Unser digitales Sommerforum ist ein Meilenstein auf dem Weg zur Konferenz, die uns im November in der Wiener Hofburg persönlich zusammenführen wird. Beide Veranstaltungen firmieren unter einem gemeinsamen Titel: Performance that matters – Leistung, auf die es ankommt.

Wie misst man die Leistung eines Unternehmens? Das scheint heute noch komplexer als früher. Zu Druckers Zeiten bezeichnete «Leistung» einfach die wirtschaftliche Leistung. Drucker betonte, dass ein Unternehmen in wirtschaftlicher Hinsicht erfolgreich sein muss, bevor es Ressourcen für andere Ziele erübrigen kann. Allerdings wies er auch darauf hin, dass Unternehmensführung ein moralisches Unterfangen sei: Die Erhöhung der Gewinnspannenoder die Schaffung von noch mehr Shareholder-Value könne nicht die einzige «raison d’être» sein – vor allem wenn man bedenkt, welche Auswirkungen Unternehmen auf Kunden, Arbeitnehmer, Gemeinden und letztlich die Umwelt haben.

“Zwei Jahre nach meinem Tod wird sich niemand mehr an mich erinnern.“ Das meinte Peter Drucker in einem seinen letzten Lebensjahren zu seiner Frau Doris. So berühmt er auch gewesen sein mochte, so sehr war ihm bewusst, dass Erinnerung rasch verblasste. Im ersten Jahr des Druckerforums versprach ich unserer Mentorin und Freundin Doris Drucker daher, dass wir hart daran arbeiten würden, die Erinnerung an Peter Drucker hochzuhalten. Gerade in Zeiten von Krisen und Verwirrung können wir so viel von ihm lernen! Und tatsächlich sind wir darum bemüht, sein geistiges Erbe zu ehren, indem wir drängende Managementfragen ernsthaft und
tiefgreifend zu analysieren versuchen.

Den Background für das diesjährige Forum liefert die wohlbekannte Abfolge der jüngsten Krisen – mit Pandemie, Lockdowns und dem Krieg inder Ukraine. Nicht zu vergessen jene Probleme, die schon viel länger unter der Oberfläche köcheln: steigende Verschuldung, die Spaltung der Gesellschaft, wachsende Ungleichheiten, eingeschränkte Freiheit und Privatsphäre oder zunehmende Bürokratisierung. Jahrelang konnten wir uns durchschummeln – nun aber droht der Riesencrash. Oft spricht man im Zusammenhang mit dem Nachhall einer Krise von einer «neuen Normalität», die sich einstellen würde. Was uns jedoch droht, ist deutlich ernster – und wesentlich größer. Es ist, als ob sich vor unseren Augen eine neue Weltordnung herausbilden: sowohl geopolitisch als auch sozial und wirtschaftlich. Wir sind Zeugen der Geburt einer neuen, anderen Welt – ein schmerzhafter und gefährlicher Prozess.

Was wir bisher für ein unerschütterliche Tatsache hielten, wird mit einem Mal obsolet: etwa die Annahme, dass Globalisierung einuneingeschränktes Gut, Inflation leicht zu zähmen sei und Zinssätze auf Dauer niedrig bleiben würden; dass die effizientesten und robustesten Lieferketten globale seien, dass reife Volkswirtschaften immun wären gegen Nahrungsmittel- oder Energieunsicherheit, dass Gesundheitsversorgung immer effektiver und zugänglicher würde, dass Armut überall zurückgehe und die Gefahr eines Atomkriegs ein für alle Mal gebannt sei.

Drucker stellte fest, dass die großen Einkommens- und Wohlstandszuwächse in der Welt auf die verbesserte Leistung von Organisationen und Institutionen zurückgeführt werden können – zunächst im Westen nach der industriellen Revolution und in den letzten Jahrzehnten zunehmend auch in Schwellenund Entwicklungsländern. Was wir als „Management“ bezeichnen, ist dabei nichts anderes als eine enorme soziale Innovation. Wir vergessen gern, dass die immensen Wohlstandsfortschritte, die wir im Westen in den letzten zwei Jahrhunderten erlebt haben und die uns hochdifferenzierte Bildung, gute Gesundheitsversorgung, Sozialsysteme und Mobilität gebracht haben, nicht allein auf den Fortschritt in Wissenschaft, Technologie und Innovation zurückzuführen sind. Die neue Sozialtechnologie, das so genannte Management, hat es möglich gemacht, in großem Umfang Werte zu schaffen, die das Leben so vieler Menschen verbessert haben. Ein neuer CovidImpfstoff etwa wird niemandem helfen, wenn wir nicht in der Lage sind, ihn in großem Maßstab zu produzieren und an diejenigen zu verteilen, die ihn brauchen.

