David Hurst : Are analogies a faster solution than data based decision models?

The rats gave the first clue: they staggered onto the streets, emitted a drop of blood from their noses and died in droves. As their bodies piled up, newspapers agitated, and citizens complained – why was the sanitation department not removing them? The rodents were collected and cremated and the citizens returned to their preoccupation with working hard and getting rich.

Drucker Forum 2020

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

Only a local doctor and his colleague recognized the pattern – a plague was beginning to sweep through the population. They tried to alert the authorities, but the government was reluctant to sound the alarm. Some action was taken, but the language was optimistic and politicians downplayed the seriousness of the problem. It took a jump in the death toll before serious measures were taken: the town was sealed, and a plague officially declared. The pestilence went on to ravage the city, as usual affecting the poor the most.

From allegory to analogy

 You may recognize this story outline from Albert Camus’ The Plague (1947). Anyone who has read his newly popular allegorical novel would know what to expect during a pandemic.   At the onset of the current coronavirus pandemic, when there was little data, experts conducted what can be thought of as an analogical inquiry, using the liberal arts.

They consulted historians who had studied the flu pandemic of 1918 and other plagues from the past. They looked for comparable coronaviruses, like SARS and MERS. They began to compare experiences in different countries with similar circumstances. They searched for metaphors and analogies, even fiction like The Plague for ideas that might be relevant.

Action before data

Like so many entrepreneurs, it seems clear that those countries whose leaders took early decisions to quarantine their societies, based on wise judgement, had much better experiences. They were willing to commit to action, rather than wait for the inevitable delay for data and calculation. Only once data was available could they claim to be ‘guided by science’ and ‘evidence-based’. But because of the exponential growth of the virus, a few days delay could make a huge difference.

What really matters

“There are only two or three human stories,” wrote Willa Cather, “and they go on repeating themselves as fiercely as if they had never happened before.” We are living through just such a story right now.

The universe may be made of matter, but we humans live in a world of value and significance, of ‘what matters’. Science deals with fact, narrative deals with truth. As screenwriter, Robert McKee explains, “What happens is fact, not truth. Truth is what we think about what happens.”

Leadership requires empathy and decency

This is the power of analogical inquiry. The liberal arts help us learn from the experiences of others, to feel what they felt and to think what they thought. We call the quality ‘empathy’, the essence of what it means to be alive and the critical ingredient of effective leadership – a preoccupation with “what matters”.

This is Camus’ message: the “plague”, ill-fortune and injustice in its many forms, comes and goes but never completely disappears. It is the underlying human condition, to which our response must always be one of caring – ‘common decency’ “There is no question of heroism in all this,” says Dr. Rieux, Camus’ narrator, “It’s a matter of common decency. That’s an idea that makes people smile, but the only means of fighting a plague is – common decency.”

About the Author:
David Hurst is a speaker, writer and management educator (www.davidkhurst.com). His most recent book is The New Ecology of Leadership: Business Mastery in a Chaotic World (Columbia University Press 2012)

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

Panelists:
Chair: Richard Brem, Senior Advisor, Peter Drucker Society of Europe,
Peter Paschek, Management Consultant,
Timo Meynhardt, Professor for Business Psychology and Leadership, HHL Leipzig Graduate School of Management,
Verena Ringler, Curator, Erste Foundation
Aaron Barcant, Independent Researcher, Karl Polanyi Institute of Political Economy

The round table began with Richard Brem introducing the panelists and each of them summarizing why Peter Drucker’s work and vision mattered to them.

Drucker’s vision

Drucker always argued that one’s worldview mattered to one’s understanding of one’s role and contribution in society and one’s ability to manage oneself and others. American philosopher Thomas Sowell, describes a vision as a ‘pre-analytic, cognitive act’ that helps simplify an overwhelmingly complex reality. Think of it as a walking stick that helps you travel over rugged terrain, giving you support when you need it and allowing you to probe the way ahead. A social vision gives us a sense of how the world works, of the nature of humankind, of causation and how social change happens.

As panelist Peter Paschek pointed out, Drucker described himself as a ‘conservative Christian anarchist’. While accepting the necessity of governance and government, he saw power and the yearning for power as the central problem of society, with that of managerial power and its legitimacy a particular concern. The political philosopher he admired most was Wilhelm von Humboldt, the pioneer of the modern research university, who found balance and harmony while managing the tension between continuity and change. Drucker was concerned with this balance at several levels, especially those of society and community. It was this interest that allowed him to see management as a social function, an organ of society that is responsible for the performance of institutions and gives the individual both status and function. Panelist Timo Meynhardt said that Drucker’s depth of thought and his emphasis on values – his practical wisdom – was his distinctive strength, making him a ‘companion in the darkness’.

