What truly matters in this age

<The piece below is one I contributed to the November issue of Maeil Business Newspaper's "Luxmen" magazine>

It's a recession where the end of the tunnel is hard to see. It's also a time of change, where companies that were doing well can crash in an instant. What is the key that takes a business to success in a time like this?

 

Gary Hamel, a professor at London Business School famous for his book "The Bees and the Guerrillas," has laid out the five issues that will decide the fate of business. Amid the flood of important new concepts — social media, big data, virtual collaboration, open innovation, sustainability — Hamel pulls out five that are more fundamental: values, innovation, adaptability, passion, and ideology.

 

First, Value. Hamel points out that trust in large organizations like big corporations has recently cratered, and argues we urgently need to rebuild the ethical foundations of capitalism.

 

"We long for, how to put it, a more generous and more tolerant capitalism. A system that sees us as more than mere consumers; a system that distinguishes maximizing consumption from maximizing happiness; a system that does not sacrifice the future for the present; a system that treats the earth's natural resources as finite." (p. 71)

 

Innovation is important too. Hamel says that innovation is what lets us exist, prosper, enjoy happiness, and open up the future. Innovation is also the only way out of a gloomy economy. For innovation, Hamel advises dissecting and analyzing Apple. Apple is the standard-bearer of innovation, reshaping not just one sector but many — computers, music, retail, mobile phones, software, media, and publishing. What is the secret of Apple's success? According to the author, it is the relentless realization of the philosophy "Think different." To do that, you have to release passion, not just reason; lead, not imitate; aim not at customer satisfaction but at surprising customer experiences. You have to become illogical rather than practical, innovate constantly rather than only when needed, agonize over tiny details, and feel like an artist rather than an accountant.

 

Hamel also stresses Adaptability. Just as the spring of inspiration and passion tends to unwind bit by bit over time, companies that fail to change gradually lose their place. Hamel compares corporate adaptability to the human autonomic nervous system.

 

"When giving a talk to a large audience, the adrenal glands naturally step up adrenaline secretion. And the moment you see an attractive person, your pupils reflexively dilate... Like that, the autonomic nervous system adapts to change without much shock, automatically, naturally, and reflexively." (p. 160)

 

Passion is another key issue of our time. Hamel emphasizes that what shakes off the stale in business and sparks inspiration is passion. Only organizations that find the secret to waking up the human spirit can succeed. For this, Hamel stresses that the people must come before the organization. As in open-source software projects, you have to see members as voluntary agents and treat the organization, not the individual, as the "means." Only then can a "community of passion" be built.

 

Ideology matters too. The ideology of bureaucracy and control, he stresses, is ready for the curtain call; we've reached an era that needs a management philosophy of autonomy and self-determination.

 

"Is there a management philosophy that can replace the ideology of control? Naturally, it is freedom. People grow and develop only when they do work they find interesting and can loyally and wholeheartedly devote themselves to the organization on their own initiative. Organizations that give humans that kind of freedom are needed now more than ever." (p. 311)

 

These five questions Hamel raises give us starting points for thinking and for action on "what truly matters now."