Exploring beyond yesterdayS
with the help of Peter Drucker
… by necessity, what exists today is the product of yesterday …
and the same will be true tomorrow(S)
(Realities)
This page is not like an article, rather
it is an exploration landscape
for creating foundations
for future directed decisions
We can only work on and with the things on our mental radar
The future of the developed world
depends on what’s between your ears …
and maybe six degrees of separation …
It may be helpful to identify and note
relevant “horizons to work toward” and
useful “areas of work”
in different employment and life situations
Please read slowly and explode the mental landscape(S) you encounter
If you’re of the everything is OK mindset,
beware of unimagined future(S) …
The Shifting Organization Landscape
Consider this: only 11% of the Fortune 500 companies from 1955 still exist today, while the average time that companies stay in the top 500 has fallen from 75 years to 15 years ::: source
Imaginatively speaking, what factors could be seen
by exploding the previous sentence?
«§§§»
Years ago I did “restructuring work” for a Fortune 200 conglomerate consisting of over 90 operating divisions with 40,000 employees.
I never observed a single person who foresaw what was coming even though division divestitures and closures were common knowledge and reported in the business press.
This observation applies to almost all organizations and institutions.
The company had been formed through acquisitions from over sixty different “gene pools” so their common disease cannot be blamed on a single source.
The common mental disease is the belief that yesterday must last forever and that tomorrows have to be extrapolations of what existed previously — the product of yesterday.
So there would be no reason to consider anything beyond yesterday’s routines …
Louis Gerstner’s experience with IBM (a company with more Nobel Laureates that most countries possess) and then Sony
This mental disease is still rampant — there’s no easy cure.
There may be periods of apparent remission, but that may be a delusion.
This disease apparently prevents people from exploratory, realistic, constructive future-directed thinking because they are so busy keeping the corpse from stinking.
This disease infects everything and everybody. It gets passed on to every generation and every contact.
Examples can be seen in the daily news
What to do?
At the minimum, it is advisable to prepare for a world in which you outlive your employing organization.
See “180-degree change” further down the page
A person would have to be mentally “blind” to not see the “narrow” advice (snake oil) flooding through social media (LinkedIn, Twitter, Facebook).
What part of this advice passes the test of time?
If someone had pursued a recommended course of action in 1920, 1950, 1990, or …, what would have been the outcome?
Remember the Fortune 500 at the top of the page? Do you believe that they weren’t seeking advice? Were their remedies effective?
Unfortunately, this page and this site don’t contain any magic bullets. Only the naïve would expect that …
See the next section …
Think of this page as a trip to the mall — a mental shopping mall.
You’re looking at ideas (brain addresses) and deciding whether and how they might fit in your life.
A good shopper has an open mind and active imagination.
A good shopper is aware of short-lived “fashion” trends.
A good shopper takes notes for future thinking and action.
The world and life is a constantly shifting … kaleidoscope? It is useful to have notes for redirecting one’s attention … the next section.
Time usage
“Nothing requires more heroic efforts than to keep a corpse from stinking, and yet nothing is quite so futile,” is an old medical proverb.
“In almost any organization I have come across, the best people are engaged in this futile effort; yet all they can hope to accomplish is to delay acceptance of the inevitable a little longer and at great cost.”
The Transformation
“EVERY FEW HUNDRED YEARS in Western history there occurs a sharp transformation.
We cross what in an earlier book, I called a “divide.”
Within a few short decades, society rearranges itself—its worldview; its basic values; its social and political structure; its arts; its key institutions.
Fifty years later, there is a new world.
And the people born then cannot even imagine the world in which their grandparents lived and into which their own parents were born.
We are currently living through
just such a transformation.
A Century of Social Transformation
It is creating the post-capitalist society, which is the subject of this book.
... snip, snip ...
Our period, two hundred years later, is such a period of transformation.
This time it is not, however, confined to Western society and Western history.
Indeed, it is one of the fundamental changes that there no longer is a “Western” history or, in fact, a “Western” civilization.
There is only world history and world civilization—but both are “Westernized.”
... snip, snip ...
The one thing we can be sure of is that the world that will emerge from the present rearrangement of values, beliefs, social and economic structures, of political concepts and systems, indeed, of worldviews, will be different from anything anyone today imagines.
... snip, snip ...
That the new society will be both a non-socialist and a post-capitalist society is practically certain.
And it is certain also that its primary resource will be knowledge.
This also means that it will have to be a society of organizations.
