I recently spoke with Adrian Wooldridge, who is the author of Masters of Management: How the Business Gurus and Their Ideas Have Changed the World – for Better and for Worse. Wooldridge is the management editor and “Schumpeter” columnist of The Economist. He was educated at Balliol College, Oxford, and All Souls College, Oxford, where he held a Prize Fellowship. He was formerly The Economist’s Washington bureau chief and “Lexington” columnist. In this interview, he talks about how the field of management has changed over the past decade, the difference between management and leadership, and more.
How has the field of management changed in the past decade?
Management has been revolutionised by two great changes over the past decade. The first is the rise of the internet. A decade ago the internet was still a fancy reference tool and Google was still a start up. Today the internet is reorganising the world. The internet is not only spawning an entire ecosystem of new businesses. It is reshaping the way that even the most conservative companies organise their business.
The second is the rise of emerging markets. A decade ago we still referred (often pityingly) to the underdeveloped world. Today we regard the emerging world as a hotbed of growth and innovation. Investment houses are pouring money into the BRICs even as they despair about stagnating Europe. Multinationals are ‘offshoring’ research and development as well as manufacturing to India and Brazil.
Are all managers leaders? What’s the difference between management and leadership?
No: not all managers are leaders (and not all leaders are managers: some great leaders such as Winston Churchill have been hopeless everyday managers).
The great distinction between the two lies in the choice of direction: leadership is about choosing where to go while management is about choosing how to get there. Jack Welch was a great business leader because he changed General Electric’s strategic direction with his emphasis on being number one or number two in a business or getting out. A secondary distinction lies in inspiration: the best leaders not only set a direction but inspire their followers to strain every sinew in reaching their new destination. There is nothing second-rate about management: great leaders mean nothing without the nuts-and-bolts men and women who put their visions into practice and make sure that the trains run on time. Incremental changes can sometimes add up to big changes. But given the uncertainty of the current business world—the sudden gusts of change that blow from unexpected directions—leadership is more important now than it was say fifty years ago when ‘organisation man’ ruled the roost.
Can you name a few management gurus that you’ve been observing and explain how they have helped make change?
These astonishing changes of the past decade—the world remade by the internet and turned upside down by emerging markets—have changed the pecking order among business thinkers. You are probably more likely to find a mind-changing article in Wired than in the Harvard Business Review or from an Indian than from an American-first mid-westerner.
The business gurus that I pay most attention to come in two guises: geeks or third-world firstists. Christopher Anderson made waves with his book on The Long Tale (which argued that the world of niches is replacing the world of mass markets). The book has had a huge influence not only with high-tech companies but with other organisations (retailers for example) that are seeing their markets redefined by the internet.
I suspect that his work-in-progress on 3-D printing will also have a big influence (though there is a lot of work in this area). V.G. Govindirajan of Tuck Business Shool has produced exemplary work on ‘frugal innovation’ (the idea that the most interesting form of innovation in the emerging world is about radically reducing costs rather than adding more bells and whistles. This has had a huge impact on General Electric which is producing a new generation of ‘frugal’ medical products. John Hagel and John Seely Brown have produced equally fasinating work on how these ‘frugal products’ will send a wave of disruption through rich countries, as traditional producers are forced to cut costs dramatically or see their markets eaten up by emerging-market giants.
What will the new management gurus of the future look like?
The management gurus of the future will look more like the class of 2010 at CEIBS or the Indian Business School than the class of 2010 at Harvard Business School or Wharton. They will also look more like the class of 2010 at the Stanford School of Engineering than the class of 2010 at the Stanford Business School: white faces will give way to ‘faces of colour’ and classic business school types will give way to engineers and other sorts of geeks.
For the past century business thinking has been dominated by the United States. The bulk of the business cases have been about American companies. The bulk of the tools and techniques have been dreampt up by American managers. The driving assumption has been that if you don’t measure up to American standards—about how you organise your company or measure your performance—you are doing something wrong. That model was shaken by the rise of Japan but reasserted itself in the 1990s. It is now being shaken up even more thoroughly by the rise of a huge variety of emerging world companies. The business gurus of the future will come from emerging world—not just from India (which has cornered the market for the moment) but also from China, Indonesia, Turkey and Nigeria.
For the past century technology gurus have played second fiddle to strategy gurus (or even marketing gurus). Peter Drucker was less interested in technology than in the sociology of organisations. Tom Peters made little use of his training as an engineer in his voluminous writing. Technology is now at the heart of business thinking rather than an optional add on. Technology gurus are rewiring our thinking about organisations. And gurus from other disciplines face a stark choice: think deeply about what is happening in the world of the internet or face irrelevance.
Dan Schawbel, recognized as a “personal branding guru” by The New York Times, is the Managing Partner of Millennial Branding, LLC, a full-service personal branding agency. Dan is the author of Me 2.0: 4 Steps to Building Your Future, the founder of the Personal Branding Blog, and publisher of Personal Branding Magazine. He has worked with companies such as Google, Time Warner, Symantec, IBM, EMC, and CitiGroup.