What kinds of companies have bounced back better from the pandemic years? New evidence shows it’s the ones who had already invested time and energy in building their capacities for innovation.

Bill Fischer Senior Lecturer at the Sloan School of Management, at MIT, and Emeritus Professor of Innovation Management, IMD

John Hagel III Faculty member, Singularity University & Member Board of Trustees, Santa Fe Institute; Founder of Beyond On Edge, LLC 

Tim Brown Chair of IDEO, Vice Chair of the kyu Collective

Gilma Teodora Gylytė Architect; Co-founder, DO ARCHITECTS

Radoslaw Kedzia Senior Vice President of Huawei European Region

Attitudes to chaos are conflicted. It’s no secret that our world is dynamic and non-linear and only in equilibrium by (temporary) accident. As Huawei’s Rado Kedzia put it, entropy means that everything in the universe tends to chaos –  except organizations, which are our attempt to impose order on it, at least momentarily. So we ignore chaos as long as possible  –”we don’t teach it at business schools, and it’s so far from normalcy that we treat it as something to stay clear of,”  noted session moderator Bill Fischer of MIT. 

But that is no longer possible.Today’s chaos seems more immediate, more chaotic. Why – and how can organizations more constructively approach it?

From a compelling interactive session, a number of insights emerged. IDEO’s Tim Brown suggested that it was the pandemic – with its intimations of mortality and sudden upending of decades of work routine – that marked the turning point. The kneejerk response to “bounce back” clearly no longer cut it: it was only by “bouncing forward” (in the phrase of John Hagel of Singularity University) to find new ways to evolve that organizations could genuinely become fitter to face a more turbulent future.

Hagel strikingly argued that we live at a moment of “exponentially expanding opportunity” to create more value with less resource faster than ever before. But not if as all too often we’re driven by fear. So in times of chaos and change, the first imperative was to engage with emotions above all, cultivating those that motivate creativity and curiosity rather than withdrawal and fear. Then, the emphasis should be on developing the general capabilities of collaboration and reflection (as opposed to narrower skills) that facilitate learning based on creating new knowledge rather than transferring what we know already – “and that occurs not in a training room but by acting together with others in the workplace.” He pinpointed the need to go beyond engagement to unleash “the passion of the explorer” – the urge to actively actively seek out change that will lead to positive impact.

Brown took up the “bounce forward” theme by emphasizing the importance of a creative mindset– “An organizational creative mindset can only happen if you’ve got individual creative mindsets, and organizational resilience can only happen if you’ve got individual resilience. The two are not the same – one builds from the other”. A creative mindset leads to more connections and collaboration, building open-mindedness and “creative confidence” – an idea that chimed with Hagel’s set of reflective capabilities. The organization can reciprocate through leadership “that asks bigger questions than have been asked before”, that fosters diversity and that creates the climate of psychological safety that featured prominently in other panels at the Forum.

Psychological safety also figured large in the exuberant presentation of Lithuanian architect Gilma Gylytė, who demonstrated the remarkable effects of apparently simple alterations to the built environment. She described what happened when architects opened up the kitchen and eating area in a Vilnius kindergarten. Previously (and systematically in schools all over what was Soviet dominated central and eastern Europe), cooks worked in windowless kitchens cut off from interaction with the kids who ate their invisibly produced food. As expected, the children loved the result – but the major effect was on the cooks who responded to the spotlight by becoming “cooking stars not only for the children and the teachers, but for the whole community” as they began catering for birthday parties and the like. Having taken 33 years after independence to fully grasp the effect of creating an environment reflecting democratic rather than Soviet values, architects are eagerly reproducing it elsewhere – transforming bleak boulevards by creating spaces for street markets and other human gatherings, and perhaps even more radically, experimenting with ideas to make corporate offices so attractive that employees prefer to work there than at home. Whatever next?

Reflecting on these ideas, Huawei’s Kedzia noted that his company had learned from experience of navigating external surprise the importance of reinforcing broad capabilities rather than having to reinvent the wheel with every change of circumstance, while deeply exploring new developments was more serious and challenging but also satisfying than waiting for serendipity or accidental discovery. “We focus on our core values, why we exist, what is our strong point”, he said. One core value is being customer centric; another is perseverance – ”’we don’t give up easily on a daily basis, but nor do we shy away from difficult situations. Anyone can do easy. I tell employees you have to feel a bit of challenge and pain to feel the satisfaction that you can overcome these things.’ Difficulties, he said, help you get clear about purpose, what matters and what doesn’t, leaving the organization fitter and more resilient than rivals who have had it easier, and determined to outlast both them and the typical 30-year corporate life cycle.

Chaos emerged from a rich discussion as something neither to be shunned nor feared. On the contrary, if treated with respect, like a judoka exploiting an opponent’s force, it can be a friend and an asset to creativity, Brown pointed out. As Kedzia identified, chaos is the acid test of a company’s purpose and values – “what’s left to hang on to when the lights go out”, as it was put elsewhere at the Forum. As with the pandemic, which “unfroze” work arrangements unquestioned for decades, chaos can crack open old certainties for creative thinkers to exploit. In a later panel, a participant described how he was appointed CEO of a company paralyzed by sudden surprise precisely because he knew nothing about the industry’s conventions, shareholders gambling, correctly, that someone untrammeled by preconceptions was more likely to come up with a fresh new approach. But you ignore it at your peril –  use chaos creatively to come out ahead, or risk finding the ship’s lights fading in the distance when the waves recede and you finally come up for air.