Certain it is that in politics we have already shifted from the four hundred years of the sovereign nation-state to a pluralism in which the nation-state will be one rather than the only unit of political integration.
It will be one component—though still a key component—in what I call the “post-capitalist polity,” a system in which transnational, regional, nation-state, and local, even tribal, structures compete and co-exist.
Transnationalism, Regionalism, and Tribalism
... snip, snip ...
The market will surely remain the effective integrator of economic activity.
But as a society, the developed countries have also already moved into post-capitalism.
It is fast becoming a society of new “classes,” with a new central resource at its core.
... snip, snip ...
Instead of the old-line capitalist, in developed countries pension funds increasingly control the supply and allocation of money.
... snip, snip ...
The beneficiary owners of the pension funds are, of course, the country’s employees.
If Socialism is defined, as Marx defined it, as ownership of the means of production by the employees, then the United States has become the most “socialist” country around—while still remaining the most “capitalist” one as well.
Pension funds are run by a new breed of capitalists: the faceless, anonymous, salaried employees, the pension funds’ investment analysts and portfolio managers.
But equally important: the real, controlling resource and the absolutely decisive “factor of production” is now neither capital nor land nor labor.
It is knowledge.
Which has unimaginable implications
Knowledge is constantly making itself obsolete and
it doesn’t respect previous boundaries
… one thing leads to something different … which leads
to something different … which leads to something different …
Instead of capitalists and proletarians, the classes of the post-capitalist society are knowledge workers and service workers.
Career assumptions
… “They [individuals] can no longer assume that what they have learned as children and youngsters will be the “foundation” for the rest of their lives.
It will be the “launching pad” — the place to take off from rather than the place to build on and to rest on.
They can no longer assume that they “enter upon a career” which then proceeds along a pre-determined, well-mapped and well-lighted “career path” to a known destination — what the American military calls “progressing in grade.”
The assumption from now on has to be that individuals on their own will have to find, determine, and develop a number of “careers” during their working lives.
Try exploding find, determine, and develop using
thinking broad and thinking detailed along with
information is not enough
Thinking canvases may prove helpful
And the more highly schooled the individuals, the more entrepreneurial their careers and the more demanding their learning challenges” more
Consider the production hierarchy that guides a movie making project, who do they want involved? Will they employ people they don’t trust?
Context exploration: history,
news, & economic system
By looking at the image above, it should be clear that we are embedded in a world moving toward unimagined futures
 The History of the World in Two Hours
Note the civilizations that developed and then stagnated.
Recent news stories from Project Syndicate, McKinsey, Knowledge@Wharton, NPR, MarketWatch, Yahoo, Google
Economic landscape view
Action exploration
The links on this page provide a mental landscape for thinking about time usage alternatives and decisions in a profoundly changing and non-linear world — one thing leads to something different … which leads to something different … which leads to something different ….
Just reading is not enough.
Effective action is needed.
 A Class With Drucker: The Lost Lessons of the World's Greatest Management Teacher
 What Everybody Knows Is Frequently Wrong
If You Keep Doing What Worked in the Past You’re Going to Fail
Approach Problems with Your Ignorance—Not Your Experience
Develop Expertise Outside Your Field to Be an Effective Manager
Outstanding Performance Is Inconsistent with Fear of Failure
You Must Know Your People to Lead Them
People Have No Limits, Even After Failure
Base Your Strategy on the Situation (it may constantly evolve), Not on a Formula
Information is not enough, thinking is needed
Thinking broad and Thinking detailed
Some Basic Processes in Thinking
Action is a time machine.
It needs to be started at the right time and ended at the right time.
And action takes place within a changing world …
Site benefits exploration
One of the advantages of this site is its breadth — 500+ web pages.
There are thinking landscapes for a changing world, changing organizations, changing work lives and evolving life-design thinking.
Almost every page has links to other pages.
To see the entire mental landscape of any “topic” it is necessary to see the elements of the topic and the elements of the topics it connects to — perhaps over several pages.
Page A links to page B which links to page C …
Work life exploration
For those primarily interested in their own work life, post-capitalist executive is probably the best starting point for seeing and thinking about the journey toward tomorrowS.
The material further down the page should not be ignored.
In fact, you should read through it — without following the links — before working through the post-capitalist executive page.
Peter Drucker Sets Us Straight
The post-capitalist executive page link above contains links to The Daily Drucker which provides an very broad mental landscape — timescape.
Which itself links to Managing Oneself which contains the following:
Successful careers are not planned.
