professor of Entrepreneurship & Innovation at Bath University in the UK, and co-founder of Kinetic Thinking.

This article is one in the “shape the debate” series relating to the fully digital 12th Global Peter Drucker Forum, under the theme “Leadership Everywhere” on October 28, 29 & 30, 2020.
#DruckerForum

Ask not what the ecosystem can do for you, but what you can do for the ecosystem.

In the ‘paradox of thrift’, saving money is good for the individual consumer, but if everyone saved money the overall economy stagnates.

There is a paradox of managerial thinking in a networked world: staying in the shell of legacy brings internal comfort; but if everyone did it the ecosystem atrophies.

When it comes to innovating the ecosystem re-draws the boundaries of the organization. The value equation expands to include the social context of the system and your role and place in that system. What is at stake is the very shaping of the value the system creates, offering the rewards of enhanced status and influence.

In the age of ecosystems, there is no free ride in a system defined by its constantly evolving value equation. Even if you are on the right track you can be overtaken by the relentless progress of others. Any company that rises to systemic opportunities must be an entrepreneurial company, which begins with managers who think more entrepreneurially across traditional organizational boundaries. Here are two ways to do just that.

Drucker Forum 2019

This article is one in the “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

Forget Right and Wrong

Entrepreneurial thinking starts with recognizing that right-wrong categories apply only to the past. They need facts. Yet there are no facts in the future. Tomorrow brims with possibilities — it is seldom a replay of yesterday.

“Focus on the future” is an unassuming prescription for overcoming the limitations of legacy thinking. By simply looking ahead to a world not nailed down by facts and supercharged by ever-growing networks, the right-wrong label is always behind you — and it can never catch up with you.

The “kick in the teeth” of rejections and setbacks become signals of what does not work and serve as props for learning. To call such experiences “failures” is to remain locked in the past.

Look for what’s not there

Managers need to look for what’s not there, products or services that will address what Drucker calls incongruities of daily life and leverage evolving values and meaning.

Brian Chesky saw air beds in a world of ample hotels and motels, while James Dyson had a vision of a bagless vacuum in a world of bags.

Entrepreneurial thinking relies on what is possible in the marketplace and prompts us to “imaginate” (an old Scottish word) beyond what there is. Managers must look for what’s not there, empowered by the words of George Bernard Shaw: You see things as they are, and you ask “Why?” But I dream things that never were, and I ask “Why not?”

Being entrepreneurial values doing for the sake of doing. Only action can provoke the world to respond. Invite serendipity by keeping things in motion; remember: the future is shaped not by past facts but possibilities yet to be realized.

About the Authors:

Joseph Pistrui is Adjunct Professor of Entrepreneurship & Innovation at IE Business School in Madrid, and co-founder of Kinetic Thinking.

Dimo Dimov is Professor of Entrepreneurship & Innovation at Bath University in the UK, and co-founder of Kinetic Thinking.

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

“First, let’s fire all the managers” said Gary Hamel almost seven years ago in Harvard Business Review. “Think of the countless hours that team leaders, department heads, and vice presidents devote to supervising the work of others.”

Today, we believe that the problem in most organizations isn’t simply that management is inefficient, it’s that the role and purpose of a “manager” haven’t kept pace with what’s needed.

For almost 100 years, management has been associated with the five basic functions outlined by management theorist Henri Fayol: planning, organizing, staffing, directing, and controlling.

These have become the default dimensions of a manager. But they relate to pursuing a fixed target in a stable landscape. Take away the stability of the landscape, and one needs to start thinking about the fluidity of the target. This is what’s happening today, and managers must move away from the friendly confines of these five tasks. To help organizations meet today’s challenges, managers must move from:

Directive to instructive: When robots driven by artificial intelligence (AI) do more tasks like finish construction or help legal professionals more efficiently manage invoices, there will be no need for a supervisor to direct people doing such work. This is already happening in many industries — workers are being replaced with robots, especially for work that is more manual than mental, more repetitive than creative.