About the author:

Simon Caulkin is senior editor, Global Peter Drucker Forum

At this year’s 15th Global Peter Drucker Forum, the Huawei Masterclass had as its guiding principle the idea of enabling the growth and innovation of startups. In his opening remarks, Gavin Allen, editor-in-chief of Huawei, said that SMEs are the engine that keeps Europe’s economy running and new ideas coming to fruition. A prosperous economy in Europe depends on its millions of new businesses. 

According to studies, a significant portion of SMEs still lack essential components of their ICT infrastructure, putting them in a digitally immature state. Huawei pledged in 2022 to build a start-up ecosystem around the world. In only three years, they aimed to back 10,000 promising new businesses. Speaking at the event, Fen Zhuang—Director of Global Industry Development at Huawei Cloud Global Marketing and Sales Service—introduced the attendees to the Huawei Cloud Start-up Program. Zhuang spoke about how the start-up community at Huawei is leading in this age of disruption by sharing knowledge and adding to the international conversation around creative resilience. 

Michael Anthony of AI4Privacy, Juan Romero of PhotoILike, Thamio Singou of Lean-Link, and Charles Dickson of Wemeetz were the leaders of four start-ups that participated in the Huawei program. They shed light on topics like cloud solutions and entrepreneurial leadership. 

As the room seemed to agree that digital maturity was a key ingredient in becoming a unicorn, the tables were turned by Carla Arellano, Partner at Greyhound Capital, and Curt Carlson, Distinguished Executive in Residence at Worcester Polytechnic Institute.

Exceptional leaders needed

Carla is an entrepreneur with a knack for solving problems and a history of building successful businesses. She is fascinated by the power of collaboration between individuals and organizations to bring about long-term growth and industry revolutions. She firmly believes that in this age of discontinuity, no amount of initial public offerings (IPOs) can guarantee a startup’s success; rather, only exceptional leaders can devise and implement daring plans by mastering the art of people and organization development. Startups that go on to become unicorns often have a trait in common: they are the ones that hire leaders early on and place a premium on making this process a profession. Spending time learning the ins and outs of the company’s structure, including who does what and how important people pursue certain goals, is crucial, according to her, an investment partner at a growth equity fund. Investors like us put money into specific individuals rather than businesses. The individuals you choose to work for you and the way you set up shop are the deciding factors. On the path to becoming a unicorn, how you approach different roles, who you hire for what, how you hire great people, and how you create this combination of many individuals — matters a lot. While Carla is correct in saying that there is no magic formula for success, her team’s analysis of 350 FinTech companies over the past 20 years reveals two major factors that contribute to a startup’s chances of success: an organizational superpower and CEOs who put an early emphasis on attracting leaders. Organizational superpowers are different from start-ups’ product or technological superpowers. That superpower can be used to create a flywheel. From the way they hire new employees to the way they introduce new products/services, every aspect of a start-up’s management philosophy is important. Get a head start on hiring leaders and do it professionally. Hiring and recruiting C-suite executives is essential for investors who wish to witness start-ups expand at an exponential rate. 

Internal and external customers

According to Curt’s formula, superpowers pay attention to both internal and external customers, and they also create value. His work with managers at both established companies and fledgling businesses led him to believe that a systematic approach to creating value is within reach. To build resilient companies, it is essential to have a clear understanding of each employee’s role and how they contribute. Creating value entails meeting a critical need for the end-user in a way that is superior to competing solutions while simultaneously satisfying the requirements of all parties involved. Value delivery is the only goal of a well-designed methodology that identifies and solves end-user needs while differentiating them from their problems. From this perspective, innovation is all about creating new value for society’s end-users while maintaining a sustainable business model. This means that the offering and underlying viability model must take a novel, persuasive, and defendable strategy to meet a significant unmet market and end-user needs while also outperforming the competition and all other options in terms of benefits and costs by a factor of two to ten. A start-up can go on the unicorn track faster with the help of the NABC Value Proposition methodology, which helps to methodically develop the criteria for hiring a brilliant CEO.

Peter Drucker once said that a company’s market success comes from its management thinking, and Wolfgang Lassl, an Executive Advisor to Peter Drucker Society, echoed this sentiment. Someone with the ability to anticipate the unexpected, who innovates now so they are prepared for the future, and who does it methodically is an entrepreneur. Only then can the founder of the startup understand the need to be emotionally distant from his creation and recognize the need to hire someone to cover a leadership gap. 

Given the present situation, we need to train leaders to be open to surprise and challenge, as well as able to develop new scripts. Leaders need the skills to successfully navigate the unknown as entrepreneurs, to maintain business continuity and refresh their business models.

About the author:

Sylwia Sysko-Romańczuk is professor of innovation and entrepreneurship at Warsaw University of Technology with research interests in value-driven growth in the digital and networked economy.

In 2009, the first Annual Drucker Forum was held to mark the centenary of Peter Drucker, the “father of modern management.” Coincidentally, that same year, the world faced the most severe worldwide economic crisis and recession in 80 years. Since then, we have witnessed an accelerated pace of change and experienced many unexpected challenges. The past few years have been especially difficult as we dealt with COVID-19, geopolitical disruptions affecting the global economy, very discernible effects of climate change, the polarization of societies, and the rise of artificial intelligence.