Nach dem Zweiten Weltkrieg hatten wir viele gute Jahre, was vor allem im Westen zu einer gewissen Selbstgefälligkeit und ideologischen Hybris führte. Doch wie Andy Grove von Intel es so treffend feststellte, führt selbstgefällige Zufriedenheit mit dem Status Quo geradewegs in den Untergang. Was wir in der Zeit nach der industriellen Revolution aufgebaut haben, ist keine Selbstverständlichkeit: Allerdings dürfen wir uns nicht auf dem Erreichten ausruhen, sondern müssen auf Innovation und Erneuerung setzen, um auch in schwierigen Zeiten erfolgreich zu sein.

Gutes Management besteht zu einem großen Teil darin, Prioritäten zu identifizieren. Und es werden nicht jene von gestern sein! Was wir über Energie, Ernährung, Klima, Effizienz, Inflation, Arbeit und Management dachten, wird neu bewertet werden müssen. Möglicherweise werden wir auch Kompromisse eingehen, die früher nicht denkbar waren: Wirtschaft versus Soziales versus Umwelt, kurzfristig versus langfristig – wenn etwa eine Hungersnot droht, kann es sinnvoll sein, die Angst vor gentechnisch veränderten Lebensmitteln zu überwinden. Einer der «positiven» Nebeneffekte der Megakrise könnte sein, dass wir uns klarer darüber werden, was für die Menschheit wirklich zählt. Von der politischen Führung über die Manager bis hin zu den Akteuren der Zivilgesellschaft: Sämtliche Akteure werden ihre Agenda überdenken müssen. Mehr vom Immergleichen ist nicht (mehr) gut genug.

Diese kritische Selbstbetrachtung gilt auch für die Praxis des Managements selbst: Wie viel vom Management des 20. Jahrhunderts ist heute noch gültig? Wenn Druckers Postulat immer noch aktuell ist – nämlich, dass die Aufgabe des Managements darin besteht, die richtige Balance zwischen Kontinuität und Wandel zu finden – wie entscheiden wir dann, was bleibt und was geht?

Jamie Dimon von JP Morgan sagte einen drohenden wirtschaftlichen Wirbelsturm voraus. Gleichzeitig warnte er davor, sich zu verstecken und zu versuchen, die Krise auszusitzen: Wir müssten uns der Herausforderung stellen. Politiker werden schnell an ihre Grenzen stoßen,wenn es darum geht, Gelder auszuschütten, die sie nicht haben. Das Überleben, geschweige denn der Fortschritt, wird von denjenigen abhängen, die bereit sind, die Herausforderungmit ganzem Einsatz anzunehmen und zu stemmen: Unternehmer, Innovatoren, Manager und Beamte, die durch ein gemeinsames Ziel verbunden sind. Schließlich geht es um nicht weniger als darum, eine lebenswerte Welt für die Generationen nach uns zu schaffen. Ein Weg, der nur frei von Ideologie beschritten werden kann. Und mit einem starken Sinn für das Machbare.

Dies ist auch die Dynamik, die wir mit dem Druckerforum entfesseln wollen. Falls Sie sich fragen, welchen Einfluss ein Einzelner haben kann, so erinnern Sie sich nur an die Komplexitätstheorie und was sie über das
Handeln lehrt: Bekanntlich kann der Flügelschlag eines Schmetterlings einen Luftstrom erzeugen, der stetig an Kraft gewinnt und schließlich zueinem Sturm irgendwo auf der Welt wird. Lassen Sie uns beginnen, unsere eigenen kleinen und großen Flügelschläge zu erzeugen, um die Welt zum Besseren zu verändern.

Ich wünsche uns allen eine großartige Konferenz und eine fundierte und ernsthafte Diskussion über Leistung, auf die es ankommt – für den Einzelnen, für das Team, die Organisation, das Ökosystem und die Gesellschaft insgesamt.

This Digital Forum is a big step on the way to our in-person Forum in November in the Vienna Hofburg. The two events share one overarching theme – performance that matters. Moving the needle on the performance of an enterprise has always been a challenge – and in today’s world it is increasingly complex. In Drucker’s day, “performance” simply meant economic performance—and Drucker himself emphasized that an enterprise must succeed in economic terms before it could devote resources to other objectives. Yet Drucker also stressed that taking on the responsibility of managing a business was a moral undertaking. Expanding profit margins, or creating more shareholder value, could not be the sole “raison d’être” given the very real impact organizations have on their customers, workers, communities, and natural environment.

Doris Drucker, our friend and mentor when we launched the Drucker Forum in 2009, told me about a comment Peter Drucker made in the last years of his life. Famous as he then was, he also knew how quickly the public memory fades. “Two years after I’m gone,” he said, “nobody will remember me.” I told Doris we would work hard to prevent that, because the world still has so much to learn from Drucker – and we especially need his wisdom now, in a time of crisis and great confusion. We try to honor his spirit by taking a broad and deep perspective on the most pressing questions of our time as they relate to management, and not hosting the kind of superficial, politicized, mainstream discussion that can be found in many places.

