This is the gala dinner of the 4th Peter Drucker Forum, the Austrian- born writer, teacher and consultant, who was once tagged as “the Man who invented management.” He liked to call himself a “social ecologist” – i.e. someone who deals with the man-made social environment in which we operate.

For two days last week, an eclectic mix of close to three hundred corporate executive, entrepreneurs and prominent members of Academia from all over the world gathered at the heart of the Austrian capital to debate and reflect on the future of Capitalism – no less!

The Forum covered a wide array of topics from role of education to the emerging needs of social entrepreneurship.

Squarely rooted in what we would now tag as more than familiar emerging global trends:

• The unfolding worldwide value crisis
• A burning imperative to reconcile profit and social justice, or as mentioned by Georg Kraft-Kinz the Deputy CEO of Raiffeisenlandesbank Noe-Wien and Holding, ‘economic success needs to be combined with welfare.’’
• The raging talent war where… “Talent won” joked legal Peter Y. Solmssen – Member of the Managing Board and General Counsel of Siemens
• The need to re-kindle economic elasticity via fostering entrepreneurship, that by the way can be taught as asserted by Dan Shechtman Professor Technion Israel Institute of Technology, Department of Materials and 2011 Nobel prize laureate in Chemistry
• The impact of social media in traditional and emerging economies

The conference was however, thought provoking and innovative. It positioned itself as providing orientation in the jungle of ready made solutions and answers. Getting participants thinking in new ways about key issues was a key objective.

It was particularly evident in their challenge of the sacrosanct concept of shareholder value.

Shareholder value was for once not tagged as necessary evil that one would have to accept and live with, but as a concept in great need of tweaking and repackaging as Roger L. Martin, the dean of Rotman School of Management eloquently described.

The notion of “comprehensive profit” – profit that would harmoniously balance short-termism and sustainability was presented and debated, but not in a vacuum.

Different operating models – from customer owned companies, to entirely non-profit organization, from global partnership, to state-owned entities were presented to give a framework or contextualized the concept. The models worked as a large term of reference to explore, pick and choose, mix and match.

This desire to show potential paths for evolution was even clearer when the role of education was tackled and the need of constant learning to engrain in the wonderful world of corporate.

“Corporate acts as environment were not enough space is given to develop new mental maps of thinking” mentioned Thomas Sattelberger Vice-President Board of Trustees, European Foundation for Management Development (EFMD). the role of business schools of the future would be to act as laboratories of creations of ideas and minds.

“Opening closed systems, by pushing the exploration side to the traditional exploitation side that corporations cherish so much is the name of the new game, creating army of volunteers workers that feel thriving” he added.
Roger Martins Opposable mind meets purpose driven millennial- should be the battle cry of any corporate executive.

So what it is to bring back home?

The first thing is thinking differently, breaking free from some of the old models is the only way to create a paradigm shift. There is a community of kindred spirits in the Peter Drucker Forum- ready to step in and help. It is a question of taking the first step and reaching out.

The second thing, and it will appear counterintuitive, the community of kindred spirits that showed up in Vienna was largely European, educated, born and raised. It comes with predefined psyche and patterns.

As the executive of a prominent pharmaceutical company currently stationed in Brazil mentioned, “There is an emerging theme in Brazil- Capitalism is too important for us to leave it to the capitalists. Emerging countries want to create their model of capitalism and, actually of leadership that talk to them, makes sense for them.”
Europe and the US are not longer the reference. Asia is too fragile stuck between Lee Kwan Yew benevolent leadership and the new direction of China 18th Party directives Africa is still suffering from perception issues hard for westerners to truly overcome.

The world currently emerging is still hesitating between a muli-polar structure or a truly global and collaborative structure. What is it going to be and how can we influence it?

This is the challenge I want to pose to the 5th edition of the Peter Drucker Forum, let’s hear it from the BRIC, the next eleven, the women, the twenty something, and the African – they ARE the paradigm shift- let’s debate collaboration and technology they are the driving shaping forces of economies and leadership of tomorrow… Until 2013.

AUTHOR:

Marianne Abib-Pech has led a highly successful international career in finance. She left France, her home country, in her twenties to study Finance and Business organization at Herriot-Watt University in Edinburgh. She then worked for some of the most admired corporations of the past twenty years, from Arthur Andersen and Motorola to General Electric and finally Shell, as Global CFO of one of their downstream divisions. She was the only woman ever hired externally at this level of the finance organization in Shell.

Throughout her career, she has been exposed to the best leadership training possible and always demonstrated a keen interest in developing leaders within and outside her own teams.
Marianne is the Founder of Leaders! a global leadership consultancy and think tank operating in Europe and Asia. Leaders! Specifically focuses on leadership emergence, leadership transformation and cognitive diversity – gender, cultural and generational – to create business value.
Marianne is a regular columnist in The Huffington Post, The Independent and Global Corporate Venturing. The Financial Times Guide to Leadership is her first book.
She currently splits her time between Hong–Kong, London and Paris.

This post was first published on http://www.huffingtonpost.co.uk.