Drucker Forum 2019

This article is one in the “shape the debate” series relating to the 11th Global Peter Drucker Forum, under the theme “The Power of Ecosystems” taking place on November 21 & 22, 2019 in Vienna, Austria.
#GPDF19 #ecosystems

Drucker had what Sowell calls a ‘constrained’ vision – a feature that he shares with thinkers like Adam Smith, Edmund Burke, the authors of the Federalist Papers and Friedrich Hayek among others. It is a vision of society as an evolutionary product with much wisdom contained in the traditions that are handed down to us. History matters and experience is critical. Order is emergent from the interactions of many individuals rather than planned and the emphasis is on practices, processes, incentives, trade-offs and prudence. This constrained vision was in contrast to the much less, if not unconstrained vision of his close friend, Christian socialist Karl Polanyi. While he and Drucker agreed on their ends – to tame capitalism and hold economic power to democratic account – they differed greatly on the means to achieve it. While Drucker regarded economic man as a once-appropriate idea that had been over applied, Polanyi thought it an outright mistake, with the ideal of a self-regulated market never existing in practice. Drucker’s concern over the very real limits to what the state can do and the ever-present risk of factional strife, required a large role for markets, albeit imperfect ones, as a valuable and effective tool to help balance the private sector against the state. Enlightened individualism must serve society. Polanyi, on the other hand, with his more utopian vision of the primitive community, saw a much larger role for an activist state (it was noted that Polanyi’s ideas have attracted renewed attention since the financial crisis of 2008 and the disenchantment with capitalism that has accompanied it).

The role of history

For those with a constrained social vision history really matters. Panelist Aaron Barcant suggested that Drucker’s view of history matches that of Neustadt and May in their book Thinking in Time. Here is what they have to say about thinking of time as a turbulent stream:

“Thinking of time [as a stream] . . . appears . . . to have three components. One is the recognition that the future has no place to come from except from the past, hence the past has predictive value. Another element is recognition that what matters for the future in the present is departures from the past, alterations, changes, which prospectively or actually divert familiar flows from accustomed channels, thus affecting the predictive value and much else besides. A third component is continuous comparison, an almost constant oscillation from present to future to past and back, heedful of prospective changes, concerned to expedite, limit, guide, counter, or accept it as the fruits of such comparison suggest.” (p. 251)

Thus history has predictive value, not because the future will be like the past, but because some things will continue, habits will endure, and humans will tend to behave in the future much as they have behaved in the past, given similar contexts. We cannot predict the future, but studying history is a way of expanding our experience, making us resilient in the face of change, so that we can interpret the past to help us understand the present and anticipate the future.

Looking at the present

The study of history may actually enhance a manager’s ability to stay in the present and to focus on doing what is happening and has to be done.

As panel chair Richard Brem pointed out, Drucker was never a futurist. In 1992, relatively late in his career, Drucker identified himself as a social ecologist and wrote: ‘If there is one thing I am not…it is a “futurist”….it is futile to try and foresee the future….the work of a social ecologist is to identify the changes that have already happened. The important challenge in society, economy, politics is to exploit the changes that have already occurred and use them as opportunities.’

The events that mattered did not lend themselves to quantification. They happened at the margins of society. By the time they show up in aggregates and become statistically significant they are ‘past’. Drucker’s injunction was to ‘look out the window’.

When we ‘look out the window’ for clues to the future of society what do we see? Those with an unconstrained social vision sometimes talk of utopian moves toward cooperation on a larger scale and world government. The evidence around us indicates otherwise. The rise of populism and the disenchantment with both capitalism and democracy in the West suggest a movement toward disaggregation, with attention being paid to smaller units of cooperation. The failure of the federal government in America to address issues of popular concern has led to a renewed focus on the state and municipal government and local communities – the grass roots – as the places where things get done. Panelist Verena Ringler talked about the blurring of what is public and what is private and of cities like Palermo and Barcelona, where pockets of local cooperation are forming in opposition to the policies of national governments. Other cooperative communities, such as the well-known example of Mondragon, also offer alternative ways of coping with the tensions between democracy and management discretion, market forces and social forces, community and society.

‘What would Drucker have made of China?’, one participant asked. Karl Polanyi might have argued that the China case shows that capitalism is antithetical to democracy. Drucker would have taken a more developmental approach, perhaps quoting Berthold Brecht, ‘Food first, then ethics’.

The powerful play goes on….

About the Author:

David K. Hurst is a management speaker, writer and educator. His latest book is The New Ecology of Leadership: Business Mastery in a Chaotic World (Columbia University Press 2012)

This article is one in the Drucker Forum “shape the debate” series relating to the 11th Global Peter Drucker Forum, under the theme “The Power of Ecosystems”, taking place on November 21-22, 2019 in Vienna, Austria #GPDF19 #ecosystems

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The respected management scholar, Donald Schön, began his 1987 book, The Education of the Reflective Practitioner, as follows: “In the varied topography of professional practice, there is a high, hard ground overlooking a swamp. On the high ground, management problems lend themselves to solution through the application of research-based theory and technique. In the swampy lowland, messy confusing problems defy technical solution. The irony of this situation is that the problems of the high ground tend to be relatively unimportant to individuals or society at large, however great their technical interest might be, while in the swamp lie the issues of greatest human concern. The practitioner must choose. Shall he remain on the high ground where he can solve relatively unimportant problems according to prevailing standards of rigor, or shall he descend into the swamp of important problems and non-rigorous inquiry?”