The backdrop to this year’s Forum is the recent sequence of crises we have experienced in the pandemic, the lockdowns, and the Ukraine war. But there have also long been other major issues smoldering under the surface: mounting debt levels, increasing fractures in our societies, worsening inequalities, diminished freedom and privacy, growing bureaucratization of our lives, and more. For years we were able to muddle through – but now we face a threat of mega-disruption. People often talk about the aftermath of a crisis as settling into a “new normal”—but this is bigger. It seems a new world order is emerging in front of our eyes: geopolitical, social, and economic. A very different world is being born – in a painful and perilous process.

Some basic assumptions are being swept away: for example, that globalization is an unalloyed good, that inflation is easy to tame, that interest rates will remain low in perpetuity, that the most efficient and robust supply chains are global ones, that mature economies are immune to food or energy insecurity, that health care will become ever more effective and accessible, that poverty is everywhere on the decline, and that conflicts will never go nuclear, to name just a few.

Drucker observed that, where there have been great gains in income and wellbeing in the world, they have derived from the improving performance of organizations and institutions – first in the west, after the industrial revolution, and in recent decades increasingly in emerging and developing countries as well. We tend to forget that these immense gains – including comprehensive education systems, universal healthcare, research institutions, social protection and mobility – were not the product of science, engineering, and research alone. It was above all the new social technology called “management” that drove the value creation at unprecedented scale that improved so many lives.

We had many good years after the Second World War, building societies that were successful by numerous measures – and, especially in the west, this led to some complacency and ideological arrogance. But as Intel’s Andy Grove observed, complacency breeds failure, and he might also see now as the moment to inject a degree of paranoia into our thinking. What we have acquired in the time after the industrial revolution is not a given: we have to defend it, again and again, and avoid major breakdowns with their catastrophic consequences for humanity.

Much of good management is about focusing on the right priorities. No longer can we treat the priorities of yesterday as the priorities of today. What we thought about energy, food, climate, efficiency, inflation, work, and management will not necessarily be the same in the future. New trade-offs may be required: economics vs social vs environmental, short term vs long term – so when famine threatens, we may need to move past fears of GMOs, for example. One of the “positive” side-effects of the mega-crisis may be that we get more real about what is really important for human life. From political leaders to managers to civil society players, all actors need to review their agenda. More of the same is not good enough. Extrapolating their narratives to the future won’t work any more, if  it ever did.

This critical introspection applies to the practice of management as well. How much of 20^th century management remains valid today? What classic principles of management still apply and what should change? If Drucker is still right that management’s job is to strike the right balance between continuity and change, how do we decide what stays and what goes?

JP Morgan’s Jamie Dimon recently predicted a looming economic hurricane in the wake of the consecutive Crises we experience. But he warned that we shouldn’t try to hunker down to sit out the crisis. We need to step up to the challenge. Politicians will quickly come up against the limits of bailing out anyone in need with money they don’t have. Survival, let alone progress, will be down to those who are ready to take on the challenge with their flesh, blood and brain  – entrepreneurs, innovators, managers and civil servants driven by a common purpose grounded in an urgent sense of reality to build a future for the generations to come. Ideology, of whatever color, will be a bad guide to the future.

This is the energy we want to inspire at the Drucker Forum. You might ask what influence any one of us can have individually. Yet think about complexity theory and what it teaches about taking action. Famously, the flap of a butterfly’s wing can generate an air current that gathers force and eventually becomes a giant storm somewhere in the world. Let’s each start making our own moves, large and small, to change the world for the better.

I wish us all a great conference and a continuing deep and serious discussion on performance that matters – for the individual, for the team, the organization, the ecosystem and society at large.

This year we have – we believe – made good progress in moving out of the worst of the crisis cycle triggered by Covid. But we have absolutely no cause for complacency.

To head off social and economic breakdown, governments and central banks have borrowed from the future in unprecedented ways. And during the crisis digital technology has shown both sides of its Janus face: affording huge benefits in the international collaborations that have given us life-saving vaccines at record speed, at the same time as endangering freedom and self-determination in the way it has been used to manipulate attitudes and blur or deny the truth.

Drucker Forum 2021

This article is one in the “shape the debate” series relating to the 13th Global Peter Drucker Forum, under the theme “The Human Imperative” on November 10 + 17 (digital) and 18 + 19 (in person), 2021.
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As we emerge from Covid, attention will have to shift from spending to actually earning the advances we have taken. There is only one way to achieve this – broad-based innovation and value creation, which puts a premium on better management than we have ever achieved before. As Peter Drucker proclaimed, only well-managed organizations and institutions can generate a society that is at the same time both high-performing and human. A perfect society is unachievable by humanity, and therefore, whatever the techno-utopians think, deeply inhuman; but a democratic, functioning one is within our reach.