They develop when people are prepared for opportunities because they know their strengths, their method of work, and their values.
Knowing where one belongs can transform an ordinary person—hardworking and competent but otherwise mediocre—into an outstanding performer.
… And we will have to stay mentally alert and engaged during a 50-year working life, which means knowing how and when to change the work we do.
Explode the previous sentence?
More here
Managing Oneself is a REVOLUTION in human affairs.
It requires new and unprecedented things from the individual, and especially from the knowledge worker.
For in effect it demands that each knowledge worker THINK and BEHAVE as a Chief Executive Officer.
It also requires an almost 180-degree change in the knowledge workers’ thoughts and actions from what most of us—even of the younger generation—still take for granted as the way to think and the way to act.
The Essential Drucker provides additional important career navigation vision. The chapter on “What The Nonprofits Are Teaching Business” may point toward horizons you want to consider.
There are career paths implied in the change leader and making the future below.
… Altogether, an increasing number of people who are full-time employees have to be managed as if they were volunteers. They are paid, to be sure. But knowledge workers have mobility. They can leave. They own their “means of production,” which is their knowledge.
… “But now the traditional axiom that an enterprise should aim for maximum integration has become almost entirely invalidated.
One reason is that the knowledge needed for any activity has become highly specialized.
It is therefore increasingly expensive, and also increasingly difficult, to maintain enough critical mass for every major task within an enterprise.
And because knowledge rapidly deteriorates unless it is used constantly, maintaining within an organization an activity that is used only intermittently guarantees incompetence” — Peter Drucker
Lego world
“In the twenty-first century, businesses exist in a Lego world.
Companies are built out of Legos: People Legos, Product Legos, Idea Legos, and Real Estate Legos.
And these aren’t just ordinary Legos; they pass through walls and geographic boundaries, and they are transparent.
Everything is visible to everyone all the time.
Designing and connecting the pieces is at least as important as providing them.
It’s crucial to remember that these aren’t simply pieces of plastic or metal—they are not just factories or warehouses.
They are also humans who program computers, train newcomers, and think about innovation as they prowl malls, libraries, and parks, coming up with new products.
These pieces are constantly being put together, pulled apart, and reassembled.
---XXX---
My company’s Legos—manufacturing, distribution, skills, and services—cannot be unique unto themselves; they have to connect with your company’s Legos.
I can build my company, but in a year or two, my CEO and I might have to tear down and rebuild part of it in a totally different configuration, perhaps with fewer American People Legos and more of your company’s People Legos in Sweden or South Africa.” more
Seth Godin says …
Used to be
This hotel used to be a bank.
That conference organizer used to be a travel agent.
This company used to make playing cards.
Perhaps you used to be hooked on keeping score, or used to be totally focused on avoiding the feeling of risk, or used to be the kind of person who needed to be picked …
“Used to be,” is not necessarily a mark of failure or even obsolescence. It’s more often a sign of bravery and progress.
If you were brave enough to leap, who would you choose to ‘used to be’?
Unprepared
Is there anything worse we can say about you and your work? “You are unprepared.”
But the word “unprepared” means two things, not just one. There is the unprepared of the quiz at school, of forgetting your lines, of showing up to a gunfight with a knife … this is the unprepared of the industrial world, the unprepared of being an industrial cog in an industrial system, a cog that is out-of-whack, disconnected and poorly maintained.
What about the other kind, though?
We are unprepared to do something for the first time, always.
We are unprepared to create a new kind of beauty, to connect with another human in a way that we’ve never connected before.
We are unprepared for our first bestseller, or for a massive failure unlike any we’ve ever seen before. We are unprepared to fall in love, and to be loved.
We are unprepared for the reaction when we surprise and delight someone, and unprepared, we must be unprepared, for the next breakthrough.
We’ve been so terrified into the importance of preparation, it’s spilled over into that other realm, the realm of life where we have no choice but to be unprepared.
If you demand that everything that happens be something you are adequately prepared for, I wonder if you’ve chosen never to leap in ways that we need you to leap. Once we embrace this chasm, then for the things for which we can never be prepared, we are of course, always prepared.
The material below should not be ignored. In fact, you should read through it — without following the links — before working through the post-capitalist executive page.