There is a hope that we can get out of the current economic crisis by embracing emerging management practices based on collaboration, autonomy and decentralization (which were all promoted by Peter Drucker), and by changing a mindset from the one that focuses on personal gratification to another that seeks to find a deeper meaning of work that is greater than any individual aspirations, and that is focused on making a positive difference for individuals, organisations and society.

In my own endeavour to make this world a better place, I have founded the Drucker Society London, one of the twenty Drucker Societies operating around the world. The aim of the Drucker Society London is to promote responsible management practices based on Peter Drucker’s ideas. One of our core activities is to teach young people self-management and entrepreneurial skills based on the Drucker’s Future Leaders Programme. I am delighted that we plan to teach workshops based on this Programme to WBS undergraduate students as a part of Employability module sometime next year.

If anyone would like to join the Drucker Society London and help us to make a difference for the future generations please contact me on hlupicv@wmin.ac.uk.
Professor Vlatka Hlupic

This post was first published on http://blog.business.westminster.ac.uk

We pondered the basic question that Peter Ducker often asked when he worked with managers: “What is needed?” And we took on the tougher question that Drucker used to close every conversation: “What are we going to do about it?”

What is needed?

No matter what their ages or backgrounds, participants agreed that the foremost challenge around the globe is youth unemployment.

Lynda Gratton  of the London School of Economics  arrived in Vienna from the World Economic Forum in Dubai, where experts  warned of daunting jobless numbers. “If you have youthful unemployment in Spain or Greece  rapidly coming north of 40 or 50 percent,” Gratton said, “there is unrest.”

We can prattle on about the spread of democracy in the world, but if we don’t address youth unemployment, democracy will retrench.   Indeed, we risk more autocracies and extremist governments to deal with the rising tide of disaffected teens and 20-somethings.

Paul Polman, CEO of Unilever, described witnessing a haunting scene upon returning to Newcastle, a city built on steel and coal:  “For the first time in my life, I saw second-generation unemployment.” He explained that this generation of young people had never seen their parents work. In fact, the only path out of misery they could see was having a baby – because that, at least, seemed a tangible possession.  Yet as young, jobless parents, they found themselves further mired in poverty.

“That galvanized me to do something more than have a brilliant career and make a lot of money,” Polman said. The challenge, he conceded, is enormous.

The angst of  young people was evident in the forum’s annual  student essay competition.   Of the 101 essays submitted, more than 90 focused on the lack of jobs.  Most also called on the youth themselves to invent jobs and start businesses, yet  lamented that such skills aren’t valued by their parents or taught in school.

All across the conference center, in a babble of English, German, Mandarin, Korean and other languages, participants grappled with the implications of youth unemployment.  The biggest issue the world faces now is not sustainable growth, the troubles with the euro, or indebted countries with no reserves. It is the rift between the youth and the rest of society, which stands to tear apart the social fabric.  And we have no solutions, not even realistic hypotheses for ending the unemployment of the next generation.

Ironically, this is the same issue Peter Drucker wrote about in his first book, The End of Economic Man –  the issue he credited with enabling Hitler’s  rise to power.

What are we going to do about it?

Creative thinkers and doers—from chief executive officers of multinationals to unknown masters of start-ups, from students to social enterprise champions—proposed solutions in Vienna. There was a resolute sense of “we” in every conversation. Again and again, they called for abandoning  tired traditions and charting new ways.

The large corporate CEO:  On his first day as Unilever’s CEO, Paul Polman stopped quarterly reporting to analysts.   That may sound counter-intuitive for one of the world’s leading publicly-held companies – one that is beholden to shareholders – but Polman  wanted to send a strong signal about priorities.

“I have better things to do with my time than report every 76 days about the weather impact, et cetera,” he said. Unilever has set as its goal doubling revenue and halving its carbon footprint over the next five years. The two are working together. Unilever has been able to modify its outdated, bulky pension system to invest money in youth training and cross-internships with not-for profits including Oxfam and  Forum for the Future, and so on.  Unilever also started an apprenticeship program based on the German model, offering a combination of jobs and training.

The result? Young people are learning from internships, apprenticeships, and training programs, positioning themselves to participate in the business world. Stockholders are having conversations about the long-term, for the company and for society. And consumers like what Unilever is doing and are buying more products.

Martin Curley, director of Intel Labs Europe, described the impact of opening Intel’s  innovation process to universities and other companies:  “When we let youth participate, they not only gain experience interacting with a corporate organization but also have an impact on results.” This more open innovation process with student input drove growth at what had been a flat company for years.

Social entrepreneurs. Bill Liao was one of many social entrepreneurs who spoke passionately about how people around the world are using well-crafted business practices as a force for good. For example, there’s a need for talented computer coders. One of Liao’s firm’s projects, named CoderDojo, is a movement that enlists volunteers to teach children to understand computers and code.

Since coding is a language skill, children who learn early become what Liao dubs “coder poets,”  who can get more impact from fewer lines of code. Society gains adept, top-notch coders, and the children gain a foundation for marketable skills. “Everything is free on every level,” Liao marveled.  “We don’t work for money, we work for impact, and it works!”  He’s not kidding.  Because CoderDojo is a movement without administrative fees, salaries, or costs of any kind, it doesn’t even have a bank account.