The bottom line is that the human being in all its imperfection and splendor cannot be replaced by technology, as some people would like to suggest. All important issues must be viewed through the human lens first, not from a technology perspective. This is the stand that we want to make in the face of an increasingly technology-centric world. Drucker gives us the legitimacy and the vision for a well-functioning human society powered by effective organizations and institutions​ – and thus also a positive basis on which to bring together technologists and humanists in a constructive global dialogue on a future that must be both digital and human. But always human first. ​Let our conference mark the beginning of this historic process.

The Drucker Forum journey that we have mapped out this year closely reflects these new realities. In June we brought together our community for a virtual Day of Drucker, something we could only do with the aid of digital technology. But the aim was to prepare the ground for this Forum– two days of virtual events culminating in this face-to-face event on ‘the human imperative’.

In this spirit we cordially welcome you back to Vienna for the 13th Peter Drucker Forum, destined to be one of the most important ever.

Richard Straub

Founder and President

This article is one in the “shape the debate” series relating to the 13th Global Peter Drucker Forum, under the theme “The Human Imperative” on November 10 + 17 (digital) and 18 + 19 (in person), 2021.
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As exponentially advancing digital technology transforms so much of work and the world, questions inevitably arise about the place of the human being. Some warn of a diminishing role for the human, such as in decision-making, starting perhaps with the simple tasks now performed by chatbots, but soon enough in more creative problem-solving. It is easy to imagine technology’s superhuman powers – its advanced algorithms, deep learning networks, and other AI strengths, its Blockchain dynamics, big data processing, and so forth—taking us inexorably toward the Singularity Ray Kurzweil envisions.

The questions are all the more urgent given the rate of change around us. It’s true that the future is always uncertain – remember the old quip, “prediction is difficult, especially about the future” – but today we are faced with heightened, and seemingly increasing, turbulence. Many look to technology to provide the confidence needed to navigate through uncertainty.

Yet there is a countercurrent emerging that calls for reasserting the human role. The experience of cities and nations responding to the COVID-19 crisis has emboldened these voices, as it highlights the human creativity and judgment essential not only to balance competing social and ethical priorities but to accomplish scientific breakthroughs and overcome logistical challenges. The same countercurrent is rising inside organizations where “data-driven” decision-making so often falls short of the sound judgment that, however tainted by cognitive biases, combines science with common sense.

As economic, fiscal, cultural, and political crises escalate in the wake of pandemic, the tension between the technocratic and the humanistic forces is reaching a breaking point. The former see a time of upheaval as an opportune moment to effect a large-scale “reset” to a system currently flawed in many ways. The latter reject any such revolutionary redesign as inimical to human nature which craves, as Peter Drucker put it, a balance between “change and continuity.” Which is the best way forward, and how can we ensure that it prevails? 

Leading thinkers at our 2021 Forum will grapple with important questions including but not limited to the following:

• Must there be a human imperative at the core of organizations? How would we define it? What threatens it most today? How could good management serve it better?
• Forced to make decisions under highly dynamic conditions, should organizations rely more heavily on data and analytics? What are the risks of moving away from human judgment?
• Do we need better ways of discovering truth and thinking through the complex issues of our time? What insights should we take from philosophy, psychology, and other realms to prepare our minds for the age of AI?
• What should we hope for—and fear—in the aftermath of a year of remote working? Will less in-person contact become the norm? How might human beings as social animals and community builders respond?
• What lessons can we take from the Covid-19 crisis about the clashing perspectives of scientific experts, policymakers, business leaders, and ordinary citizens and workers—and how they should be prioritized or integrated to best serve the needs of humanity? 
• As in every time of upheaval, some today say we should not let “a serious crisis go to waste.” But is seizing the chance to enact sweeping change a humane impulse? What can we learn from the history of sudden revolutions, whether political, cultural, or organizational?
• Central to the human condition is the ability to learn from evidence and experience—both our own and others’. How is it, then, that human organizations prove so resistant to collective learning? How do we stop making the same mistakes?
• What changes to management education would better equip managers with the knowledge and competences they need today? Are there useful models to be found in how other professions are mastered?
• Peter Drucker insisted that to be a change leader, an organization must also “establish continuity internally and externally.” But that human-friendly balance he advised means nothing to a computer. Is it still valid as a principle for management?
• So much of recent human achievement has resulted from growing capabilities in administration and leadership that the past hundred years have been called “the management century.” How can we extend that run and make even greater progress in the future?

This article is one in the “shape the debate” series relating to the 13th Global Peter Drucker Forum, under the theme “The Human Imperative” on November 10 + 17 (digital) and 18 + 19 (in person), 2021.
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Welcome to the Drucker Forum 2020, with a theme this year of “leadership everywhere.”

It is a theme we chose a year ago, before anyone could know the challenges that 2020 would bring. As it turned out, this year cast a bright spotlight on the performance of leaders everywhere – and the light has not always been flattering.