Drucker Forum 2019

This article is one in the “shape the debate” series relating to the 11th Global Peter Drucker Forum, under the theme “The Power of Ecosystems” taking place on November 21 & 22, 2019 in Vienna, Austria.
#GPDF19 #ecosystems

Unfortunately, the concept of a business ecosystem has been largely captured by the high-ground dwellers in mainstream Anglo-American management. If you want to control something, treat it as an object and don’t allow it to move until “motivated”. With mainstream management’s emphasis on prediction and control, this is what has happened to business ecosystems. They are treated as static structures, waiting to be mapped, measured and set in motion, that is, designed by architects in lofty perches outside the system. This view of ecosystems-as-structures has mechanical appeal but little power. Missing from it are the dynamics of natural ecosystems and their capacity for generative metaphors and insights into the tensions between stability and change, the importance of scale and the workings of nonlinear causality.

Some key concepts from treating ecosystems as processes are:

• emergence, the discovery of novelty and the conditions that promote it
• ecological succession as economies of scale assert themselves
• attractors, especially rigidity and failure traps in which organizations can get stuck
• adaptive cycles and the roles of crisis and destruction in ecological renewal
• ecological versus engineering resilience and the dynamics of sustainability
• the power of acting one’s way into better ways of thinking
• the fundamental tension between continuity and change that confronts every reflective practitioner.

Schön’s book was published more than 30 years ago, but his question remains relevant. Current counterparts to his topographical metaphors are the concepts of complicated and complex challenges. Complicated tasks, like putting a man on the moon and returning him to earth, are risky, “high-ground” problems that yield to engineering-technical approaches. Complex dilemmas, on the other hand, thrive in the swampy lowlands of uncertainty. How to raise this child? How to create an enterprise in my situation? How to enable innovation in this organization with these people, right here right now? These messy, confusing questions require an ecological-adaptive approach tailored to each unique situation. The “what-to-dos” may be generic, but the “how-to-dos” are specific. History, context and narrative make every organization different.

In short, we still need to exorcise from mainstream Anglo-American management the ghostly remnants of a positivist commitment to a values-free, analytic, explanatory, instrumental “Cartesian” science of quantities, with its search for general laws. This can be achieved only by embracing and containing it within a values-laden, holistic, interpretive, existential “Goethean” quest for meaning.

Surely Peter Drucker would approve.

About the Author:

David K. Hurst is a management speaker, writer and educator. His latest book is The New Ecology of Leadership: Business Mastery in a Chaotic World (Columbia University Press 2012)

This article is one in the Drucker Forum “shape the debate” series relating to the 11th Global Peter Drucker Forum, under the theme “The Power of Ecosystems”, taking place on November 21-22, 2019 in Vienna, Austria #GPDF19 #ecosystems

“Warm hearts allied with cool heads seek a middle way between the extremes of abstract theory and personal impulse”

Stephen Toulmin, Return to Reason

In Masters of Management (2011) Adrian Wooldridge (Bagehot columnist for The Economist and frequent Drucker Forum participant) identified four defects in management theory:

1. That it was constitutionally incapable of self-criticism
2. Its terminology confuses rather than educates
3. It rarely rises above common sense
4. It is faddish and bedeviled by contradictions

After declaring management theory “guilty” on all charges in various degrees, he identified the root problem as an “intellectual confusion at the heart of management theory; it has become… a battleground between two radically opposed philosophies. Management theorists usually belong to one of two rival schools. Each of which is inspired by a different philosophy of nature; and management practice has oscillated wildly between these two positions.” He went on to identify the two schools as scientific management on the one hand and humanistic management on the other, concluding that, “This, in essence, is the debate between ‘hard’ and ‘soft’ management.”

It’s Not a Bug, It’s a Feature

It’s time to recognize our fundamentally divided nature as the essence of our humanity and that it is the practical weaving together of irreconcilable opposites that is the very warp and woof of our existence as human beings. It is not a bug but a feature of our success as a species and our ability to grapple with uncertainty by cooperating in groups much larger than the extended family. Managers and leaders must integrate this diversity. That takes art, craft, a little science, powerful metaphors and compelling stories, lots of stories.

The Engineer and the Gardener

Over the last sixty years the focus of Anglo-American management has been on means rather than ends. Many regard management as applied economics. The stress on efficiency has been very successful, at least according to the metrics it values. This engineering-technical approach, however, tends to view organizations as machines and people as instruments. The spotlight on utility and stability has led to an inability to address identity, purpose, innovation and change, especially in large-scale organizations. To do that requires an organic, ecological-adaptive approach – the earth-caked hands and patient habits of a gardener. Through this lens organizations are organisms and people are ends-in-themselves. The resulting tensions go with the job of being a manager and a leader.