Drucker once said, “A person can perform only from strength.” Most organizations know their strengths, having nurtured and strengthened them through sound corporate strategy work and execution. But will these strengths protect us in times of disruptions, when the rules of the game can change very fast and drastically? Will they enable us to weather the storm, navigate through the needed readjustments, and leave us stronger than before, even if not fully unscathed?

The Experience of Resilience

My personal interest in resilience was sparked by the 2008 global financial crisis and the ensuing great recession. At the time, the organization I worked for relied heavily on clients’ so-called “discretionary budgets”, and everyone expected us to be among the first casualties. Instead, we fared well, our growth only temporarily affected by a few points before rebounding strongly and outperforming the market in the subsequent years. Financial analysts were somewhat flabbergasted and kept asking us why and how we did it. The truth is, we did not really know why! As a leadership team, we often laughed about it.

In trying to find the root causes of this unexpected resilience, I looked back at my career and reflected on my past experiences. I remembered the first time I was asked to run a company. It was a European publishing company massively disrupted by the digitalization and globalization of its segment. The main shareholder had told me that the business model was collapsing, and that at this point, they preferred to pick someone as CEO who knew very little about anything, hoping they would figure out what to do. I was barely 30 years old and thought I had nothing to lose. Indeed, I had to “figure it out”. We stayed true to the original mission of the company, kept and even reinforced the premium positioning, but changed everything else in a massive and largely improvised digital transformation. As it turned out, we succeeded much faster than expected, giving another decade of growth to the company.

Still trying to find the root causes of corporate resilience, I also read a few useful books, among which “Resilience” by Andrew Zolli and “Anti-Fragile” by Nassim Taleb influenced me the most. Then, 10 years after the great recession, Covid happened, and once again, we had to figure it out. Facing this “black swan” event that turned into a fascinating real-life social experiment on a global scale, the business I was running then, this time in the US, not only did rather well during the months of lockdown but also gained market share, emerged strong, and significantly outperformed the market in the subsequent years. But the aha moment I had during this period, what truly struck me, was that this time I could clearly see what had made us so resilient. And the disturbing fact was that what had made us so resilient, were the things that we had, in fact, tried to tame for years as a leadership team: the propensity of everyone, in this very entrepreneurial company, to do more or less whatever they enjoyed doing, over abiding by the corporate strategy; the complexity of our offer; and the relative fragmentation of our organization.

That is when an almost existential question started to emerge in my mind: Does the commonly accepted way of developing and executing a strategy, although making us more successful, also make us more fragile?

The Tension between Corporate Strategy and Corporate Resilience

If you think about it, corporate strategy is about making choices: where to play, and where not to play; how to win, based on expressing a relevant and differentiated value proposition; how to build capabilities to execute flawlessly; and how to reallocate resources effectively. It often comes together with an execution plan that emphasizes the need to consolidate structures, streamline the supply chain, reduce the number of product lines, eliminate cost redundancies, and sometimes even reduce the number of clients to focus on the largest and most loyal ones. And, although this is rarely the favorite topic for CEOs, risks are thoroughly assessed, sometimes driven by regulatory requirements.

The keywords are: pick your lane and scale.

As the strategy is deployed, a lot of effort is also put into “alignment.” The goal is to have the entire organization support the strategy and avoid spending time and resources on anything else.

Let’s recognize it: A well-designed and properly executed strategy usually works, at least as long as the environment is relatively well-known.

But here’s the problem: When we observe the most resilient systems around us, they do not seem to abide by all these commonly accepted good practices of strategy.

Think about ecosystems, including biosystems. Or, to refer to human creations, think about groups that are very difficult to eradicate despite the deployment of considerable resources, such as criminal or terrorist organizations. These most resilient systems seem to share a few things in common. They are complex, sometimes incredibly so, and diverse. Their components are interdependent but are distributed and balance each other. They do not seem to follow a conscious plan. Rather, they constantly adapt.

Then comes the real question for CEOs who are focused on the long-term of the organization they lead, who are obsessed with maximizing its chances to thrive long after their own tenure: Are there practical ways to combine the strategy imperative and the need to make their company resilient, so it can actually gain in the future from disruptions whose precise nature cannot be predicted, which might upset an otherwise very successful strategy?

Exploring the Search for Excellence in Both Strategy and Resilience

Combining a sound corporate strategy and the intentional development of an organization’s resilience, is more an art than a science. Maybe scholars will help make it one. Meanwhile, I can only share some ideas to explore, based on thoughts I borrowed with pride from others, on discussions with peers, and on my personal experience, both successes and failures, of decades as a “practitioner-CEO”.

Before anything else, we need to recognize that developing resilience is not just about making corporate strategy more sophisticated. It is also about multiple other things you can do as a CEO, such as:

• Fostering the right culture, by getting the organization used to change and increasing its psychological readiness for disruption, by being data-driven – that is, building data capabilities, but also the ability of the organization to accept what the data says, by nurturing feelings of belonging and mutual trust, including with suppliers and clients, or by ensuring diversity to maximize the chances that creative solutions emerge when the time comes.

• Designing the right structure, with the ideal goal to make it both distributed, so the various groups can operate with a lot of autonomy when facing unexpected situations, and clustered, so they have some scale efficiency and diversity.

• Developing the right kind of leaders, who are focused on the long-term, who have the ability to be great connectors between relatively independent elements, who are focused on outcomes rather than on outputs, who are themselves resilient individuals through their attention to mindfulness and selflessness, who are curious, culturally adaptable and constantly learning.

But when it comes to the corporate strategy itself, there are also specific steps a CEO can take.