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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We all know that the quality of leadership matters in a crisis, but I think we tend to think of that as a set of reactive skills – as in, leaders who can respond quickly to terrible events and make sense of chaos. Just as important is to think of the proactive challenge – having a good leadership system in place well in advance of a crisis so that an organization or a society can weather the storm when it hits. We have all learned in this year of pandemic how the people who are at greatest risk are those with preexisting conditions. The same is true for organizations and societies: many of the worst hit had chronic issues limiting them – and I would suggest that the most debilitating preexisting condition for some has been their leadership deficiency.

Perhaps the most striking lesson about leadership we can take away from this year is that leaders have an enormous responsibility to understand when tradeoffs have to be made between conflicting  priorities. This was the point of an article that Roger Martin, Julia Kirby, and I published recently with Harvard Business Review. Perhaps you have seen it. We urged developing leaders not to make the mistake of relying on technocratic methods when the decisions they face are really about what weights to place on competing values.

Another big leadership lesson of 2020 has been that finding a path to an acceptable balance requires not  only wisdom but courage. Courage is not waiting to see how things trend on social media, and caving in to the most strident constituencies – and neither is that leadership. It is, at best following, and possibly following in a very wrong direction.

And finally, even a smart and courageous leader can fall short if he or she doesn’t have legitimacy. This year’s reminder of that came from the policymakers and executives who talked the most about how they would do nothing but “follow the science.” Only leaders who have failed to earn the trust of their people have to rely so heavily on the borrowed authority of experts.

All this is true in business, as well. Data give us fragments of reality, but sound human judgement remains indispensable. In complex situations, it is folly to rely on one single domain of expertise to determine the way forward. Great leaders are great synthesizers, able to call on multiple perspectives, including history and philosophy. Education and culture matter.

When I asked Doris Drucker 10 years ago what was most important to Peter, her answer was clear: it was the human being, not as a slogan but in all its complex reality. Of course, humans are toolmakers, and we want technologies, including in digital form, to make important contributions by making work easier and filling human needs. But to create and support a functioning society, leaders can’t center their attention on technology development and adoption. They must be first and foremost devoted to realizing human potential, and always working to deepen their human understanding and connections.

It’s no accident that concerns like these were central to the work of two distinguished management thinkers to whom, with a heavy heart, we say goodbye this year. One is our friend and mentor Clay Christensen. If you have been to past Forums you may have met him or heard him speak. Please try to take part in the special tribute to his ideas and impact that we have included on the program. The other lost friend is Joseph Maciarello, Peter Drucker’s closest collaborator at Claremont and perhaps the nearest thing he had to an academic successor. Joe’s focus was on management as liberal art, and he worked tirelessly until the end to bring this founding concept to life for students and managers.

I am the first to admit that a virtual format cannot replicate the richness of the conversation and connections with old and new friends that have always been central to the Drucker Forums in Vienna. But in a very Druckerian way, we have risen to the challenge of weaving together threads of change and continuity. Our digital team has been phenomenal in their efforts to ensure that our online experience will be well ordered and satisfying. You will find new ways to engage with content, speakers and with fellow conference participants. And certainly you will find much content to choose from: we are proud that the 2020 program features the richest menu of options we have ever offered and a truly unprecedented slate of thinkers, practitioners, and moderators. In fact, there is no way you could experience it all in the space of a few days, so we are making replays of all sessions available to conference participants.

As for that usual great benefit of conference attendance—professional networking—we have thought of that, too. Please make use of our networking lounge both for side conversations you decide to arrange and for spontaneous chats, just as you would in Vienna. It is open throughout the event.

I think all of us together will learn a fair bit about how best to engage with and enjoy and online Drucker Forum. Without doubt, we will learn a lot about leadership. I wish all of us a rewarding experience.

Richard Straub

Founder and President

Global Peter Drucker Forum

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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Or, just as bad, you’ll trust your instincts on a matter where a straightforward data analysis would expose how off-base your understanding is.

Mistakes like this happen all the time, because different kinds of human effort require different kinds of knowledge. This is no novel claim of our own — it’s only what Aristotle explained more than 2,000 years ago. He outlined distinct types of knowledge required to solve problems in three realms. Techne was craft knowledge: learning to use tools and methods to create something. Episteme was scientific knowledge: uncovering the laws of nature and other inviolable facts that, however poorly understood they might be at the moment, “cannot be other than they are.” Phronesis was akin to ethical judgment: the perspective-taking and wisdom required to make decisions when competing values are in play — when the answer is not absolute, multiple options are possible, and things can be other than what they are. If you’re a farmer designing an irrigation system or a software engineer implementing an agile process, you’re in the techne realm. If you’re an astronomer wondering why galaxies rotate the way they do, you’re in the epistemic realm. If you’re a policymaker deciding how to allocate limited funds, you’re in the phronesis realm.

