It’s not exactly the easiest set of flights between Victoria, British Columbia and Vienna, Austria, but I’d travel twice the distance to take part.
The Global Peter Drucker Forum is one of those rare conferences where one believes change might actually occur. That’s why I’m here. That’s why I’m up at 4:30am Vienna time, writing these words.
The sub-plot to this year’s conference is “The Great Transformation: Managing our Way to Prosperity”. It couldn’t be more blunt. It couldn’t be more timely.
Our organizations – for-profit, not-for-profit or government – are in dire need of a transformation. One might argue the opportunity is ‘great’. One might also argue we need a clear path toward a different kind of prosperity, one I like to refer to as “purpose with profit“.
In the lead up to this year’s conference, I was asked by Steve Denning (I know, Steve Denning!) if I wanted to a) speak at the conference and b) work with him on a position paper outlining our hopes and dreams for the Drucker Forum itself.
In the paper, we pose three questions:
- Should firms make the shift from the goal of maximizing shareholder value as measured by the current stock price to a principal focus on adding value to those for whom the work is being done?
- Should organizations make the shift from the practices of hierarchical bureaucracy to the collaborative leadership and management practices of the Creative Economy?
- Should organizations make a shift from metrics that reflect narrow financial goals to metrics that reflect contributions to prosperity of individuals, organizations and society, for achieving both purpose and profit?
Maybe it’s the jet lag and the fact it’s still Wednesday where I come from (as opposed to Thursday morning as I’m typing) but in all honesty, I not only want those questions answered from above, I’d like to see action taken.
Since the early 1970’s, we have witnessed not only the fundamental collapse in the principles of an organization (from an equilibrium with stakeholders to a myopic fixation on shareholders) we have instituted leadership & management practices that define ‘shock and horror’ if not ‘shock and awe’.
We should not be proud.
In fact, we ought to be frightened.
I am the proud father of three young goats (Claire is 11, Cole is 9 and Cate is 7) and if I ask for anything from the Drucker Forum 2014 — if there is an altruistic hope I yearn for — it is to create the conditions that bring balance back to our organizations. This is “the great transformation” required today. I do not want to saddle my children with what has become a societal norm in today’s organization. That norm that oozes out of any sort of organization is hierarchical, closed, fanatical for profit, and disdain if not ignorance for the future of humanity.
It was none other than Peter Drucker who once wrote, “To know what a business is, we have to start with its purpose. Its purpose must be outside of the business itself. In fact, it must lie in society since business enterprise is an organ of society. There is only one valid definition of a business purpose: to create a customer.” (The Practice of Management. Peter Drucker. 1954. HarperCollins)
Fellow Canadian and Drucker Forum speaker Roger Martin wrote in his book Fixing the Game, “We must shift the focus of companies back to the customer and away from shareholder value. Companies should place customers at the center of the firm and focus on delighting them, while earning an acceptable return for shareholders.” (Fixing the Game: Bubbles, Crashes, and What Capitalism Can Learn from the NFL. Roger Martin. 2011. Harvard Business Review Press.)
I am wrapping up my next book and I thought it would be fitting to include my definition of the purpose of an organization. At the risk of attempting to outdo several literary and leadership giants, might I suggest the following:
“An organization’s ideal is to delight its customers through an engaged and purpose-focused workforce, acting ethically within society while delivering just profitability.”