As the Drucker Forum prepares its initiative to develop the ‘Next Management,’ it could be useful to look back to 2008 when a similar initiative known as “Moonshots for Management” was conducted by Gary Hamel’s Management Lab. The initiative, which involved 35 of the most distinguished management experts and executives, set out to “re-imagine management for the 21st century.” The report was published in HBR in February 2009 here and here.
Now in 2024, some 16 years later, management is still broken—hence, the Drucker Forum’s new ‘Next Management’ initiative. Here are 9 insights from the 2008 Moonshots initiative that could help make the Drucker Forum’s ‘Next Management’ initiative more successful.
Insight #1: Recognize The Gravity Of The Challenge.
On the plus side, the Moonshots initiative articulated the challenge for management in a way that still looks relevant today: “How in an age of rapid change do you create organizations that are as adaptable and resilient as they are focused and efficient? …How in a creative economy where entrepreneurial genius is the secret to success do you inspire employees to bring the gifts of initiative, imagination, and passion to work every day?” The fact that most big firms still face these problems, along with the new challenges of AI, underlines the gravity and the urgency of the challenge.
Insight #2: Get The Right Definition Of Management.
The Moonshots initiative defined management as a system of “structures, processes, and techniques used to compound human effort—have helped to power economic progress.” That led the Initiative in an unpromising direction. That’s because “systems, processes, and techniques” by themselves are inherently inert, uninspiring, and deadening, By themselves, systems cannot generate the initiative, imagination, passion that the initiative aspired to. Unless the system is driven by the right human mindsets, goals, values, and culture, a system of processes and techniques will remain inert, disengaging, and inhibiting and stifling initiative and creativity. It is not that systems, methods, processes and frameworks aren’t important. They are. But when human goals and values are omitted from the definition of management, there is a significant risk of achieving arrangements that undermine human values and create a disengaged workforce—which is where many big organizations are today.
Insight #3: Seek the Right Kind Of Solutions.
The inappropriate definition of management led directly to inappropriate solutions: Thus 18 out of the proposed 25 moonshots concerned adjusting the system, processes, tools, and techniques. The problem is that management aspiring to have employees bring the gifts of initiative, imagination, and passion to work every day cannot achieve that through systems, processes, tools, and techniques. It can only be attained by subordinating the system, processes, tools, techniques, and frameworks to human values, mindsets, caring, feeling, and culture that firms can inspire energy, enthusiasm, creativity and innovativeness.
Insight #4: Use An Appropriate Change Model.
The Moonshots initiative was inspired in part by the U.S. National Academy of Engineering, which had proposed 14 grand engineering challenges for the 21st century. This led the Moonshots group to begin its work by compiling a roster of 25 challenges that managers should strive to achieve. The problem was that management is different from engineering. That’s because if you solve a problem in engineering, it tends to stay solved. Puzzles are independent. Organizations are different. Organizations are complex adaptive systems that robustly resist change: as a result, solving a problem in one part of an organization (say, the budget) often results in the change being thwarted by counter-actions in other parts of the organization. Management problems can only be solved holistically.
Insight #5: Learn From Conversations With Outliers.
In May 2008, the Moonshots group had the advantage of a lengthy interview with a firm that was being run on totally different lines from what the participants expected. Google CEO Eric Schmidt explained how Google was succeeding by removing most of the key components of the traditional system of processes, tools, and structures—eliminating managers, techniques, processes, controls, hierarchy, and systems—see Appendix 1.
Schmidt explained that Google had “liberated” its staff from the traditional system of management, thereby enabling creativity and innovation in an exciting, energizing, playful, uplifting, highly productive, socially useful, and profitable workplace.
In the conversation, the Moonshots participants questioned whether Google’s approach to management could work, whether it could last, and whether it had relevance to other organizations. Google was not mentioned in the Moonshots final report, although the conversation with Schmidt was made available on YouTube here. Google of course did succeed. Google became a household word and its market capitalization increased more 8 times over the next decade.
An insight for the Drucker Forum’s “Next Management’ would be to use any “outlier” firms that it encounters as a learning opportunity, even if it appears to flout current conventional wisdom or its expectations.
Insight #6: Examine The Financial Facts.
The Moonshots initiative took place during the worst financial crisis in 80 years, with some of the most famous firms being crushed or bailed out, such as Citibank, Bear Stearns, GE, GM and Ford, among many others. And yet there is no mention of finance in the Moonshots report. (An analogy would be a report today on beach planning in Florida without mentioning Hurricanes Helene and Milton.) Paying attention to financial data could also have helped to reveal the emergence of Amazon, Apple and Google.
Insight #7: Recognize Customer Centrality.
The Moonshots initiative was obviously aware of the Internet, as its very meeting took place in Silicon Valley. Yet it is not obvious that the Moonshots group grasped one of the profound consequences of the Internet: the new centrality of the customer in management. Thus the internet gave first, to firms, new possibilities for innovation, and then to customers, more choices, and finally to firms again, the potential of new business models that built on network effects. The Moonshots initiative did not identify the centrality of the customer, which was to become ever more crucial in the fastest growing firms in the coming years.
Insight #8: Spot Emerging New Management Paradigms.
Already in 2008, the fast growth of Google, Apple and Amazon was an early sign that a new paradigm was emerging. Google was thus the opposite of how most private firms were being run with goal of making money, with processes, hierarchy, and controls, as the set of tools to produce outputs.
Google was a sign of a fundamentally different paradigm of management that was beginning to emerge involving a mindset or goal of creating value for other human beings, through a focus on customers, empowerment of staff, and horizontal networks rather than hierarchy, leading to process driven-outcomes. The paradigm is more obvious now in 2024, when 20% of the fastest-growing firms run in this way are now worth half of the entire S&P500. The Drucker Forum initiative should be on the lookout for any new management paradigm, as a result of AI.
Insight #9: Fix The Philosophical Foundation Of Management.
The Moonshots report repeatedly noted that something was amiss with the fundamental philosophy of management. The report offers the improbable suggestion of “drawing lessons from such fields as biology and theology, and from such concepts as democracies and markets.” The source of the problem may lay closer to home: Frederick Taylor’s 1911 dictum “In the past Man has been first; in the future the System must be first,” which continued to dominate management for more than a century.
The social reality of today is that few people want to live in a world where they are controlled by a system. It could therefore be time for the Drucker Forum’s Next Initiative to declare unambiguously, that in future human mindsets, goals, values, and aspirations must come before the system.
That would be a direction that is not just morally correct, but a direction in which we need to go, because it is not only more profitable and engaging, but also joyful and inspiring and playful and beautiful. Above all, it is a direction in which young people can recognize as leading to a world in which they might want to live.
And read also:
How The World’s Fastest Growing Firms Are Upending The Concept Of Management