What will be needed from managers is to think differently about the future in order to shape the impact AI will have on their industry. This means spending more time exploring the implications of AI, helping others extend their own frontiers of knowledge, and learning through experimentation to develop new practices.

Jack Ma, co-founder of the Alibaba Group in China, recently said, “Everything we teach should be different from machines. If we do not change the way we teach, 30 years from now we will be in trouble.” Ma is referring to education in the broadest sense, but his point is spot on. Learning, not knowledge, will power organizations into the future; and the central champion of learning should be the manager.

Restrictive to expansive: Too many managers micromanage. They don’t delegate or let direct reports make decisions, and they needlessly monitor other people’s work. This tendency restricts employees’ ability to develop their thinking and decision making — exactly what is needed to help organizations remain competitive.

Managers today need to draw out everyone’s best thinking. This means encouraging people to learn about competitors old and new, and to think about the ways in which the marketplace is unfolding.

Exclusive to inclusive: Too many managers believe they are smart enough to make all the decisions without the aid of anyone else. To them, the proverbial buck always stops at their desks. Yet, it has been our experience that when facing new situations, the best managers create leadership circles, or groups of peers from across the firm, to gain more perspective about problems and solutions.

Managers need to be bringing a diverse set of thinking styles to bear on the challenges they face. Truly breakaway thinking gets its spark from the playful experimentation of many people exchanging their views, integrating their experiences, and imagining different futures.

Repetitive to innovative: Managers often encourage predictability — they want things nailed down, systems in place, and existing performance measures high. That way, the operation can be fully justifiable, one that runs the same way year in and out. The problem with this mode is it leads managers to focus only on what they know — on perpetuating the status quo — at the expense of what is possible.

Organizations need managers to think much more about innovating beyond the status quo – and not just in the face of challenges. Idris Mootee, CEO of Idea Couture Inc., could not have said it better: “When a company is expanding, when a manager starts saying ‘our firm is doing great’, or when a business is featured on the cover of a national magazine – that’s when it’s time to start thinking. When companies are under the gun and things are falling apart, it is not hard to find compelling reasons to change. Companies need to learn that their successes should not distract them from innovation. The best time to innovate is all the time.”

Problem solver to challenger: Solving problems is never a substitute for growing a business. Many managers have told us that their number one job is “putting out fires,” fixing the problems that have naturally arisen from operating the business. We don’t think that should be the only job of today’s manager. Rather, the role calls for finding better ways to operate the firm — by challenging people to discover new and better ways to grow, and by reimagining the best of what’s been done before. This requires practicing more reflection — to understand what challenges to pursue, and how one tends to think about and respond to those challenges.

Employer to entrepreneur: Many jobs devolve into trying to please one’s supervisor. The emphasis on customers, competitors, innovations, marketplace trends, and organizational performance morphs too easily into what the manager wants done today — and how he or she wants it done. Anyone who has worked for “a boss” probably knows the feeling.

The job of a manager must be permanently recast from an employer to an entrepreneur. Being entrepreneurial is a mode of thinking, one that can help us see things we normally overlook and do things we normally avoid. Thinking like an entrepreneur simply means to expand your perception and increase your action — both of which are important for finding new gateways for development. And this would make organizations more future facing — more vibrant, alert, playful — and open to the perpetual novelty it brings.

We want managers to become truly human again: to be people who love to learn and love to teach, who liberate and innovate, who include others in the process of thinking imaginatively, and who challenge everyone around them to create a better business and a better world. This will ensure that organizations do more than simply update old ways of doing things with new technology, and find ways to do entirely new things going forward.

About the Author:

Joseph Pistrui is Professor of Entrepreneurial Management at IE Business School in Madrid. He also leads the global Nextsensing Project.

Dimo Dimov is Professor of Entrepreneurship & Innovation at Bath University in the UK, and co-founder of Kinetic Thinking.

Drucker Forum 2018

This article is one in a series related to the 10th Global Peter Drucker Forum, with the theme “Management. The human dimension” taking place on November 29 & 30, 2018 in Vienna, Austria.

This article was first published in Harvard Business Review