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.
#DruckerForum

The reason that Aristotle bothered to outline these three kinds of knowledge is that they require different styles of thinking—the people toiling in each of these realms tend toward habits of mind that serve them well, and distinguish them from the others. Aristotle’s point was that, if you have a phronetic problem to solve, don’t send an epistemic thinker.

But imagine that you’re a leader of a large enterprise that has challenges cropping up regularly in all three of these realms. There are plenty of techne problems as you work to adopt effective methods and tools in your operations. You also have epistemic challenges; anything you approach as an optimization problem (like your marketing mix or your manufacturing scheduling) assumes there is one absolutely right answer out there. And firmly in the realm of phronesis would be anything you label a “strategic” matter — decisions on mergers and new product launches, for example, involving trade-offs and recognizing that the future holds various possibilities. As a leader presiding over such a multifaceted organization, it’s a big part of your job to make sure the right kinds of thinking are being marshaled to make those different kinds of decisions. This means that you personally need to have some facility with all the different modes of thinking — at least enough to recognize which one is the best fit to a given problem, and which people are particularly adept at it.

That’s all the more true for the largest leadership challenges in the modern world, those that are scoped so broadly and are so complex that all these kinds of thinking are called for by one problem, in one facet or another. Think, for example, of a corporation facing a liquidity crisis. Its leaders need to marshal epistemic expertise to discover the optimal resolution of loan covenants, issuance restrictions, and complex financial instruments — and the phronetic judgment of where short-term cuts will do least damage in the long run.

This brings us to the Covid-19 global pandemic and the challenges it has presented to leaders at all levels — in global agencies, national and local governments, and businesses large and small. To be sure, almost all of the world was blindsided by this catastrophe and early missteps were unavoidable, particularly given misinformation at the outset. Still, it has now been 10 months since patient zero. How can the devastation still be running so rampant — and have segued, unchecked, from deadly disease to economic disaster?

Our diagnosis, not as medical experts but as students of leadership, is that many leaders stumbled in the fundamental step of determining the nature of the challenge they faced and identifying the different kinds of thinking that had to be brought to bear on it at different points.

In the early weeks of 2020, Covid-19 presented itself as a scientific problem, firmly in the epistemic realm. It immediately raised the kinds of questions to which absolute right answers can be found, given enough data and processing power: What kind of virus is it? Where did it come from? How does transmission of it happen? What are the characteristics of the worst-affected people? What therapies do most to help? And that immediate framing of the problem caused leaders — and the people they influence — to put enormous weight on the guidance of epistemic thinkers: namely, scientists. (If one phrase should go down in history as the mantra of 2020, it is “follow the science.”)

In the U.K., for example, this translated to making decisions based on a model produced by researchers at Imperial College. The model used data collected to date to predict how the virus would spread in weeks to come (quite inaccurately, unfortunately). At the frequent meetings of the Scientific Advisory Group for Emergencies there was one government official in attendance, and early on, he tried to inject some practical and political considerations into the deliberations. He was promptly put in his place: He was only there to observe. Indeed, members expressed shock that someone from the world of hashing out policy would try to have influence on “what is supposed to be an impartial scientific process.”

But the reality was that, while scientific discovery was an absolutely necessary component of the response, it wasn’t sufficient, because what was happening at the same time was an escalation of the situation as a social crisis. Very quickly, needs arose for tough thinking about trade-offs — the kind of political deliberation that considers multiple dimensions and is informed by different perspectives (Aristotle’s phronetic thinking). Societies and organizations desperately needed reliable processes for arriving at acceptable balances between factors of human well-being too dissimilar to plug into neat equations. Pandemic response was not, as it turned out, a get-the-data-and-crunch-the-numbers challenge — but since it had been cast so firmly as that at the outset, it remained (and remains) centered in that realm. As a result, leaders were slow to begin addressing these societal challenges.

What was the alternative? What should a great leader do in such a crisis? We believe that the right approach with the Covid-19 pandemic would have been to draw on all the relevant, epistemic knowledge of epidemiologists, virologists, pathologists, pharmacologists, and more — but to ensure that the scope of the problem was understood as broader than their focus. The tendency of the epistemic habit of mind is to go narrow, into pockets of science where it is possible to arrive at absolute, can’t-be-otherwise answers. The right approach would have been to factor those contributions into what was understood from the outset to be a sprawling, complex system of a challenge that would also call on holistic thinking and values-balancing decisions. If leaders had from the outset framed the pandemic as a crisis that would demand the highest level of political and ethical judgment, and not just scientific data and discovery, then decision-makers at all levels would not have found themselves so paralyzed — regarding, for example, mask mandates, prohibitions on large gatherings, business closures and re-openings, and nursing home policies — when testing results proved so challenging to collect, compile, and compare.

We admit we are painting with a broad brush here, undoubtedly some leaders balanced competing priorities and managed the calamities of 2020 more effectively than others. Our objective here is not to point fingers but simply to use the extremely prominent example of Covid-19 to underscore a fundamental but under-appreciated responsibility of leadership.