Complicated and Complex Challenges

The engineering approach is not wrong. It works well in the natural sciences, but erratically in management. Complexity science tells us why. Project Apollo NASA’s program to put a man on the moon was a technically-complicated challenge. The cause-and-effect relationships were stable and understandable to engineers. On the other hand, raising children, starting new businesses or innovating in existing ones are complex challenges. The ‘components’ have minds of their own and causality has to be continually discovered and rediscovered. Complex challenges cannot be reduced to merely complicated ones, so managers are always grappling with an unknown compound of the two. When uncertainty rules ‘gardeners’ are needed.

The Individual and The Community

The engineering-technical approach to management emphasizes the role of the individual and neglects that of community, especially the role of the community in producing, not just individuals, but human beings. It privileges ‘I’ over ‘we’. There is much we can learn from the African concept of ubuntu, often translated as ‘I am because you are’. What makes us human is our connectedness with each other and the empathy that flows from that. The standard Zulu greeting is sawubona – “I see you.” The response is sikhona – “I am here.” Humanity is a quality we owe to each other. It follows then that management is always both a moral and a technical practice.

Masculine and Feminine

There is widening discussion in management about the meager representation of women at the top of business. It’s time to recognize the systemic roots of this issue in the Anglo-American management’s mono-logical mindset and heroic, ‘make-it-happen’ ethos that crowds out everything else. Engineering sounds hard, tough, masculine and predictable. Gardening has a very different feel. Gardeners care, they nurture, they tend. They realize that young enterprises and emergent strategies have to be cultivated and grown not designed and built. They understand the ecology of the situation, discerning the possibilities in this organization, right here, right now. They have to select and plant, water and fertilize, train and prune – and sometimes uproot and transplant. It’s a subtle, indirect approach, always embedded in complexity and calling on multiple perspectives to ‘help it happen’.

A Single Mind with Two Brains

After this litany of tensions and dilemmas the good news is that we humans have evolved to handle paradox. Our single mind consists of two brains, two ways of being in the world that are in creative tension with one another. One way is concerned with the familiar, the other with the novel, the one with what’s predictable, the other with what’s possible, the one with what is fixed, static, decontextualized and explicit, the other with the variable, dynamic, embedded and implicit. The mind is a loom that continually weaves a fabric of meaning, where the whole is greater than the sum of its parts.

East and West

Gardeners and engineers, yin and yang; the Taoist polarities capture well the weaving dynamic of management. Evolution uses a dual model, with a creative dynamic between female and male, as its default for its key mission – the production, care and development of the next generation. Gender is not destiny, but both roles must be played. Why would it be any different for creating sustainable organizations and societies? As managers we need a dual-systems view; a ‘dialectic of polarity’ as Drucker called it, between the existential and the instrumental, complex and complicated. This will take a social movement, a community of practice and some gardeners who also know how to be engineers. And have the judgment to know when.

About the Author:

David Hurst is a speaker, writer and management educator. He is the author of “The New Ecology of Leadership”.

This article is one in a series related to the 10th Global Peter Drucker Forum, with the theme management. the human dimension, taking place on November 29 & 30, 2018 in Vienna, Austria #GPDF18

This article first appeared on LinkedIn Pulse

‘The arts of life…turn out to possess their own special methods and techniques…Bad judgement here consists not in failing to apply the methods of natural science, but, on the contrary, in over-applying them’.

Isaiah Berlin, Political Judgement

Ever since the European Enlightenment reason has been regarded as the hallmark of our humanity. The French philosophes argued that it was the power of abstract thought that separated us from animals. Only reason promised a certainty that could free us from the tyranny of tradition, dogmatic faith and arbitrary rule.

Reason and rationality

There was, however, not a single Enlightenment. While the French took Descartes as their model and focused on the supremacy of his rational method, the English and Scottish Enlightenments emphasized its limits. For the British the essence of human nature was a moral sense of right and wrong and a natural empathy for others. For them reason meant reasonableness, not rationality. These different perspectives have led to radically different understandings of change in social systems, exemplified by the clash between the conservative Edmund Burke and the radical Thomas Paine and their differing views on the French Revolution.  Burke saw it as an unmitigated disaster, a destruction of community and tradition that heralded the age of ‘economists and calculators’. Paine, on the other hand, cheered it to the echo.

American politicians have never quite figured out which branch of the Enlightenment they belong to. Jefferson and Hamilton took opposite sides and, despite his conservative views, even Ronald Reagan was fond of quoting Paine’s aphorism that ‘We have it in our power to make the world over again’.  The divisions continue to this day. Conservatives, like Burke, are aghast at the thought of intellectuals trying to design and build what can only be grown, while the followers of Paine espouse progressive agendas to make the world anew.

