May 1st 2018

Management ‘Gurus’ and Global Risk Agility

by Daniel Wagner

CEO of Country Risk Solutions and co-author of Global Risk Agility and Decision Making.


Management “gurus” have been beating some familiar drums over the past several decades, encompassing some recurring themes, such as the wonders of entrepreneurialism and the benefits of globalization. Many such gurus are telling many of us what we already know – such as that businesses which innovate will have the first mover advantage, or that, in order to grow, organizations should expand into frontier markets. When will organizations demand that the gurus tell them something they do not already know?

The authors of such books as “In Search of Excellence”, “The 7 Habits of Highly Effective People”, and “The One Minute Manager” are, in the end, selling common sense. Their messages resonate because individuals in business crave the ability to improve themselves, want to believe they have something no one else has, and desire to possess hidden knowledge about how to make more money. Where is real value addition in that? Are these gurus merely masterful at packaging what we already know into something that appears to be a subject we knew nothing about? When was the last time you heard a management guru truly blow you away with insight and wisdom?

Given that we are living in an era of disruption, should it not be the case that these business gurus are themselves being disrupted, and promote the art of disrupting? Yes, we understand that businesses operate in a competitive landscape (they always have and they always will), but why isn’t more time being spent talking, for example, about the impact of the consolidation process currently under way in industries ranging from airlines to food production to technology? Rather than becoming a more competitive landscape, the opposite has become true in many sectors of the global economy – and the companies engaged in that consolidation are generating record profits. Does this mean that all that talk for all those decades about being more competitive is just a bunch of bunk?

Consider also that, despite all the crowing about the importance and need for entrepreneurialism, the rate of new business creation has actually declined in the US since the 1970s. Why, despite all the billions of dollars spent on the pursuit of  entrepreneurialism since then, is that the case? Also, instead of enhancing organizational efficiency over the past several decades, many of the businesses that have embraced good governance have become sclerotic -- devoting enormous resources and clogging up approval processes to ensure they are doing the right thing the right way. Why are these types of issues not a primary focus of the gurus?

One could even argue that, in many cases, the very Kool-Aid businesses have drunk from the gurus over the years has contributed to preventing managers from thinking critically about the bigger picture, focusing instead on micro-level issues such as decision-making style, market-specific penetration, and quarterly financial performance. Businesses can get so caught up in short-termism and fine tuning that they may fall further and further behind the very curve they are trying so hard to stay in front of.

Since the business world has become so accustomed to relying on the gurus to tell them what to do, the gurus have an obligation to stop peddling the same old snake oil. Who is talking about how globalized the world was between 1880 and 1914 -- until war broke out and fascists subsequently determined the course of history -- and the parallels between then and now? Globalization always had a down side, and was never meant to last forever -- but the gurus chose not to talk about it. It is always just a question of time until economic nationalism reappears, but the gurus have done a poor job of addressing the nexus between economics and politics, and its impact on business, which is the real story.

If the business gurus want to do their brethren a real favor, they will address not only how to survive, but how to thrive, in this era of disruption. The benefits of entrepreneurialism, comparative advantage and globalization are yesterday’s topics. Today, global business is as much about having a foreign policy as it is about having a realistic approach toward corporate social responsibility. Current topics include how to anticipate change and create and maintain a defensive posture, creating products that contribute to the well-being of people, and wanting to do the right thing not because it is fashionable or profitable, but because of a desire to adopt a corporate culture that loudly proclaims what a company stands for.

The management gurus will only change their tune if the audiences that listen to them demand a different product mix. As the pace of technological change continues at a breathtaking pace and radical political change continues to define the new normal, instead of searching for excellence the gurus should be telling us not why organizations need to adapt, but what the cost of failing to adapt is. We should be learning less about ratcheting up the bottom line and more about getting to the finish line in one piece, and with a clear conscience. In this era of a clash between man-made and natural risk, achieving global risk agility is the key to success. Let us hope the gurus get the message.

 

*Daniel Wagner is CEO of Country Risk Solutions and co-author of Global Risk Agility and Decision Making.

This article was first published in the Sunday Guardian.

 


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