Firstly, when designing a strategy, I believe it is better to resist the temptation of over-simplifying. What we may gain short term, will in turn increase our fragility. Leaving some room for maneuvering will be essential when the rules of the game suddenly change.

Second, when making bets, the asymmetry between risk and rewards must be thoroughly reflected upon. The organization often pushes for big bets that have big upsides. But what if the downside is massive? As the CEO, our role is to avoid these bets where we bank the future of the company we lead and are responsible for, if there is a reasonable chance that a failure will be lethal. On the contrary, multiplying small bets that have significant upside but are all recoverable from in case of failure, not only creates options that may prove very useful when unforeseen events occur, but also develop, in case of failure, “muscle memory” to the organization. It makes it more resilient no matter what.

Thirdly, it is essential that the resource allocation make room for innovation and be very intentional about it. I personally like to apply, at least directionally, the 70/20/10 principle: 70% of resources allocated to running existing products and services. 20% to developing and taking to market innovation that stays in the “known” domain for the organization. And 10% to invest in the “unknown”. It is very difficult to do this. In all companies I have run in my career, the starting point was much more in the 90/8/2 range. But maybe the journey is more important than the destination. Being intentional about innovation is a critical move to develop resilience. The unknown may not deliver much for long periods of time. And you may not understand how it will. But maybe it will save your organization when the unpredictable will occur.

Finally, in the world of project management, which is, after all, what we focus on at the Project Management Institute, the last decades have seen the constant rise and increased pervasiveness of Agile methodologies. They have progressively blended with predictive approaches to form the hybrid approaches that PMI most often favors, and to the broader emphasis on corporate agility. I believe the principles of corporate agility should apply to corporate strategy to preserve corporate resilience, while at the same time ensuring a rigorous and methodological approach to corporate strategy: Operate with incrementality or iteration, get a constant feedback loop, favor servant leadership. 

And even more importantly, combine fluidity when it comes to structures and plans, and rigidity when it comes to purpose and values. When the light suddenly switches off because of a fundamental disruption or a black swan event, this North Star, made of why your organization exists and how your teams should behave in any circumstances, will still be there. Your teams won’t require a plan nor even a precise direction to find their way back, while other organizations will collapse under the disruption. And you will emerge stronger than your competitors when the light switches back on.

Building resilience is not about dumping corporate strategy because ‘nothing is predictable.’ And nothing will ever guarantee that your organization will survive anything that may happen. It is about increasing the odds that you will survive if it happens. And being confident that when it happens, you will do better than your competition, which should even make you hope that disruption happens.

And in any case, building resilience in your strategy, culture, structure and leadership principles will ensure that whatever form it will take, the very purpose of the organization you lead, and what it deeply believes in, will carry on and thrive.

About the Author: 

Pierre Le Manh is President and CEO of Project Management Institute (PMI)

Walter Isaacson’s near-700-page biography of Elon Musk covers a lot of ground. We get many stories of the remarkable innovator, how he revolutionized at least two industries, automobiles and rockets, and his controversial purchase and overhaul of Twitter. Great reading – but what can a leader learn from Isaacson’s account?

That’s a key question because, in the end, the author concludes that Musk – a larger-than-life entrepreneur, a freak of nature in his willingness to accept, even seek out, extraordinary risk – is a complete package: you can’t get the relentless, brilliant innovation without the unfiltered, insensitive, and sometimes plain awful treatment of people around him.

Yet, although there is much to learn from Musk’s innovation record, his abrasive personality is not a necessary condition for success. When my team and I researched the factors for perpetual innovation from 2006 to 2022, Tesla was indeed among the best, but other firms had elements of what Tesla did.  You don’t have to emulate Musk’s abrasiveness to reap the benefits of his example: a move of 20 to 30% in his direction can accomplish a great amount.

Existential Purpose

Isaacson effectively describes Musk’s maniacal commitment to saving civilization through electrification, space travel, and other technologies and how these emerged from his childhood fascination with science fiction and video games.  Trumping love of money or status this commitment enables him to embrace extraordinary risk, even suing his primary customer at one point.

But omitted from the book are the crucial second-order effects of his commitments, notably the galvanizing effects on people around him. For all his divisiveness on social media, Musk has successfully won over talented people to his goals, creating innovative, profitable companies along the way. The bold pursuit of significant challenges also helps.

Even if most managers are less obsessional than Musk, they can learn from his pursuit of an existential purpose that clarifies strategic decisions and attracts highly engaged colleagues to the cause.  Most corporate purpose statements are vague or feel-good window dressing, with little actual traction in the organization. Either find something with an edge, or don’t bother.

Startup Mindset

Isaacson notes Musk’s need for drama, especially after success in overcoming an obstacle.  He would “yank the alarm bells and force a fire drill,…find something to turn into a crisis.”  It’s suggested that that’s a problem, but it’s actually common in serial entrepreneurs, which is why they move on once they succeed (or fail) with a startup.  Leaders aren’t usually entrepreneurs but can still gain a lot from a startup mindset.

Contrary to popular belief, startups rarely depend on testing and succeeding with a specific product. Instead, they attack a market segment with an idea and quickly pivot as they learn about both. As Isaacson shows, Musk didn’t set out to build a rocket company – he just wanted to get NASA and the existing industry moving toward Mars. Tesla’s founders didn’t target mainstream passenger automobiles until Musk arrived and made the crucial decision to pursue the luxury market. That willingness to pivot is vital, but all too rare.