Academics. Nobel Laureate Dan Schectman of Technion Israel Institute called for sophisticated training to start early. He teaches kindergarten students physics:“This is the age they can learn. This is a language they understand and will grow with them.” He also teaches engineering students entrepreneurship—a class that is continually over-enrolled.  He talked about the need for entrepreneurs to recognize that ideas are not enough—they need to be managed.  He is helping kids be entrepreneurs and job creators.

Startups. Speakers talked of startups building businesses, all on the new model of cross-organization resources seeking high impact.   For example, Etventures is a place for large corporations to take their ideas to be nurtured and built up as innovations.  Qwalify is a site for individuals to find their strengths and be matched with organizations that need those skills – a matchmaker for employees and employers. Young thinkers are powering these developments, and every success grows the economy and the employment base.

Engaged citizens. Citizens, led by the young, are playing vital roles in creating   social change, such as fighting corruption.  They’re harnessing the transparency offered by the web and social media. John Quelch described a video of a man destroying his defective refrigerator, which has been seen 170 million times in China. He spoke of a fatal train derailment that could not be obfuscated by the authorities because images went viral on YouTube. Efforts like this motivate young people to participate in organizational life and sharpen practical skills.

Consultant Tammy Ericson described how, in these times, everything is visible to everyone, which brings to mind another Drucker quote:  “I just look out the window and see what is visible—but not yet seen.”

What is visible but not yet seen is the power of ordinary Chinese college students to thwart corruption. . . of young entrepreneurs crossing organizational boundaries and building bridges to what used to be unimaginable. . .  In short, organizations and citizens, young and old, are creating a new social contract, which will form the basis of Capitalism 2.0.

AUTHOR:

Elizabeth Haas Edersheim , author and consultant, is founder of NYCP – a management lab –  and architect of The Elements of Management Effectiveness, ThEME, available as an iPad app and in a customized version reflecting quotes and ideas from the Forum .  She worked with Peter Drucker in the last years of his life and authored The Definitive Drucker

 
The key aspect of a management paradox is that it contains two equally valid, but contradictory viewpoints which need to be managed over time so that neither one is totally neglected. Work-family balance is one of the easiest paradoxes to understand, but there other many others in business such global-local balance and quality-cost management.

 
While philosophically many would agree to the expansion of corporate responsibility from maximizing shareholder value to creating shared value for society, the current forces in place allow little deviation from a corporation’s original responsibility to maximize shareholder value. The vast majority of these forces are not Wall Street greed (although this is obviously a factor), but the fact that our global economic system has built a dependency of investors, including pensioners around the world, on a consistent return on investment from the corporate sector. As a result, the pressure from the investment community to keep corporations focused on maximization is relentless. Under these circumstances, how will the role of the corporation be expanded to include a better balance of shareholder value and shared?

 
I believe the answer is very simple and very complex – it will depend on leadership. Leadership that is committed to managing the paradoxes of profit and purpose and short-term vs. long-term needs.  And there are signs that the next generation of leaders, as well as their corporate and academic mentors, are taking on that commitment. Consider the following.

 
In January 2009, in the middle of the financial meltdown, I conducted a session on global leadership for the Young Global Leaders at the World Economic Forum in Davos. The Young Global Leaders are 150 leaders under 40 chosen by nomination and are considered to be some of the best and brightest young leaders from all parts of society and the world. They attend the World Economic Forum to provide input on what the younger generations are seeing and thinking about the issues discussed during the Forum.

As part of the preparatory day I spent with them, they were asked to work in small groups to analyze what they thought were the primary reasons for the economic turmoil in which the world found itself. After much deliberation, their report-outs can be summarized in two conclusions:

• They felt the current generation of leadership had defined the scope of its responsibility too narrowly. These leaders had not just maximized shareholders’ value, but also had maximized personal bonuses, and the success of their corporations at the expense of everyone else. The young leaders believed that their generation would have to redefine this scope of responsibility to be more inclusive of others in their society and in the world. In other words, they would needed to see themselves as “global leaders” as  well as “local leaders.”

• These young leaders also believed the current leadership generation defined their responsibility in too short a timeline. They felt that concentration on short-term returns without adequate consideration for longer-term sustainability had reached a point of no return. They felt their generation would be faced with balancing these forces more than ever before.

Think scope and time – broader scope and longer timeframes of responsibility are needed for leaders to sustain corporations as engines of shared value for society today and tomorrow.

 
In the end Capitalism 2.0 will be about leadership.  It is easy to acknowledge the merits of Capitalism 2.0, but implementing a broadened agenda will require leaders who have the courage to stand for a new vision of the corporation. Globally responsible leadership begins with the vision that a leader has for his or her stewardship. The best leaders understand that leadership is not about them, but about what they enable others to do for their organization and the world.

Guest Blog Post by Stephen Rhinesmith

www.stephenrhinesmith.com