Seeing the ecology
surrounding individual lives
A Century of Social Transformation — emergence of knowledge society
Introduction
The meanest … century in human history
The End of Economic Man: The Origins of Totalitarianism
The Alternative to Tyranny
A Functioning Society
The Ecological Vision
A revolution in every generation is not the answer …
The Social Structure and Its Transformations
The Rise and Fall of the Blue-Collar Worker
The Rise of the Knowledge Worker
The Emerging Knowledge Society
How Knowledges Work
The Employee Society
What Is an Employee?
The Social Sector
Knowledge Economy and Knowledge Polity
School and Education as Society’s Center
The Competitive Knowledge Economy
How Can Government Function?
Conclusion: The Priority Tasks—The Need for Social and Political Innovations
From Analysis to Perception — The New Worldview
The Social Impacts of Information
… snip, snip …
In an information-based society, bigness becomes a “function” and a dependent, rather than an independent, variable.
“Bigger” will be “better” only if the task cannot be done otherwise.
In fact, the characteristics of information imply that the smallest effective size will be best.
All of them are needed, but each for a different task and in a different ecology.
Post-Capitalist Society
… that knowledge has become THE resource rather than a resource is what makes society post-capitalist
I am often asked whether I am an optimist or a pessimist.
For any survivor of this century to be an optimist would be fatuous.
We surely are nowhere near the end of the turbulences, the transformations, the sudden upsets, which have made this century one of the meanest, cruelest, bloodiest in human history.
Unless we can learn how to increase the productivity of knowledge workers and service workers, and increase it fast, the developed countries will face economic stagnation and severe social tension.
Management Challenges for the 21st Century
The challenges and issues discussed in it are already with us in every one of the developed countries and in most of the emerging ones (e.g., Korea or Turkey).
They can already be identified, discussed, analyzed and prescribed for.
Some people, someplace, are already working on them.
But so far very few organizations do, and very few executives.
Those who do work on these challenges today, and thus prepare themselves and their institutions for the new challenges, will be the leaders and dominate tomorrow.
Those who wait until these challenges have indeed become “hot” issues are likely to fall behind, perhaps never to recover.
This book is thus a Call for Action.
These challenges are not arising out of today.
THEY ARE DIFFERENT …
In most cases they are at odds and incompatible with what is accepted and successful today.
We live in a period of PROFOUND TRANSITION and the changes are more radical perhaps than even those that ushered in the “Second Industrial Revolution” of the middle of the 19th century, or the structural changes triggered by the Great Depression and the Second World War.
READING this book will upset and disturb a good many people, as WRITING it disturbed me.
For in many cases—for example, in the challenges inherent in the DISAPPEARING BIRTHRATE in the developed countries, or in the challenges to the individual, and to the employing organization, discussed in the final chapter on MANAGING ONESELF — the new realities and their demands require a REVERSAL of policies that have worked well for the last century and, even more, a change in the MINDSET (mental patterns) of organizations as well as of individuals.
More notes below …
Managing in the Next-Society
… It was changing fundamentally and not only in the developed countries, but in the emerging ones perhaps even more.
The Information Revolution was only one factor, and perhaps not even the most potent one.
Demographics were at least as important, especially the steadily falling birthrates in the developed and emerging countries with a resulting fast shrinkage in the number and proportion of younger people and in the rate of family formation.
And while the Information Revolution was but the culmination of a trend that had been running for more than a century, the shrinkage of the young population was a total reversal and unprecedented.
But there is also another total reversal, the steady decline of manufacturing as a provider of wealth and jobs to the point where, economically, manufacturing is becoming marginal in developed countries but, at the same time, in a seeming paradox, politically all the more powerful.
There is—again unprecedented—the transformation of the workforce and its splintering.
The next two or three decades are likely to see even greater technological change than has occurred in the decades since the emergence of the computer, and also even greater change in industry structures, in the economic landscape, and probably in the social landscape as well.
From corporation to confederation
What executives should remember
The Theory of the Business
Managing for Business Effectiveness
What Business Can Learn from Nonprofits
The New Society of Organizations
The Information Executives Truly Need
Managing Oneself
They’re Not Employees, They’re People
What Makes an Effective Executive
How to Guarantee Non-performance
- Commit any two of the following common sins and non-performance will follow
- Have a Lofty Objective
- To use such statements as “objectives” thus makes sure that no effective work will be done
- For work is always specific, always mundane, always focused
- Yet without work there is non-performance
- Try to Do Several Things at Once
- Splintering of efforts guarantees non-results
- Believe That “Fat Is Beautiful”
- It is even worse to overstaff than to overfund
- For overstaffing always focuses energies on the inside, on “administration” rather than on “results,” on the machinery rather than its purpose
- It immobilizes behind a facade of furious busyness
- Don’t experiment, be dogmatic
- Whatever you do, do it on a grand scale at the first try
- Otherwise, God forbid, you might learn how to do it differently.