Part of your job as a leader is to frame the problems you want people to apply their energies to solving. That framing begins with comprehending the nature of a problem, and communicating the way in which it should be approached. Calling for everyone to weigh in with their opinions on a problem that is really a matter of data analysis is a recipe for disaster.  And insisting on “following the science” when the science cannot take you nearly far enough is a way to paralyze and frustrate people beyond measure.

This ability to size up a situation and the kinds of knowledge it calls for is a skill you can develop with deliberate practice, but the essential first step is simply to appreciate that those different kinds of knowledge exist, and that it’s your responsibility to recognize which ones are called for when. Aristotle’s efforts notwithstanding, most leaders haven’t thought much about realms of knowledge and what problems they can solve. Expect that to change as enterprises, and societies, take on increasingly complex and large-scale challenges — and leaders are increasingly judged on the thinking that goes into them.

This article was originally published at HBR.

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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It is high time to rethink our parameters for dealing with the pandemic. What we need are leaders with judgment and common sense.

We are currently seeing an alarming new twist in the Covid narrative: while at the start of the pandemic the aim was to prevent our healthcare systems from collapsing, the goal now seems to be to stop anyone at all becoming ill. But the situation today is in no way comparable to that of spring. It is true that in much of Europe infections are again on the rise. Yet on the whole rising case numbers are having little effect on hospital bed occupancy or even on intensive care units. We are in a new phase of the pandemic, not a repeat of the first one. For now the collapse of our health systems is not imminent, nor, according to experts, is one anticipated.

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.
#DruckerForum

The reasons for this are multifactorial: on the one hand, a growing proportion of those affected in the new wave consists of the young, who mainly present with mild symptoms; on the other, better therapies are becoming available to treat more severe cases. Last but not least, it is being suggested in some quarters that as the virus becomes more infectious, it is also weakening in potency.   

Meanwhile, the collapse that we are actually suffering is that of the economy. According to OECD forecasts, Europe can expect to feel the greatest blow to its prosperity since the second world war, in which the first wave with its lockdown is set to leave much deeper traces (France and the UK more than -11%, Germany -6.8%, Austria -6.2%) than the second, which in turn may be morphing into something more like a “permanent wave”. This means that even if the health crisis were to worsen again, it would have to be weighed against the social and economic consequences. For one thing has become clear: even if a vaccine is forthcoming, it will not magic the problems away at a stroke. 

What we need from leadership today is clear thinking, sound judgment and common sense. That means being able to take the best insights from different kinds of expertise and blend them into decisions that are balanced and above all pragmatic, as Roger Martin, Julia Kirby and I outline in our HBR article on the approaches leaders should bring to different types of problem. Those who focus on counting infections while turning a blind eye to actual hospital admissions and deaths, let alone the enormous collateral damage currently being inflicted on the economy and society as a whole, are committing errors of thinking that do society a grave disservice. “If your only tool is a hammer, every problem looks like a nail”. The authorship of this quote is disputed, but no one can doubt that in the current situation it hits the nail squarely on the head. It is high time to bring a different set of tools to the task of dealing with the pandemic.

About the Author:
Richard Straub is Founder and President of the Global Peter Drucker Forum. The 2020 Forum will take place on October 29 & 30 in the Vienna Hofburg Palace with the general theme: Leadership Everywhere – A Fresh Perspective on Management.

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

Crisis always shifts people’s attention abruptly to the quality of their leaders. We are seeing this now, as the appalling spread of the COVID-19 virus and the alarming collapse of economicactivity worldwide have people in all quarters looking to leaders for guidance—and often being left far from reassured by what they see.

Why do people give so much more attention to their anointed leaders in such moments? Leadership pundits usually explain that when they are panicked, people grasp for certain things: a model of resolute confidence to calm their nerves, a clear thinker to outline the right course of action, a decisive actor who wastes no time dithering. All this is true.

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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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But what many students of leadership miss is that people also know that any crisis is a time of uncertainty and ambiguity, when big changes are afoot. They suspect that rules will change, priorities be reordered, and that some of those who used to be up will find themselves down. And they want leaders who can be trusted to protect their interests, not advance a pet agenda of the leader’s own or their cronies. They want leadership focused on practical solutions – not motivated by ideology, let alone political considerations.

The fact that so many leaders in these past weeks have come up short on all these requirements underscores that our institutions must focus more on improving how they are led – just as they have, over the past century, concentrated on how efficiently they are managed. The two functions are not synonymous. In any enterprise, good management means seeing that work is done in the best way to achieve an organization’s objectives. But figuring out what those objectives should be and orchestrating the capacity for collective performance with the right players in place is the province of leadership. As the classic expression goes, management is doing things right—leadership is doing the right things.