Big companies can do something similar, not just with Agile’s minimum viable product approach, but by showing openness and flexibility toward the market. It just takes effort and focus. As Amazon’s Jeff Bezos told shareholders in 2016, “We can have the scope and capabilities of a large company and the spirit and heart of a small one. But we must choose it.”

Managing Tempo

Where can ordinary leaders get that effort and focus? Here’s an element missing from the biography and probably from Musk’s own career. Amid the constant innovation and crises, it’s easy to forget that even at Tesla and SpaceX, a moderate amount of the work is straightforward. Engineers and designers must make the innovations practical and commercial with all the little adjustments that customers only notice when they’re not there. The slower pace is also a good time to begin deliberating big changes.

For most humans and organizations, such work is restorative, allowing normal office hours and work-life balance. Musk prefers “hard-core” dedication that squeezes out non-work ties, epitomized by the pillow he keeps under his desk for all-nighters. In recent years, his companies have lost many talented people who can’t keep up with his extraordinary stamina and willingness to forgo ordinary human relationships, only partially offset by new recruits attracted by his charismatic commitments.

Instead of continual hard-core, other organizations can adjust their tempo to save up energy for the tough periods. The corporate default is for everything to move at the same pace, but perpetual innovators alternate between periods of frenetic activity and quiet times of supportive work. During the latter they also do something different: they stay alert, looking for opportunities and threats.

To do all that, managers must fight relentlessly against creeping bureaucracy that focuses people’s attention internally during slow periods and limits their freedom to maneuver in the fast ones. Microsoft took off in the late 2010s only after CEO Satya Nadella removed many bureaucratic structures that had built up over time.

Radical Collaboration

Isaacson mentions Musk’s systematic willingness to challenge requirements but neglects how that plays out within organizations. His companies operate with a different sense of hierarchy. To solve tough problems, Musk tells employees to ask for help from anyone with the crucial expertise, irrespective of rank. No matter how outlandish the request, dismissing someone with what Musk calls an “unproductive no” can be a firing offense.

Ordinary leaders can similarly loosen hierarchies by resisting the pull of rank and focusing on solving the problem, not structures and status to be respected.

Besides these four areas, Isaacson’s engaging story falls short in showing the broader effects of Musk’s potent mix of generosity, ferocity, and courage. It’s not just that he combines enormous energy, engineering brilliance, and a high tolerance of risk – he puts those gifts to highly productive use through effective leadership.

There is no reason why ordinary leaders can’t learn from his examples to make their organizations more innovative. They might not revolutionize industries, but they’ll do themselves and society a favor by creating value in these disruptive times. 

Elon Musk by Walter Isaacson Simon & Schuster, 688 pages

About the Author: 

Behnam Tabrizi has taught “Leading Organizational Transformation” at Stanford University and its executive programs for over 25 years and consulted on innovative transformational initiatives with thousands of CEOs and leaders. His latest WSJ bestseller book is Going on Offense: A Leader’s Playbook for Perpetual Innovation (IdeaPress Publishing). 

Well might the organisers of this year’s Global Peter Drucker Forum have invoked “an age of discontinuity” in the conference title. These have been a shattering few years. If you are not troubled you have not been paying attention. Indeed, “troubled” will hardly do as a descriptive term. “Exhausted” might be a more honest assessment. The more stable world we once knew, and perhaps took for granted, seems a thing of the past.

But the conference headline also offers a more optimistic thought, and goal: “creative resilience”. This could point to a reasonable route ahead, and an answer to some of our concerns. What form might this resilience take?

In the past, when business leaders have called for resilience from their people, it was not always an encouraging sign. The implication was that, not only are times tough, but only the toughest will survive, and will deserve to survive.

But the discontinuity of 2023 – sometimes referred to as a “polycrisis” – demands a more considered and sophisticated approach than mere machismo. As Lynda Gratton, professor at London Business School, told me in an interview for Drucker Forum TV, a healthier kind of resilience will involve being honest with friends and colleagues about the challenges you are facing. Creative resilience means opening up, not hunkering down and “toughing it out” on your own. Resilience today means acknowledging vulnerability, not denying it. It calls for collaborative endeavour, not lonely attempts at heroic individualism.

Even if the world remains Darwinian, we should understand that the resilience Darwin detected in the natural world was down to the survival of the most adaptable, and not the “fittest”. So creative resilience is very much the kind the great naturalist would have approved of.

Drucker, of course, emphasised the importance of being clear about your objectives. But that clarity should not imply rigidity. As a practical – liberal – art, management must mean finding creative ways of achieving objectives, especially in a world of discontinuity. “Some things change, some stay the same”, as the rock star Chrissie Hynde sings. The trick lies in recognising what has to change and what must not change. This is a task for leadership.

The biggest change looming large in all our lives – beyond geopolitical crises – is the emergence of ever-more powerful “large language models” which support generative artificial intelligence: ChatGPT and the rest. Drucker was famously sceptical about the computer, labelling it a “total moron” in a McKinsey article in 1967. 

In fact, Drucker was well aware of the potential of these powerful processing machines, as long as managers understood how to use them. “Though it can’t make decisions,” he wrote, “the computer will – if we use it intelligently – increase the availability of information…That’s why it’s so important to exploit the computer’s ability to give us only the information we want – nothing else.” Drucker anticipated the danger of “hallucinations” – useless and misleading data, generated by “brilliant” AI at the speed of light.