- Successful application always demands adaptation, cutting, fitting, trying, balancing
- Always demands testing against reality before there is final total commitment
- Any new program, no matter how well conceived, will run into the unexpected, whether unexpected “problems” or unexpected “successes.”
- Make sure that you will not learn from experience
- Do not think through in advance what you expect; do not then feed back from results to expectations so as to find out what you can do well, but also what your weaknesses, your limitations, and your blind spots are.
- Inability to Abandon
- They may become pointless because the need to which they address themselves no longer exists or is no longer urgent
- They may become pointless because the old need appears in such a new guise as to make obsolete present design, shape, concerns, and policies
- The only rational assumption is that any public service program will sooner or later—and usually sooner—outlive its usefulness, at least in its present form, in respect to its present objectives, and with its present policies
- A public service program that does not conduct itself in contemplation of its own mortality becomes incapable of performance
- Avoiding These Six Deadly Sins Is the Prerequisite for Performance and Results
- Yet, as everyone in public administration knows, most administrators commit most of these “sins” all the time and indeed all of them most of the time
- One reason is plain cowardice
- The Lack of Concern With Performance in Public Administration Theory
- But perhaps even more important than cowardice as an explanation for the tendency of so much of public administration today to commit itself to policies that can only result in nonperformance, is the lack of concern with performance in public administration theory
Conditions for survival
More from Management Challenges for the 21st Century
Introduction
Those who do work on these challenges today, and thus prepare themselves and their institutions for the new challenges, will be the leaders and dominate tomorrow.
Those who wait until these challenges have indeed become “hot” issues are likely to fall behind, perhaps never to recover.
… snip, snip …
These challenges are not arising out of today.
… snip, snip …
In most cases they are at odds and incompatible with what is accepted and successful today.
We live in a period of PROFOUND TRANSITION and the changes are more radical perhaps than even those that ushered in the “Second Industrial Revolution” of the middle of the 19th century, or the structural changes triggered by the Great Depression and the Second World War.
… snip, snip …
For in many cases— … — the new realities and their demands require a REVERSAL of policies that have worked well for the last century and, even more, a change in the MINDSET of organizations as well as of individuals.
Management’s new paradigms
“AS WE ADVANCE deeper into the knowledge economy,
the basic assumptions underlying
much of what is taught and practiced
in the name of management are hopelessly out of date.
They no longer fit reality”
- Why assumptions matter
- Yet, despite their importance, the assumptions are rarely analyzed, rarely studied, rarely challenged indeed rarely even made explicit.
- For a social discipline such as management the assumptions are actually a good deal more important than are the paradigms for a natural science.
- The paradigm—that is, the prevailing general theory—has no impact on the natural universe.
- Whether the paradigm states that the sun rotates around the earth or that, on the contrary, the earth rotates around the sun has no effect on sun and earth.
- A natural science deals with the behavior of OBJECTS.
- But a social discipline such as management deals with the behavior of PEOPLE and HUMAN INSTITUTIONS.
- Practitioners will therefore tend to act and to behave as the discipline’s assumptions tell them to.
- Even more important, the reality of a natural science, the physical universe and its laws, do not change (or if they do only over eons rather than over centuries, let alone over decades).
- The social universe has no “natural laws” of this kind.
- It is thus subject to continuous change.
- And this means that assumptions that were valid yesterday can become invalid and, indeed, totally misleading in no time at all.
Management is the specific and distinguishing organ of any and all organizations
The growth sectors in the 20th century in developed countries have been in “nonbusiness”—in government, in the professions, in health care, in education.
As an employer and a source of livelihood business has been shrinking steadily for a hundred years (or at least since World War I).
And insofar as we can predict, the growth sector in the 21st century in developed countries will not be “business,” that is, organized economic activity.
It is likely to be the nonprofit social sector.
And that is also the sector where management is today most needed and where systematic, principled, theory-based management can yield the greatest results the fastest.
Instead of searching for the right organization, management needs to learn to look for, to develop, to test: the organization that fits the task.
One does not “manage” people.
The task is to lead people.
And the goal is to make productive the specific strengths and knowledge of each individual.
Management, in other words, will increasingly have to be based on the assumption that neither technology nor end use is a foundation for management policy.