American management, in contrast with politics, has never been in much philosophical doubt. One can track the roots of this confidence back to the 19th century influence of French thinking in the United States Military Academy at West Point, the nursery of so many early management pioneers. When the business schools were reformed in the late 1950s, Anglo-American philosophy was in a tight, analytic orbit. Academics aspired to make management a science in the mould of economics. Scientific rationality was seen as the only true knowledge and the scientific method as the only valid form of inquiry. Thus management was deemed to be a technical practice involving the application of theory. Organizational change was viewed as a rational, top-down, outside-in process, a perspective that reached its peak in the re-engineering craze of the 1990s. Even today, to be told that one is ‘rational’ is taken as a compliment and deviations from scientific rationality are described as ‘flaws’ and ‘biases’.

Evolution is smarter than we are

If scientific rationality is such a superior way to approach the world. why haven’t we evolved to be rational in this sense? In opposition to the ‘flaws and biases’ view there is that of cognitive scientists like Hugo Mercier and Dan Sperber. They contend that reason did not emerge to enable individuals to reach better decisions; it developed to allow individuals to rationalize decisions that had they already made through largely unconscious processes. While at the individual level this results in the well-known ‘confirmation bias’, at the level of the group it is adaptive. Groups make much better decisions when they are exposed to passionate individuals making evidence-based arguments for widely differing course of action. What is rational for individuals may be irrational for society and vice versa. And the unit of evolutionary survival is the population, not the individual.

Return to reason

In management the age of ‘economists and calculators’ has been in full swing for decades and the advent of big data and AI promises only to extend it. But if machine algorithms can be better scientists than we are, then the dominant Cartesian rationalist philosophy is in trouble. To restore the human dimension to management we need to move away from narrow, scientific rationality (contra Steven Pinker) to a broader concept of reason. This will require a pragmatic philosophy that acknowledges our need to answer both existential and instrumental questions:

• Identity: Who are we and why do we matter?
• Utility: What do we/I want and how do we/I get it?

Machines can’t follow us there; they may process information, but they don’t make meaning.

This will not be easy. It requires us to see the arts and the humanities as analogical modes of inquiry, just as valid as the analytical mode of science. Here there is no Cartesian ‘I’ to change ‘my’ mindset. It takes compelling immersive experiences a.k.a. ‘life’ to appreciate the power of the arts and social movements to shape our identities, our ways of being. This is, of course, the genius of evolution; it does not rely on one generation to renew itself indefinitely. It depends on new generations with different genetic and cultural backgrounds and experiences to build in Burkean fashion on what has gone before them. Otherwise we could all switch to asexual reproduction and live forever as clones, but frankly that doesn’t sound like much fun.…

This article is one in a series related to the 10th Global Peter Drucker Forum, with the theme management. the human dimension, taking place on November 29 & 30, 2018 in Vienna, Austria #GPDF18

This article was first published on Linkedin.

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• Sigmund Freud (1856-1939) claimed that it was the ‘will to pleasure’
• Alfred Adler (1870-1937) argued that it was the ‘will to power’
• Viktor Frankl (1905-1997) contended that it was the ‘will to meaning’

All of them have a kernel of truth, for it’s difficult to imagine humans flourishing without each of these incommensurable components, although the mix would be different for every person. Perhaps they are stages in life. When one is young it’s mostly about pleasure; in adulthood our focus is on power and control and in old age we become makers of meaning. But we are always concerned with all three.

One suspects that Peter Drucker would have supported Frankl’s emphasis on our quest for meaning. Frankl wrote that meaning could be found in three contexts that were close to Drucker’s own experience:

• Through significant work and achievement
• Through relationships, love and caring
• Though suffering and courage in times of adversity

Once again, all three are surely necessary for a meaningful life. Frankl stressed the importance of the individual sense of responsibility that has to emerge from these experiences, the responsibility to accept the different tasks that life sets for every one of us and to find answers to the problems that we face. Echoing Nietzsche, he writes, “He (who) knows the ‘why’ for his existence, … will be able to bear almost any ‘how’”, which reminds one of Drucker’s thoughts on the primary responsibility of leaders to continually articulate the mission and purpose of their organizations.

Ways and Means

Anglo-American management has long been preoccupied with ways and means, rather than purposes and ends. In the mid-20^th Century, with a gospel of progress an instrumental, technological approach emerged. As sociologist Philip Selznick suggested, management academics were concerned that they be seen as scientists rather than moralists; “…they say given your ends, whatever they may be, the study of administration will help you achieve them. We offer you tools.” The emphasis has been on human individuals as mono-logical, rational actors making rational choices in the pursuit of selfish ends. The focus on exchange and consumption, with money taken as the universal solvent, has resulted in a view of life and living that is closer to Freud’s (with Adler as a sub-text) than Frankl’s. The answer is always ‘more’. As management scholar James March has remarked, we have been preoccupied with ‘plumbing’ rather than ‘poetry’, with the logic of consequences, what the economists call utility, to the neglect of the many logics of identity. For despite the economists’ emphasis on rationality, the evidence is that most human decision-making is an attempt to answer three questions, both individually and collectively:

1. What kind of situation is this?
2. What kind of person am I?
3. What does a person like me do in a situation like this?