Working wisely and imaginatively with the new technology, to allow our fellow human beings to work more effectively, may be the top agenda item for managers today. If we want to re-establish a semblance of order in an age of discontinuity, a happy marriage of human and machine will have to be arranged, and managed. At the end of this year’s Drucker Forum perhaps delegates will leave with a few new ideas about how they might achieve this.

About the Author: 

Stefan Stern is the author (with Prof Cary Cooper) of “Myths of Management: what people get wrong about being the boss” , and also of “How To Be A Better Leader”. He is Visiting Professor at Bayes Business School, City, University of London, and a former Financial Times columnist

You know the situation. You have seemingly done nothing different, but suddenly notice that your leadership is less effective, your culture signals infections, and your management system keeps you busy rather than serving your business. It is very likely that these are the early symptoms of a systemic crisis that is about to hit your organization. That crisis is a natural part of your growth cycle. Your organization simply is ready for the transition to the next phase of its development. The task is to build the resilience that enables your organization to continue to grow. 

The growth life cycle model. Greiner’s (1998) widely cited original model, published in 1972 and expanded upon in 1997, suggested that the life cycle of an organization follows five distinct stages. Each has an evolutionary growth phase and a revolutionary crisis phase that must be overcome before the organization can advance and continue to grow.

Entrepreneurial organizations have a design and management style that promotes innovation, creativity, and speed. Direct personal engagement between the founders and employees provides motivation and adequate management direction informally. Success and growth create the crisis of leadership, which must be resolved to continue successful growth.

The company has grown in scope and complexity thanks to entrepreneurial success. Functional organizations are created with professional managers to oversee specific functions or divisions under directive leadership by senior executives. The second crisis of autonomy mounts as functional or divisional managers compete for resources and recognition while being controlled by the directives from the cadre of senior executives. 

Decentralized organizations delegate accountability to managers of sub-units, plants, markets, or geographies. This independence and freedom to act encourages unit managers to employ people-centric methodologies and improves responsiveness to the customer or market. Business unit managers develop and implement processes and systems to measure performance and report to headquarters. Top management at the home office begins to sense a loss of effective oversight, and the crisis of control has arrived.

Segment organizations require coordination by top management through a sophisticated control mechanism. Complex webs of processes, procedures and policies evolve, intended keep headquarters executives informed on what is going on in the segments, so they can step in with corrective actions if the segment wanders from the corporate strategy. Burdensome approval processes degrade responsiveness and stifle innovation. The crisis of red tape arises with increasing size and complexity as the home office attempts to coordinate the various segments through processes and procedures.

Complexity increases, leading to the development of matrix and network organizations that require interaction among the members to collaborate and get things done. Members in the emerging alliances or ecosystems may be external organizations. Consequently, the crisis of sovereignty will emerge.

Three stopes to resilience and growth

Our research on 400 organization over 10 years has revealed three generic steps leaders can adopt to build resilience and continue to grow. Understanding the underlying attributes of the organization in its current growth stage is the first step. Identifying strengths that can be leveraged and weaknesses to be strengthened is the second step. Taking focused action, taking advantage of strengths, eliminating weaknesses, and building essential capabilities becomes the key third step to advance to the next growth state. 

Four transition strategies 

We have identified four transition strategies to help managers build essential capabilities to overcome the limiting crisis and advance down the path to growth. These are: people first, people-centric management, dynamic operations, and agile organization. These general strategies are not mutually exclusive. They should be blended and adapted to meet the unique needs of the organization. To guide the organization through the transition dedicated structures, systems and capabilities help to resolve the natural tension between evolution and revolution.

The need for resilience.

The digital economy accelerates the pace of change and organizational development. Organizations advance through growth life cycle stages quicker and experience crisis more often. Using the life cycle framework, managers can identify potential roadblocks and build resilience with people-centric, agile and dynamic capabilities before crisis hits. With advance warning of impending problems, executives can implement strategies to help navigate the impending storm before it hits. Embedding people-centric dynamic capabilities into the organization enables it to absorb the disruptive shock, react quickly, and emerge with stronger resilience to weather the storm.

Be ready for the transition

Business leaders should be aware of which stage their organization is in, the characteristics of the current stage, and the characteristics of the next stage. Successfully and seamlessly navigating an organization from one stage to another is a challenge for even the most talented leaders. To successfully move from one to the next, top executives and entrepreneurs should be aware of what actions must be taken in advance to make a seamless transition. Leaders should proactively prepare for these transitions by laying the foundations or infrastructure needed to prevent a crisis that inhibits further growth. A clear understanding and appreciation of the growth framework helps managers proactively manage the development of their organization.

Bibliography: Greiner, L. E. (1998). Evolution and Revolution as Organizations Grow. Harvard Business Review: Mai-June.

About the Authors: 

Lukas Michel is the founder of Management Insights, Switzerland, and author of several management books. 

Herb Nold is a Professor of Business Administration at Polk State College, USA, and author. 

Their latest book: THE TRANSITION OF ORGANIZATIONS: Managing for growth at each stage of the organization’s life-cycle. LID Publishing, 2023, London.

Does age really matter if people are in the right role, doing what they love?

The statistics are in, and we now know that the 100-year life, once a distant Holy Grail, is on course to become the new norm. That half of those born today will live into their 100s is incredibly positive news – who wouldn’t want to live longer? In a world that has long adhered to a three-step life journey, made up of childhood, adulthood, and old age – a world where we’re hard-wired to expect retirement at 65 and where the spotlight tends to dim on the over-50s as they’re progressively ushered away from the corporate steering wheel – increasing longevity offers a chance to rethink and re-energise the whole second half of our life.