They are limitations.
The foundations have to be customer values and customer decisions on the distribution of their disposable income.
It is with those that management policy and management strategy increasingly will have to start.
The new assumption on which management, both as a discipline and as a practice, still increasingly have to base itself is that the scope of management is not legal.
It has to be operational.
It has to embrace the entire process.
It has to be focused on results and performance across the entire economic chain.
Management and national boundaries are no longer congruent.
The scope of management can no longer be politically defined.
National boundaries will continue to be important.
But the new assumption has to be:
National boundaries are important primarily as restraints.
The practice of management—and by no means for businesses only—will increasingly have to be defined operationally rather than politically.
It is therefore the specific function of management to organize the resources of the organization for results outside the organization
It is the organ to make the institution, whether business, church, university, hospital or a battered women’s shelter, capable of producing results outside of itself
Management’s concern and management’s responsibility are everything that affects the performance of the institution and its results—whether inside or outside, whether under the institution’s control or totally beyond it.
Strategy: The new certainties
Introduction Why Strategy?
The Collapsing Birthrate
The Distribution of Income
Industries, whether businesses or nonbusinesses, have to be managed differently depending on whether they are growth industries, mature industries or declining industries
… snip, snip …
In conclusion, institutions—businesses as well as nonbusinesses—will have to learn to base their strategy on their knowledge of, and adaptation to, the trends in the distribution of disposable income and, above all, to any shifts in this distribution. And they need both quantitative information and qualitative analysis.
Defining Performance
Global Competitiveness
Competition on the roadS ahead: … “One consequence of this is that every business must become globally competitive, even if it manufactures or sells only within a local or regional market. The competition is not local anymore—in fact, it knows no boundaries. Every company has to become transnational in the way it is run. … But in e-commerce there are neither local companies nor distinct geographies. Where to manufacture, where to sell, and how to sell will remain important business decisions. But in another twenty years they may no longer determine what a company does, how it does it, and where it does it” … source
All institutions have to make global competitiveness a strategic goal.
No institution, whether a business, a university or a hospital, can hope to survive, let alone to succeed, unless it measures up to the standards set by the leaders in its field, anyplace in the world.
One implication: It is no longer possible to base a business or a country’s economic development on cheap labor.
However low its wages, a business—except for the smallest and most purely local one, for example, a local restaurant—is unlikely to survive, let alone to prosper, unless its workforce rapidly attains the productivity of the leaders of the industry anyplace in the world.
This is true particularly in manufacturing.
For in most manufacturing industries of the developed world the cost of manual labor is rapidly becoming a smaller and smaller factor—one-eighth of total costs or less.
Low labor productivity endangers a company’s survival.
But low labor costs no longer give enough of a cost advantage to offset low labor productivity.
This (as already said in Chapter One) also means that the economic development model of the 20th century—the model first developed by Japan after 1955 and then successfully copied by South Korea and Thailand—no longer works.
Despite their enormous surplus of young people qualified only for unskilled manual work, emerging countries from now on will have to base growth either on technological leadership (as did the United States and Germany in the second half of the 19th century), or on productivity equal to that of the world leaders in a given industry, if not on themselves becoming the world’s productivity leaders.
The same is true for all areas: Design, Marketing, Finance, Innovation—that is, for management altogether.
Performance below the world’s highest standards stunts, even if the costs are very low and even if government subsidies are very high.
And “Protection” no longer protects, no matter how high the custom duties or how low the import quotas.
Still, in all likelihood, we face a protectionist wave throughout the world in the next few decades.
For the first reaction to a period of turbulence is to try to build a wall that shields one’s own garden from the cold winds outside.
But such walls no longer protect institutions—and especially businesses—that do not perform up to world standards.
It will only make them more vulnerable.
The best example is Mexico, which for fifty years from 1929 on had a deliberate policy of building its domestic economy independent of the outside world.
It did this not only by building high walls of protectionism to keep foreign competition out.
it did it—and this was uniquely Mexican in the 20th century world—by practically forbidding its own companies to export.
This attempt to create a modern but purely Mexican economy failed dismally.
Mexico actually became increasingly dependent on imports, both of food and of manufactured products, from the outside world.
It was finally forced to open itself to the outside world, since it simply could no longer pay for the needed imports.
And then Mexico found that a good deal of its industry could not survive.
Similarly, the Japanese tried to protect the bulk of their business and industry by keeping the foreigners out while creating a small but exceedingly competitive number of export industries—and then providing these industries with capital at very low or no cost, thus giving them a tremendous competitive advantage.