We are rather better rationalizers than reasoners, rarely able to make rational choices in prospect, but adept at retrospectively rationalizing the decisions we do make and defending them. Our so-called cognitive biases are not a flaw but a reflection of the kind of situations we faced as we evolved as a species. For we evolved to make fast ‘good-enough’ decisions under pressure of time and conditions of uncertainty. Often there was little agreement on the nature of the problem and little certainty as to its solution. The unit of survival was always the community, not the individual and our make-up reflects the emphasis that evolution placed on agility and cooperation within groups, rather than competition. Cooperation was enhanced when we knew that people would play roles that reflected their identity rather than their self-interest. We trust people who are honest by character and conviction, rather than only by calculation and choice.

What Do People Like Us Do in a Situation Like This?

Pablo Picasso once opined that computers were useless because they only gave answers. They give answers to ‘complicated’ problems, where the range of possible outcomes is clear and their probabilities can be calculated. Management action can be direct and outcomes and risks measured. Unfortunately many of the problems that organizations face are ‘wicked’ – complex rather than complicated. There are multiple stakeholders with different imperatives and the puzzle changes its form as one grapples with it.  Uncertainty reigns, with the range of outcomes unknowable and their probabilities incalculable.

Prosperity and inclusive growth are wicked problems. So what do people like us (managers) do in situations like this? I believe that we have to act and think more like gardeners and less like engineers; prosperity has to be cultivated, it cannot be manufactured.  As English economist, John Kay points out in his fine book, Obliquity, in such contexts decision-making cannot proceed by defining objectives, analyzing them into goals and breaking them down into actions. Friedrich Hayek labeled the belief that one could construct what should be inherited or learned as ‘the fatal conceit’ and showed how those who had attempted it had done massive damage to the complex systems they tried to build.

Thus we cannot create either prosperity or inclusive growth directly, we can only work obliquely and create the conditions for them to happen.  We can select and plant and tend, never forgetting the vast natural system on which everything depends. In complex human systems this includes the institutional taproots of our societies; the family, the primary school and communities of faith. Here the understanding of how things happen is captured in sense-making narratives, unique to every organization, not predictive chains of logic based on general principles. It’s all about the growth and development of organisms whose trajectories are path-dependent and inimitable. In a well-known 2010 article in the Harvard Business Review, Clay Christensen wrote, “Management is the most noble of professions if practiced well. No other occupation offers as many ways to help others learn and grow, take responsibility and be recognized for achievement, and contribute to the success of a team.” It is this noble practice that should be front and center in Vienna this November.

About the author:

David K. Hurst is a management speaker, writer and educator. His latest book is The New Ecology of Leadership: Business Mastery in a Chaotic World (Columbia University Press 2012).

The Founding Fathers ensured that this was the case in the structure of the American government when they wisely arranged the different branches of government in a systems hierarchy of constraint. The House of Representatives is elected every two years, Presidents every four years, the Senate every six years (on staggered terms) and the Supreme Court is appointed for life. The intent was to create a stable system of checks and balances that could handle only modest change and would not be subject to sudden radical movements. For similar reasons, James Madison favoured representative democracy and rule by experts over direct democracy and rule by faction. There are analogous, if less engineered, hierarchies of constraint in dual-house – elected and appointed – parliamentary systems. The role of the ‘upper’ house is to reconsider and modify the occasionally impulsive actions coming to it from below.

From a systems perspective, when British Prime Minister David Cameron agreed to a referendum on whether to remain with or leave the European Union, he was risking that a small, fast system might escape the constraints of representative democracy and the sovereignty of Parliament. It has escaped, and the result is crisis and chaos. Some say it is the end of the Post-World War II political dispensation. Perhaps, but it is also an opportunity for both Britain and the EU.

The Waning Narrative of the European Union

Three years ago I gave a presentation to the International Forum on the Future of Europe in Vilnius, Lithuania. In it, I suggested that the problem with the EU was that it had lost its narrative. I used an ecological perspective to show how the EU had been born in the aftermath of the Second European Thirty Year War (1914-1945) as a passionate movement to avoid further conflict among the nations of Europe. After initial success, greatly aided by the rebuilding of Europe’s shattered infrastructure, it became a series of increasingly ambitious economic and political projects. In that process, however, like all successful institutions, it became much larger, more calculative, rule-driven and bureaucratic. The stories told by expert economists and bureaucrats are rarely compelling and, as the original narrative waned, means became ends-in-themselves.

Economic attachments are fragile. We may work for money, but we live for the story. An ecological perspective suggested that any “buy-in” would be temporary at best and that the resulting tepid commitment would fluctuate with the EU’s economic fortunes. This is particularly the case if economic gains are spread unevenly and significant segments of the population feel left out and ignored. The result was widespread Euroscepticism that, as Nigel Farage, then the leader of Britain’s United Kingdom Independence Party (UKIP) proclaimed, was all about national identity.  The Brexit Referendum became a contest between technicians favouring the status quo and populists promising a return of a Little England narrative. The story won: it usually does.