The fact is, far too many businesses are shackled by outdated timelines and methodologies that don’t cater to a multigenerational workplace. At a time when we’re expected to work deep into our 70s (and possibly beyond), that’s more than inconvenient. Profound changes are needed. We need to reframe how we view aging within corporations. Crucially, we need a shift in mindset that eradicates corporate ageism, particularly towards the over-50s, allowing us to create an infrastructure that encourages people to grow and develop on the job. The good news is that there are forward-thinking companies out there who already have a handle on this. They know how to navigate the shift, but that doesn’t mean that there isn’t still lots of work to do.

Avivah Wittenberg-Cox’s 4-Quarter Lives 

At the end of September, the Global Peter Drucker Forum hosted a discussion entitled “Snowflakes and Seniors: A Manager’s Nightmare or Secret Weapon?” that shined a light on precisely these intergenerational puzzles. It looked at how we can not only redress the balance but also harness the power of experience that comes with age. 

On the panel was thought leader Avivah Wittenberg-Cox, who regularly advises organizations on age balance. She talked about the new corporate landscape and outlined her Life’s 4 Quarters framework that takes a refreshingly inclusive view of our life stages in 2023 and beyond. Avivah also spoke on this topic when she was the featured speaker at our Executive Breakfast in partnership with Global Peter Drucker Forum on June 22 in London. 

For Avivah, the extra years transform our life’s profile. Lives are now divided into quarters, not thirds. They are:

• Q1 Grow (0-24) – Q1 includes childhood, adolescence, and young adulthood, a period during which we can grow up, learn, and explore without being burdened with too much responsibility.
• Q2 Achieve (25-49) – this is the key focus area for much of the current working world, perhaps to its, and our, detriment. There’s immediate pressure to prove yourself, and to tick numerous societal and professional boxes. As such, this is the quarter most likely to benefit from a more measured view of the course of life today.

• Q3 Becoming (50-74) – the new part of the jigsaw, and one that needs fresh focus and definition. Because the fact is, those extra years of lifespan aren’t just tag ends to the preceding achieving and subsequent harvesting quarters, but a separate stage of its own, reshaping how we approach our autumnal years as we continue to develop professionally and personally, with the benefit of by now having learned exactly who we are. Now that careers have morphed from being 30-year sprints into 50-year marathons, this is where the focus needs to be, dramatically altering our view of the over-50s workforce. 
• Q4 Harvesting (75-100) – for too long a period marked by loneliness, when really it should be a time for reaping what you’ve sown in your life up to now, and for continuing to grow and learn. 

The importance of investing long-term in talent

At Emergn, we recognize the value of a multigenerational workforce. We know that good leadership and management can unite different generations – not through creating competition, but by fostering collaboration and creating a positive work environment. Avivah talks about the rich experience that over-50s can draw on through having already dealt with various “lifequakes”, and how those real-life experiences can be invaluable to businesses – and how they can be shared with the wider (yes, younger) team. 

Modern forward-thinking methodologies, such as Emergn’s Incredible Talent Journey, also focus on investing in people. We focus on creating a journey for each employee, covering how we grow together through 1) command of the business; 2) a smart work ethic; 3) consistent follow-up and follow-through; 4) philosophical alignment; and 5) identifying the right role. 

We look at employee careers as a whole and set personalised goals each year so that each person can grow and develop within the company, with the security of long-term commitment. When employees are looked at individually and aligned to the work where they are best suited, retirement can be a discussion much further down the road.

To adapt to our extended lifespans, that needs to be reflected in how we structure our businesses. We need to provide for all stages of life – but crucially, we need to recognize that an intergenerational team can derive huge benefits in terms of motivation, reciprocal learning, and consolidating the value of diversity. 

The importance of creating a work environment where people can dare to grow older can’t be understated. It’s time to act now. 

Find out more about Emergn’s Incredible Talent Journey.

About the Authors:

Anjana Mistry

Chief Financial and Operations Officer, Emergn Limited

Anj brings a deep motivation and desire to weave finance, HR and operational excellence throughout the organizations she’s been a part of through a style of servant leadership, empathy and trust.

In her role, Anj focuses on helping Emergn successfully execute its strategy, build better engagement across the business and a solid foundation for future growth.

For over 25 years, Anj has been a part of global leadership teams focused on improving the way businesses operate, integrate and transform.

Avivah Wittenberg-Cox

Founder and CEO, 20-first

Avivah Wittenberg-Cox is a potent mix of writer, entrepreneur, change agent, coach and consultant. She is a global expert on all things gender and generational balance. She is currently spending a year at Harvard as a 2022 Advanced Leadership Fellow researching all things related to longevity, gender differences in ageing, and navigating later life transitions into the Third and Fourth Quarters. Graphically summarised in her latest book Thriving to 100 – Through Life’s 4 Quarters.

As the CEO of 20-first, she works with organisations interested in capturing the competitive advantages of the future of work, talent and demographic trends. Her ground-breaking thought leadership is accessible through several seminal books and regular contributions to Harvard Business Review and Forbes. She’s done several TEDx talks, was given a Lifetime Achievement Award for Gender Balanced Leadership by PWN Global, and was recently recognized as one of the world’s 40 Most Inspiring Women Over 40. Her book, Why Women Mean Business, was awarded the MANPOWER Best Book of the Year Prize.