That policy too has failed.
The present (1999) crisis in Japan is in large part the result of the failure to make the bulk of Japanese business and industry (and especially its financial industries) globally competitive.
Strategy, therefore, has to accept a new fundamental.
Any institution—and not just businesses—has to measure itself against the standards set by each industry’s leaders anyplace in the world.
The Growing Incongruence Between Economic Reality and Political Reality
The change leader
One cannot manage change
“One can only be ahead of it.
We do not hear much anymore about “overcoming resistance to change,” which ten or fifteen years ago was one of the most popular topics of management books and management seminars.
Everybody has accepted by now that “change is unavoidable.”
But this still implies that change is like “death and taxes”: It should be postponed as long as possible, and no change would be vastly preferable.
But in a period of upheavals, such as the one we are living in, change is the norm.
To be sure, it is painful and risky, and above all it requires a great deal of very hard work.
But unless it is seen as the task of the organization to lead change, the organization whether business, university, hospital and so on will not survive.
In a period of rapid structural change, the only ones who survive are the Change Leaders.
It is therefore a central 21st-century challenge for management that its organization become a change leader.
A change leader sees change as opportunity.
A change leader looks for change, knows how to find the right changes and knows how to make them effective both outside the organization and inside ”
Change policies
 Organized abandonment
Organized improvement
Exploiting success
Reports and meetings ::: staffing opportunities
Creating change
The last policy for the change leader to build into the enterprise is a systematic policy of INNOVATION, that is, a policy to create change.
It is the area to which most attention is being given today.
It may, however, not be the most important one—organized abandonment, improvement, exploiting success may be more productive for a good many enterprises.
And without these policies—abandonment, improvement, exploitation—no organization can hope to be a successful innovator.
But to be a successful change leader an enterprise has to have a policy of systematic innovation.
And the main reason may not even be that change leaders need to innovate—though they do.
The main reason is that a policy of systematic innovation produces the mindset for an organization to be a change leader.
It makes the entire organization see change as an opportunity.
 Windows of opportunity
- Unexpected successes ::: unexpected failures ::: unexpected events
- Incongruities
- Process needs
- Changes in industry and market structures
- Changes in demographics
- Changes in meaning and perception
- New knowledge
This requires a systematic policy to look, every six to twelve months, for changes that might be opportunities
The unexpected success was Drucker’s favorite
… but if innovation is based on exploiting what has already happened—in the enterprise itself, in its markets, in knowledge, in society, in demographics and so on—it is far less risky
And this work should be organized as a regular part of every unit within the enterprise, and of every level of management.
Important to harvest and apply Dense reading and Dense listening and Thinking broad and Thinking detailed
What not to do
Piloting
The change leader’s two budgets
Change and continuity
Making the future
“One thing is certain for developed countries—and probably for the entire world:
We face long years of profound changes.
The changes are not primarily economic changes.
They are not even primarily technological changes.
They are changes in demographics, in politics, in society, in philosophy and, above all, in worldview.
See these
Economic theory and economic policy are unlikely to be effective by themselves in such a period.
And there is no social theory for such a period either.
Only when such a period is over, decades later, are theories likely to be developed to explain what has happened.
But a few things are certain in such a period.
It is futile, for instance, to try to ignore the changes and to pretend that tomorrow will be like yesterday, only more so.
This, however, is the position that existing institutions tend to adopt in such a period—businesses as well as nonbusinesses.
It is, above all, the policy likely to be adopted by the institutions that were most successful in the earlier period before the changes.
They are most likely to suffer from the delusion that tomorrow will be like yesterday, only more so.
Thus it can be confidently predicted that a large number of today’s leaders in all areas, whether business, education or health care, are unlikely still to be around thirty years hence, and certainly not in their present form.
But to try to anticipate the changes is equally unlikely to be successful.
These changes are not predictable.
The only policy likely to succeed is to try to make the future.
Changes of course have to fit the certainties (which this book attempted to outline in the preceding chapter).
Within these restraints, however, the future is still malleable.
It can still be created.
To try to make the future is highly risky.
It is less risky, however, than not to try to make it.
A goodly proportion of those attempting to do what this chapter discusses will surely not succeed.
But, predictably, no one else will.” (survive?)
Making the future II
“The twenty-first century will surely be one of continuing social, economic, and political turmoil and challenge, at least in its early decades.