With Crisis Comes Opportunity 

“Never let a good crisis go to waste” is an aphorism often attributed to Winston Churchill but never sourced. The idea probably comes from Chinese Taoist philosophy and its use of natural analogies to understand stability and change. Crisis plays a pivotal role in the renewal of ecosystems. Wind and fire, flood and pestilence clear away old growth in mature forests and open up patches, where there is equal access to water and light. Here young organisms, fueled by nutrients from a recycled past, can flourish and renew the system.

In Britain, it seems likely that the old political party arrangements no longer reflect the new divisions in the electorate. The Conservatives are badly split, and left-wing Labour Party has been called a “walking ghost”. It performed poorly in the referendum, with many of its members ignoring its call to “Remain”. There is now a contest for its leadership. So the Brexit crisis may act as a catalyst for the reform and reconfiguration of Britain’s political parties, something that would be extraordinarily difficult to do in regular times.  By the time this new configuration has gone to the polls for a new mandate it is possible that the whole Brexit concept will be so completely muddled that a crisis-induced, reformed EU may accept some version of Bremain.

In the EU, it is time for its leaders to reflect upon the entire project. Those with direct experience of World War II are nearly gone and with their passing, the founding narratives of the EU become second-hand memories. The administrative integration of the EU’s members needs to be slowed and even rolled back, a direction to which Angela Merkel seems sympathetic. The creation of the Euro was a bold but premature move, freezing the system when it still needed significant wiggle room. Attention should be on strengthening European identity through new narratives and the creation of compelling experiences that build and maintain them. You can only fight old stories with new narratives. It will not be easy. The late historian Tony Judt stated the challenge well in his paradoxical thesis that Europe has been able to rebuild itself politically and economically only by forgetting the past, but that it can define itself morally and culturally only by remembering it. Perhaps it is time to start the process again with the generations born since 1945.

Management Lessons from the Brexit Moment

What can managers learn from the Brexit moment? Stability is a relative matter, and nature teaches us that great stability is often achieved at the cost of a system’s resilience. The resulting structures are hard but brittle. Authoritarian organizations are like this. Resilient systems need to flex and flow, not by trashing hierarchy – that is a recipe for chaos – but by minimizing the number of levels and designing the constraints to ensure that there is discretionary space at every level in which to act and to innovate. The Toyota Production System (TPS) comes to mind. Toyota is a highly bureaucratic organization, but the TPS creates spaces in which everyone at every level can act to take advantage of opportunities that appear only at that level of granularity. The military equivalent is auftragstaktik, so-called “mission command”. It is a form of directed opportunism that encourages initiative in all ranks. Unfortunately, it is not a one-time affair but a fundamental philosophy that has to be faithfully followed. As organizations grow in scale, enabling hierarchies of constraint continually threaten to morph into coercive hierarchies of control, closing out the spaces for discretion and judgement and stifling entrepreneurship and innovation.

The bottom line is that with crisis comes opportunity and, as Charles de Gaulle remarked of the French Army in 1942, “Nothing lasts unless it is incessantly renewed…”

About the author:

David K. Hurst is a management author, educator, and consultant. His latest book is The New Ecology of Leadership: Business Mastery in a Chaotic World (Columbia University Press 2012).

1. That it was constitutionally incapable of self-criticism
2. Its terminology confuses rather than educates
3. It rarely rises above common sense
4. It is faddish and bedeviled by contradictions

They declared management theory “guilty” on all charges in various degrees, and went on to identify the root cause of the problem as an “…intellectual confusion at the heart of management theory; it has become not so much a coherent discipline as a battleground between two radically opposed philosophies. Management theorists usually belong to one of two rival schools. Each of which is inspired by a different philosophy of nature; and management practice has oscillated wildly between these two positions.” They went on to identify the two schools as scientific management on the one hand and humanistic management on the other, concluding that “This, in essence, is the debate between ‘hard’ and ‘soft’ management.”

Management Is The Battleground: Judgment or Technique?

It’s time to identify this intellectual confusion as not just being in the discipline of management but in the human subjects in their organizational context. It’s time to recognize that our fundamentally divided nature is the essence of our humanity and that it is their integration, the practical weaving together of irreconcilable opposites, the ‘hard’ and the ‘soft’, that is the very warp and woof of our existence.

In management these tensions are familiar; means and ends, quantity and quality, exploitation and exploration, calculation and judgment, individual and group, performance and learning, detachment and immersion, mechanical and organic and so on and on. All these strains come together in the debate over the extent to which management is a hard, technical-based practice or a softer, judgment-based practice.