In her own First and Second Quarters, she grew up in Toronto, attended the University of Toronto as a joint Computer Science/ Comparative Literature major, went to Paris for a year and stayed for 30, doing an MBA at INSEAD along the way. She has 3 passports (CDN, F, CH), lives in London with her sculptor/ magistrate husband and visits her two grown gender-balanced children, a son and daughter based in Dakar and New York.

On a more personal note, she is tracking her 60th year, back at school at Harvard, in a weekly newsletter called elderberries.

For over 1000 years Icelandic farmers have had a symbiotic relationship with eider ducks. They create shelters (‘Skjól’) for the birds to keep out predators. In May and June, the birds arrive to lay their eggs in these man-made sanctuaries, while farmers keep a watchful eye over them. After the eggs hatch and the birds leave to return to fishing, the farmers collect the down lining in the abandoned nests and process it into the most desirable natural materials for bedding. 

The resilience of this arrangement comes from its simple principle of preserving the birds’ natural, innate ambition, so to speak. Icelandic farmers were early system thinkers. They see the ducks not as employees to be managed, but as ecosystem partners, whose wellbeing is to be cherished. 

Organizations can be seen as shelters for human wellbeing – the most desirable natural material for creative resilience. Its predators – the dulling of skill, extinguishing of ambition, and reduction of possibility – lurk at every turn with attempts to make humans subservient to corporate objectives.

The edge of chaos

Insights from the study of complex systems suggest that creative resilience – such as life’s ability to sustain itself with sufficient creativity to be called ‘life’ – arises at the “edge of chaos”, that fine line between order and disorder. In this state, a system’s components do not quite lock into place, yet also do not descend into chaos. Too much tightness makes the system rigid and thus fragile in the face of external shocks. Too much loosening makes the system turbulent and hard to maintain. 

The locking mechanism for organizations is the taming of personal ambition in the service of corporate, top-down purpose. Employment and entrepreneurship are often juxtaposed as two distinct forms of productive engagement in the economy. Traditionally, one can be an entrepreneur – pursuing their own ambition – or an employee, moderating personal ambition to accommodate organizational purpose. In employment, autonomy and flexibility are traded off for certainty and predictability. Yet with digitalization and artificial intelligence (AI) transforming the workplace, the emergence of non-standard employment leads to potential increased flexibility and freedom. This can promote more entrepreneurialism across the economy, blurring the boundaries between the two forms of engagement. It is now commonplace for established organizations to embrace entrepreneurial thinking and behaviors as they endeavor to survive, renew and prosper in the age of discontinuity. This means that designing work systems that nurture the creative energies of everyone involved in the value creation process is paramount. Wellbeing serves as the fuel and gauge for this evolution.

Me. We. It.

The cornerstone of entrepreneurship as the channeling of creative aspiration is an individual’s ambition to make a distinct mark on the world, control their own destiny and strive for a new, imagined future. With autonomy and freedom come higher uncertainty and workload and resource constraints. The organization that arises is thus a vehicle for individual expression, its purpose subservient to the individual. 

Over time, as the organization expands, it develops the will to survive. The founder becomes a CEO, a custodian of organizational survival. Entrepreneurs often refer to their ventures as their children, but as they transition to the CEO role the child is now a grown-up, with a life of their own and their own interests. Motivation and meaning no longer come from the inside, but from the outside. Size counteracts the creative zeal of founding. The established, growing business unleashes other forces – it seeks to defend its turf, to outcompete. It is now a contestant in a market tournament and driven by the rules of the game. It is an employer. 

A child’s play

How can one keep the creative zeal in a large organization? Nietzsche’s metamorphoses of the spirit suggest an answer. Camel is the load-bearing spirit, quietly carrying the burden of “you shall”. Lion is a freedom-creating spirit, rebelling with the roar of “I will”. This is often the first founder spark in which we dare dream of a different future. The danger is that, with success, our own creations usher back the camel – the organization can load us with “you shall” baggage of its own interests. Child is the spirit of the new: innocent, curious, forgetful, and always seeking a new beginning. An organization needs to enable the spirit of the child, even if it goes against its natural instinct of taming lions into camels. 

In entrepreneurship, creative resilience is fuelled by an ambition to excel in something meaningful. While most organizations embrace an individual’s need to grow and develop, it may not always share their individual priorities, timing, or long-term trajectory. For most organizations, an individual’s ambition must pass the alignment test, and be understood to reinforce the wider organizational purpose. 

The tension between individual ambition and organization purpose represents an important design challenge as work becomes increasingly entrepreneurial across the economy. By some accounts, “entrepreneur” could be traced to “inner life” (antah prana) in Sanskrit. With personal ambition as the fuel of imagination, creativity and innovation, how it is unlocked–and by what means can it be connected to collective purpose–will be crucial to the resilience of creative work.

All is well that stays well

Just as the eider down, creative resilience is a by-product of cherished wellbeing. The places for people in organizations are not positions to be filled, but nests to be protected. A recent AI summit pronounced that in an AI future, no jobs would be needed. Let AI handle the spirit of the camel, while we all enjoy the playground.  

“What we call the beginning is often the end

And to make an end is to make a beginning.

The end is where we start from.” (T.S. Eliot)

About the Authors:

Joseph Pistrui is co-founder of Kinetic Thinking, Professor of Entrepreneurship & Innovation at IE University in Madrid, and a Senior Research Fellow at the Center for the Future of Organization, Drucker School of Management.

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