The Age of Social Transformations is not over yet.
And the challenges looming ahead may be more serious and more daunting still than those posed by the social transformations that have already happened, the social transformations of the twentieth century” — A Century of Social Transformation
Information challenges
Knowledge worker productivity
Managing oneself (a revolution in human affairs)
The changes and challenges of Managing Oneself may seem obvious, if not elementary, compared to the changes and challenges discussed in the earlier chapters.
And the answers may seem to be self-evident to the point of appearing naïve.
To be sure, many topics in the earlier chapters—for example, Being a Change Leader or some of the Information Challenges—are far more complex and require more advanced and more difficult policies, technologies, methodologies.
But most of the new behavior—the new policies, technologies, methodologies—called for in these earlier chapters can be considered EVOLUTIONS.
Managing Oneself is a REVOLUTION in human affairs.
It requires new and unprecedented things from the individual, and especially from the knowledge worker.
For in effect it demands that each knowledge worker THINK and BEHAVE as a Chief Executive Officer.
It also requires an almost 180-degree change in the knowledge workers’ thoughts and actions from what most of us—even of the younger generation—still take for granted as the way to think and the way to act.
Knowledge workers, after all, first came into being in any substantial numbers a generation ago.
(I coined the term “knowledge worker,” but only thirty years ago, in my 1969 book The Age of Discontinuity.)
But also the shift from manual workers who do as they are being told—either by the task or by the boss to knowledge workers who have to manage themselves profoundly challenges social structure.
For every existing society, even the most “individualist” one, takes two things for granted, if only subconsciously: Organizations outlive workers, and most people stay put.
Managing Oneself is based on the very opposite realities: Workers are likely to outlive organizations, and the knowledge worker has mobility.
In the United States MOBILITY is accepted.
But even in the United States, workers outliving organizations—and with it the need to be prepared for a Second and Different Half of One’s Life—is a revolution for which practically no one is prepared.
Nor is any existing institution, for example, the present retirement system.
In the rest of the developed world, however, immobility is expected and accepted.
It is “stability.”
In Germany, for instance, mobility—until very recently came to an end with the individual’s reaching age ten or, at the latest, age sixteen.
If a child did not enter Gymnasium at age ten, he or she had lost any chance ever to go to the university.
And the apprenticeship that the great majority who did not go to the Gymnasium entered at age fifteen or sixteen as a mechanic, a bank clerk, a cook—irrevocably and irreversibly—decided what work the person was going to do the rest of his or her life.
Moving from the occupation of one’s apprenticeship into another occupation was simply not done even when not actually forbidden.
The developed society that faces the greatest challenge and will have to make the most difficult changes is the society that has been most successful in the last fifty years: Japan.
Japan’s success and there is no precedent for it in history—very largely rested on organized immobility—the immobility of “lifetime employment.”
In lifetime employment it is the organization that manages the individual.
And it does so, of course, on the assumption that the individual has no choice.
The individual is being managed.
I very much hope that Japan will find a solution that preserves the social stability, the community—and the social harmony that lifetime employment provided, and yet creates the mobility that knowledge work and knowledge workers must have.
Far more is at stake than Japan’s own society and civic harmony.
A Japanese solution would provide a model—for in every country a functioning society does require cohesion.
Still, a successful Japan will be a very different Japan.
But so will be every other developed country.
The emergence of the knowledge worker who both can and must manage himself or herself is transforming every society.
This book has intentionally confined itself to MANAGEMENT CHALLENGES.
Even in this last chapter, it has talked about the individual, that is, the knowledge worker.
But the changes discussed in this book go way beyond management.
They go way beyond the individual and his or her career.
What this book actually dealt with is:
THE FUTURE OF SOCIETY
See book contents
Thinking
Large view of image above
What do these issues, these challenges mean for …
::: an alternative
Operacy
Thinking canvases
Larger view of the harvesting and implementing image above
Larger view of the action system image on the right above
The Six Thinking Hats
TO-LO-PO-SO-GO
Larger view of the PISCO-TEC image above
The Josh Abrams story
Ten Principles for Life II
The Wisdom of Peter Drucker
Narrow career related days from the The Daily Drucker
Managing Oneself is a REVOLUTION in human affairs
The Essential Drucker
What executives should remember
The Effective Executive
Preface
The World is Full of Options
Life-long learning
The Post-Capitalist Executive
Managing in a Post-Capitalist Society
There are over 500 web-pages on this site — only a few of them are linked just above.
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