The proponents of technical-based practice believe that the essentials can be conveyed by means of explicit rules, formal technical procedures and general abstract principles, which are then “applied”. They contend that it is the program or technique that produces the change. Judgment-based practitioners, on the other hand, emphasize the practical, situated judgment of the practitioner. They maintain that it is the person, the one who “cares”, who produces the results.  It would seem obvious that management is a mixture of both the technical and the practical and the “right” mix varies from situation to situation. Nevertheless, ever since the end of World War II, the Anglo-American emphasis has been on management as a hard, technical-based practice with universal application. In its aspiration to create a science of management it has championed what Peter Drucker called a “Cartesian world-view”. The Cartesian world-view is a single-minded one that denies our intrinsic double nature. In management, we know it as, “If you can’t measure it, you can’t manage it”, a comment often wrongly attributed to Drucker. Managers are seen as detached observers and rational actors making rational choices. It has stressed means over ends, encouraged efficiency over creativity, and short-term performance over sustainability. And, like all approaches that treat the long run as a series of short terms, it has worked, but with declining effectiveness.

The Scale of the Crisis

Now, after seventy years of economic prosperity on a scale unparalleled in history, all the long-neglected ‘soft’ halves of the management dualities seem to be returning with a vengeance. The obsession with means at the expense of ends has resulted in a profound loss of purpose and meaning. The pursuit of efficiency and the inattention to creativity has abetted a secular decline in productivity and produced a lack of engagement on the part of employees. Most seriously, the preoccupation with short-term performance has led to a disregard for sustainability.  This time, there is a real fear that new digital technology will not bail us out as industrial technologies have in the past.

The problem is a serious one, akin to institutions that, pleading poverty, have allowed their social, political and physical infrastructures to run into the ground. Eventually, the long-deferred bills come due and significant issues and the efforts needed to address them can no longer be avoided.

In management, our challenge is to revitalize management’s long-neglected ethical and philosophical roots. Peter Drucker had hoped that a process perspective embracing purpose, growth and development would replace the Cartesian world-view. Unfortunately, he may have underestimated the resilience of a self-sealing framework that believes that science has made philosophy irrelevant and is intolerant of alternative perspectives. Despite the clichéd mantra of the need to think “out of the box”, the taken-for-granted assumptions out of which the large Cartesian box is constructed remain largely unexamined. There is philosophical ferment on the fringes of management but little sign of change in the core.

We need a larger, enhanced worldview that recognizes the importance of context, history, and narrative in the practice of management. The Cartesian world-view is not  “wrong”, but neither is it universally applicable.  As a result, it has been misused and over-applied.

Embracing Contradictions

As Micklethwait and Wooldridge suggest, we don’t need theories that contradict each other but we do need theories that embrace contradictions. We need to do the hard work to recover a practical wisdom that will acknowledge our dialogical nature and recover the creative “both…and” tension between the ‘hard’ and the ‘soft’. We need a more critical stance toward our theories, accepting as the Greek philosophers contended many centuries ago, there are many ways of knowing, but no certain knowledge of anything. There is no such thing as a detached, objective observer – no view from outside of space and time – not even in the natural sciences, let alone the human disciplines. Systems scientist West Churchman made this point well, “Instead of the silly and empty claim that an observation is objective if it resides in the brain of an unbiased observer, one should say that an observation is objective if it is the creation of many inquirers with many different points of view.” In management objectivity is not a position; it is an achievement. It is the view from everywhere.

Managers who act only as detached observers cannot produce objectivity in this sense. The creation of a view from everywhere demands that managers are immersed participants. And the difference between detached observers and immersed participants is empathy, one of the key ingredients of what we call judgment. This is the capacity, in Isaiah Berlin’s words, “…for integrating a vast amalgam of constantly changing, multicoloured, evanescent, perpetually overlapping data, too many, too swift, too intermingled to be caught and pinned down and labeled like so many individual butterflies. To integrate in this sense is to see the data (those identified by scientific knowledge as well as direct perception) as elements in a single pattern, with their implications, to see them as symptoms of past and future possibilities, to see them pragmatically – that is in terms of what you or others can or will do to them, and what they can or will do to others or to you…. Above all this is an acute sense of what fits with what, what leads to what; how things seem to vary to different observers, what the effect of such experience upon them may be; what the result is likely to be in a concrete situation of the interplay of human beings and interpersonal forces…”

How do we develop such capacities in individuals? For those who view management as a technical-based practice, there is little need for judgment. The solution is a capacity for logical thought and calculation produced by ‘education’, where education is seen as the conveyance of technical skills, rules, and principles. It is a finite, instrumental activity with a beginning and an end. A judgment-based practice, on the other hand, views the development of the whole person as critical. Hence the German concept of Bildung, a process of growth and development in which a person learns the ways of the world and comes to terms with the need for both self-fulfillment and the social roles they must play. There is no direct English equivalent of Bildung, another reflection, perhaps, of how Cartesian and instrumental our world-view has become. Bildung is intrinsically valuable, a process of cultivation, a journey without beginning or end in which people are stretched to their limits to realize their potential. Bildung is the journey; education marks the stations along the way. Of course, we need them both, but we have to get the priorities right.

Perhaps future Drucker Forums can show us the way…

About the author:

David K. Hurst is a management author, educator, and consultant. His latest book is The New Ecology of Leadership: Business Mastery in a Chaotic World (Columbia University Press 2012).