The Great Transformation

Richard Straub

Richard Straub is Associate Director Corporate Services EFMD and President of the Peter Drucker Society Europe.

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Richard Straub on why, with gigantic changes in society, managers will be of pivotal importance for shaping the future.

We are at the beginning of a set of gigantic changes in society –for better or for worse. The future is open; nobody knows what it will hold. One thing we know says Richard Straub: on this stage, managers will surely be of pivotal importance for shaping it.In his landmark book Innovation and Entrepreneurship, Peter Drucker quotes Thomas Jefferson: “Every generation needs a new revolution.” But Drucker quickly makes clear that, as much as he admires Jefferson, this particular comment is off the mark.

In truth, Drucker notes, most of the revolutions that we have witnessed in recent history failed to deliver on what they had promised. As Alexis de Tocqueville,
the French philosopher and political theorist, pointed out, revolutions do not demolish the prisons of the old regime; they tend to enlarge them.

The conditions that lead to revolution in the first place are typically oppressive leadership, the bankruptcy of ideas and institutions and, above all, a failure by society to renew itself. Achieving large-scale social change without going through
the upheaval of a violent revolution is obviously the better option. The term “transformation” well describes this preferable path.

Hence, a key question that faces us today is whether we have the regenerating capacity in the Western world to achieve a transformation for regaining growth and prosperity as opposed to moving inexorably toward social and economic decline
– and, quite possibly, facing the wrenching trauma of a citizens’ revolt along the way.

Dangerous trends
Evidence of the need for change is strong. A number of factors have converged to make the picture especially daunting. Taken together, they indicate that we are heading towards decline rather than prosperity:

Economic stagnation and financial instability
Even though some indicators have improved since the global financial meltdown of 2007/2008, the structural problems that are bogging down our economies are by no means resolved. American economist Larry Summers talked in a recent interview about the probability of secular stagnation as a “base case” for decision makers. In addition the debt crisis in developed economies severely limits the ability of governments to provide further stimulus.

For the full article, you can view the PDF or listen to the podcast.

 

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