Leadership resilience from the train 🚆
Five take-aways from the Peter Drucker Forum
It is 06:00 am, and I jolt awake by a loud voice. It is the train conductor. "Good morning, everyone; there are heavy snowy conditions. We are currently in Nürnberg, and it is unclear when we will resume our trip. We won't have any more information until 08:00."
I am in a sleeper cabin in the Nightjet, a direct train from Vienna to my hometown of Utrecht (The Netherlands). It left at 20:00 and is scheduled to arrive around 09:30 the next morning.
I decide to turn around to try to catch a bit more sleep. But then, I suddenly realize where we are. Nurnberg. I check the timetable. We should have left Nurnberg five hours ago! This is going to be a long day...
I fall asleep. About an hour later, I wake up and take a quick shower. It's so nice to have my own private cabin on the train. I put on some fresh clothes, and I'm looking forward to breakfast, which they're supposed to serve soon.
Then the conductor announces "Hello everyone, we've just heard that we won't leave this station until 12:00, if we leave this station at all. We recommend looking into alternative forms of transport to reach your destination. In about 30 minutes, a train to Köln will depart at the track opposite this one."
I pack my bag and get on the other train. Several hours later, and after one more transfer, I arrive home at 17:30. The total trip was almost 22 hours.
You might be thinking, why am I taking a 22-hour train, if I could also have taken a 1,5 hour flight? First of all, it was supposed only to take 13 hours - of which I would be asleep at least half of it. And many flights were also canceled due to the snow. But I actually didn't mind the delay at all. Here's why.
As you know, I'm working on my next book. And I've discovered that it is the optimal writing environment for me. No meetings, no distractions. Just me, my laptop, a terrible internet connection, and a beautiful view. And, of course, it is much better for the planet too. In the next weeks, I'll also travel to London, Oxford, Berlin, and Poznan (Poland) for speeches and workshops - all by train. Yay!
I’ve changed the working title of the book to this:
Twelve Habits of Highly Adaptive Leadership Teams
Better decisions, effective meetings, and faster results.
I will release the first four chapters at the beginning of next year. 🙏 Do you want to help me out? Ping me if you 1. would like to be a beta reader or 2. if you are a leadership team member, and I can interview you.
So what was I doing in Vienna? I visited the Global Peter Drucker Forum—a conference on the practice of management. This year's theme is 'Creative Resilience - leading in an age of discontinuity.'
Peter Drucker (1909-2005) was one of the first thought leaders to write extensively on the practice of management. He was ahead of his time.
Some of my favorite quotes from him:
“Culture eats strategy for breakfast.”
"Only three things happen naturally in organizations: friction, confusion, and underperformance. Everything else requires leadership."
"Management is doing the things right; leadership is doing the right things"
"So much of what we call management consists of making it difficult for people to work."
"If you want something new, you have to stop doing something old."
"The most important thing in communication is hearing what isn't said."
"There is nothing quite so useless as doing with great efficiency, something that should not be done at all."
There were many interesting speakers and panels on "leading resilience" at the conference. In this newsletter, I'll share five takeaways from the conference.
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1. EF and Haier: Distributed organizational structures
EF and Haier are two huge organizations with a radically decentralized structure ‘built to flex’. They were on a panel together.
EF Education First, a world leader in international education, has over 50,000 employees and is divided into hundreds of independent business units supported by a very small 'core'. Three insights from Maria Norrman (Global Chief of Staff, EF):
People can make decisions with impact without needing to "take it up the chain and getting killed for it later." However the high level of autonomy is not for everyone.
There is no big central HR function: our managers do the hiring/firing. That core responsibility can't be outsourced to HR.
The decentralized business units reinvent the wheel quite often, but they are okay with that. We accept that as a trade-off of our model.
Haier is the largest growing appliance manufacturer in the world, has over 100,000 employees and is organized into 4,000 micro-enterprises. Three insights from Yannick Fierling (CEO Haier Europe ):
Haier has transformed multiple times and is now 'ultra flat.' We've given the steering wheel to the micro-enterprises and strive for 'zero distance between the people and the customer'.
People have the possibility to own and drive their own business, and that is highly attractive for new hires. When you get skin in the game, its entrepreneurial energy becomes contagious.
The CEO and other senior leaders are seen as a 'support function'.
Both companies see their structure as a core competitive advantage. It allows them to attract and retain talent that others are jealous of. And it enables them to evolve their business model faster than their competitors.
2. Pfizer: Extreme acceleration during COVID
An inspiring story shared by Sally Susman, EVP at Pfizer. "Our problem is not that we aim too high and miss. But that we aim too low and hit."
"We made the COVID-19 vaccine in 8 months. Normally, it would have taken us 12 years! We had to do everything at the same time. We started manufacturing before the approval was completed.”
“We couldn't afford the usual process where we had one layer of bosses talking to another layer of bosses. Because we were all working remotely, we could communicate quickly across layers. We could only meet this timeline by crushing our own bureaucracy."
3. Walmart: The Business Case for Sustainability
Many companies face challenges when it comes to convincing investors, executives, and shareholders to support the necessary investments to enhance the sustainability of their business. But Walmart is making bold moves. They are investing many millions in Project Gigaton. They aim to reduce or avoid one billion metric tons (a gigaton) of greenhouse gases from their value chain (including emissions by its thousands of suppliers) by 2030.
Why? What's the business case?
Well, they realized that if they stayed on this course, the resulting climate change would make everything more expensive. Consumers will need to spend more on their energy bills and have less available for Walmart.
Jennifer Tharp shared this story on a panel about ESG. Another insight from the panel is that businesses that are doing 'greenwashing', or nothing at all, will struggle to attract and retain the future talent they desperately need.
4. Fukushima: Leadership in a crisis
Yves Doz, shared this remarkable story. When the nuclear power plant in Fukushima was hit by an earthquake, and resulting tsunami, the leader in charge, desperately applied the emergency procedure book. He insisted on following the rules, but the rules weren't made for the situation - with disastrous consequences.
Not many people know that 10 kilometers south, there was a sister nuclear plant. It also got hit by the tsunami and lost all power. Its senior leader kept his head cool and quickly realized that it wouldn't make sense to follow the procedures.
He involved his engineers in making sense of the situation. A few of them went into the buildings and figured out they urgently needed to find a way to power the cooling system. This became the number one priority.
There was only one problem, the closest place with power was nine kilometers away. Laying a new cable would usually take a month with the help of heavy machinery, but machines were unavailable. They had to do it by hand, every roll of 200m weighing 1,000 kilos. The 400 employees did it within 24 hours.
They were able to power the cooling system, only two hours before the reactor would reach critical levels and likely explode.
A more elaborate and frankly more accurate version of the story can be found in this HBR article How the Other Fukushima Plant Survived.
The story reminds me of the concept of 'intelligent disobedience,' on which I wrote a newsletter:
5. Amazon’s resource agility
Amazon is capable of swiftly allocating resources and manpower, allowing them to react instantaneously to market opportunities. "While most organizations can make only incremental changes during their annual budget planning exercise, Amazon is able to grow or shrink a department from 80 to 800 and vice versa, in a matter of weeks. When they spot an opportunity, they deploy dozens of teams against it." A great insight shared by Rita McGrath. Read more here.
A photographer took this photo of me, photographing the beautiful venue. 😅
Thanks for reading!