Peter Drucker— Chapter 2, Leadership is a Foul-Weather Job

Chapter 2— Leadership is a Foul-Weather Job

Fortunately or unfortunately, the one predictable thing in any organization is the crisis. That always comes. That’s when you do depend on the leader.

The most important task of an organization’s leader is to anticipate crisis. Perhaps not to avert it, but to anticipate it. To wait until the crisis hits is already abdication. One has to make the organization capable of anticipating the storm, weathering it, and in fact, being ahead of it. That’s called innovation, constant renewal.

The lesson for leaders of non-profits is that one has to grow with success. But one also has to make sure that one doesn’t become unable to adjust. Sooner or later, growth slows down and the institution plateaus. Then it has to be able to maintain its momentum, its flexibility, its vitality, and its vision. Otherwise, it becomes frozen.

Non-profit organizations have no “bottom line.” They are prone to consider everything they do to be righteous and moral and to serve a cause, so they are not willing to say, if it doesn't produce results then maybe we should direct our resources elsewhere. Non-profit organizations need the discipline of organized abandonment perhaps even more than a business does. They need to face up to critical choices.

The starting point is to recognize that change is not a threat. It’s an opportunity.

Changes in Mind-Set and Mentality— The lesson is, Don’t wait. Organize yourself for systematic innovation. Build the search opportunities, inside and outside, into your organization. Look for changes as indicators of an opportunity for innovation.

First, organize yourself to see the opportunity. If you don't look out the window, you won’t see it.

Then, to implement the innovation effectively: the most common mistake± the one that kills more innovations than anything else— is the attempt to build too much reinsurance into the change, to cover your flank, not to alienate yesterday.

Next, the problem of organizing the new: It must be organized separately. If you put new ideas into operating units the solving of the daily crisis will always take precedence over introducing tomorrow. So when you try to develop the new within an existing operation, you are always postponing tomorrow. It must be set up separately. And yet you have to make sure the existing operations don't lose the excitement of the new entirely. Otherwise, they become not only hostile but paralyzed.

The Innovative Strategy— Successful innovation finds a target of opportunity. Somebody who is receptive, who welcomes the new, who wants to succeed and, at the same time, has enough stature, enough clout in the organization so that, if it works for him or her, the rest of the organization will say, Well, there must be something to it.

If you plan first and then try to sell, you’re going to miss the important things. But you also waste years of time. Selling has to be built into planning, and that means involving the operating people. But don’t forget one thing: everything new requires hard work on the part of the true believers— and true believers are not available part time.

How to pick a leader— First I would look at what the individuals have done, what their strengths are. The first thing to look for is strength— you can only perform with strength— and what they have done with it.

Second, I would look at the institution and ask: What is the one immediate key challenge?

Then I would look for character, or integrity. A leader sets an example, especially, a strong leader. He or she is somebody on whom people, especially younger people, in the organization model themselves.

In the non-profit agency, mediocrity in leadership shows up almost immediately. One difference clearly is that the non-profit has a number of bottom lines— not just one…in non-profit management, there is no such one determinant. You deal with balance, synthesis, a combination of bottom lines for performance.

…the non-profit executive has a multiplicity of constituencies— each of which can say no and none of which can say yes. The multiplicity of constituencies is reflected in your boards, your trustees, who are likely to be intensely involved in running the agency.

You can’t be satisfied in non-profit organizations with doing adequately as a leader. You have to do exceptionally well, because your agency is committed to a cause. You want people as leaders who take a great view of the agency’s functions, people who take their roles seriously— not themselves seriously.

Your Personal Leadership Role— The new leader of a non-profit doesn’t have much time to establish him/herself. Maybe a year…the role has to fit you…the role you take also has to fit the task…the role has to fit expectations.

You have to two things to build on: the equality of the people in the organization, and the new demands you make on them.

The leaders who most effectively, it seems to me, never say “I.” They don’t think “I.” They think ”we”; they think “team.” They understand their job to be to make the team function. They accept the responsibility and don’t sidestep it, but “we” gets the credit. There is an identification (very often, quite unconscious) with the task and with the group. This is what creates trust, what enables you to get the task done.

As a leader you are visible; incredibly visible. And you have expectations to fulfill…You are constantly on trial.

Most organizations need somebody who can lead regardless of the weather. What matters is that s/he works on the basic competences.

1) As the first such basic competence, I would put the willingness, ability, and self-discipline to listen. Listening is not a skill; it’s a discipline.

2) The second essential competence is the willingness to communicate, to make yourself understood.

3) The next important competence is not to alibi yourself. We either do things to perfection, or we don’t do them. We don’t do things to get by. Working that way creates pride in the organization.

4) The last basic competence is the willingness to realize how unimportant you are compared to the task. Leaders need objectivity, a certain detachment. They subordinate themselves to the task, but they don’t identify themselves with the task. The task remains both bigger than they are, and different.

When effective non-profit leaders have the capacity to maintain their personality and individuality, even though they are both totally dedicated, the task will go on after them. That is the hallmark of the truly effective leader, who doesn't feel threatened by strength.

What attracts people to an organization are high standards, because high standards create self-respect and pride.

Most leaders I’ve seen were neither born nor made. They were self-made. We need far too many leaders to depend only on the naturals. It’s that willingness to make yourself competent in the task that’s needed to create leaders.

The Balance Decision— One of the key tasks of the leader is to balance up the long range and the short range, the big picture and the pesky little details…the balance between concentrating resources on one goal and enough diversification.

The even more critical balance, and the toughest to handle, is between being too cautious and being rash….timing— and this is always of the essence.

I’ve seen more institutions damaged by too much caution than by rashness, though I’ve seen both…know your degenerative tendency and try to counteract it

…the balance decision between opportunity and risk. One looks at the decision: Is it reversible? And what kind of risk is it? The one asks: Is it a risk we can afford? Or the trickiest of them all, the risk we can’t afford not to take…The balance decisions are what we need non-profit leaders for, whether they are paid or volunteer.

The Don't’s of Leadership— Effective leaders have to spend a little time on making themselves understood.
Don’t be afraid of strengths in your organization…you run far less risk of having pople around you want to push you out than you risk by being served by mediocrity.

Don't hog the credit.

Don’t knock your subordinates. A leader has responsibility to his subordinates, to his associates.

Keep your eye on the task, not on yourself. The task matters, and you are a servant.