Figuring out the right things to do has always been difficult because it involves judgment and strategic vision. It also requires trade-offs. But the challenge has become much greater given the modern world’s unprecedented level of connectivity and interdependence, and hence complexity. Across the past 200 years, we have seen the formation of a vast, man-made network of organizations and institutions. Equally, the notion of being stewards of our natural ecology, our environment, has made its way to the top of the agenda of companies, public sector bodies and governments during the last decades. However, we have terribly ignored the challenges that the new man-made environment of myriads of interconnected companies, consumers, investors, public sector institutions, governments and NGOs poses. They are all part of a web that Peter Drucker called the new Social Ecology. Just like natural ecosystems, our social ecology needs care, maintenance and diligent stewardship.

In this perspective, while just-in-time globalized supply chains can justly be celebrated as a great advance in management practice, the resulting dramatic increase in vulnerability must be part of the leadership equation. In the same way, the globally integrated virtual enterprise with its company rolesand functions distributed across the globe can be hailed as a great organization innovation that frees us from the constraints of time and space. Yet, again in a leadership perspective, the organizational gain has to be weighed against the social impact of large-scale displacement of jobs and the damage done to trust in corporate leadership both internally and in society at large. Managing investment portfolios through artificial intelligence and automated algorithmic trading processes that amplify shocks to the system and accelerate downward spirals is another example of the culpable abdication of leadership responsibility to digital systems – whatever their benefits in terms of productivity and efficiency.

At the same time, governments and public sector bodies seeking to impose sweeping restructuring on whole sectors, such as the automotive industry in Europe, should be forcefully reminded of the huge costs of such top-down transformations in terms of social burden and destruction of economic value. They lose sight of the fact that the social ecology is made up of evolutionary systems that cannot be transformed by government fiat without creating unintended consequences that may be more damaging than the ill they are intended to cure. The German “Energiewende”, and the stifling regulatory micromanagement that has become the norm are examples of this failure of leadership vision. Responsible leadership needs to embrace both the preservation of the natural environment and the need to keep modern society functioning by nurturing the social ecology of existing value-creating organizations and institutions.

If all this sounds like an overdramatic wakeup call, I make no apology. The Covid-19 shock hits us at a time when our economic, social and political fabric are already significantly stretched. As The Economist’s Adrian Wooldridge reminded us at the 10th Global Peter Drucker Forum in 2018, we are living an acute crisis of leadership. This crisis is massively amplified today by the latest developments. In the midst of the financial crash in 2008, Rahm Emanuel, then chief of staff to President Obama, made a memorable observation to an interviewer: “You never want a serious crisis to go to waste.” His meaningwas that, because people are unusually compliant when rattled, leaders would be foolish not to use the license granted to them to execute real change. The phrase is often repeated as the quintessential cynical response to a situation that can be exploited to push what would, in normal times, be an unpalatable agenda. Yet odd as it may sound, even today’s unprecedented crisis is a real opportunity for leaders to rethink their outdated assumptions.

In terms of the leadership agenda, the first essential is clearly to mobilize the leaders of all organizations to live up to their responsibilities – initially in the fire-fighting phase that we are currently traversing. The more power leaders wield, the more they must remember the crucial importance of their role in serving a bigger cause and strengthening trust with their communities and society as a whole. We think here particularly of those who have most benefited from the long stock- market boom: investors who largely remain hidden behind anonymous trading systems, and selfdealing boards/executives at Dow Jones corporations who have made propping up share prices with massive stock buybacks a standard practice, thereby collaborating, deliberately or not, in the inflation of the larger stockmarket bubble that has just burst.

This fortunate minority need to remember that they are not investing in shares but in real people, for whose livelihoods, and lives, they bear a responsibility. To just run away is not an acceptable response, either ethically or economically. As leaders and stewards, they are called on to take a longterm perspective and demonstrate this by their actions. Warren Buffet should be considered a role model in this respect. Secondly, surmounting this crisis in the coming months will require us to reassess the importance of leadership for the remainder of the 21st century. It can only be based on fundamental human values, with human dignity at the center, deep understanding of reality, constant openness to learning from that reality, and a profoundly pragmatic mindset that finally demands us to shed the ideological blinkers that we have inherited from the last two centuries.

Charles Handy had it absolutely right. Things need management. People need leadership – and it is dangerous to get it the other way round. Our society needs leadership to imaginesolutions without which – make no mistake – our social cohesion is at risk. To this end, the high calling for leadership in the 21st century is nothing less than to unchain the potential of human ingenuity, creativity and eagerness to engage, and thus make fully effective the most important resource on the planet. We need nothing less. Richard Straub is Founder and President of the Global Peter Drucker Forum. The 2020 Forum will take place on October 29 & 30 in the Vienna Hofburg Palace with the general theme: Leadership Everywhere – A Fresh Perspective on Management.

About the Author:

Richard Straub is Founder and President of the Global Peter Drucker Forum. The 2020 Forum will take place on October 29 & 30 in the Vienna Hofburg Palace with the general theme: Leadership Everywhere – A Fresh Perspective on Management.

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