Teach for America – Tomorrow’s Effective Leaders

Make more noise, be louder, push harder.

That’s the advice from feminist leader Gloria Steinman and civil rights leader John Lewis at this weekend’s Teach for America Alumni Summit, which drew 11,000 people.

The results Teach for America, their alumni, the enterprises they have launched, and their friends have accomplished is mind-boggling.  Thanks to Teach for America , students  who had been ignored  are  living dreams – completing college and breaking out of poverty.  Schools built by alumni are breaking levels of performance that were assumed impossible.  For example, Julie Jackson, the principle, at NorthStar Academy in Newark, has taken one of the worst performing schools in the state and is delivering results comparable to the best school in New Jersey.

Communities that had the poorest education standards in the country – New Orleans and Washington DC – are starting to rise from the dust, and even offering some lessons in what can be done right.   In Baltimore, a new generation of public officials is emerging – people who have lived in a classroom.   Colorado is passing promising legislation focused on teacher excellence after senators are visiting the TFA classrooms.

I would speculate that if we check out Facebook in 2020, TFA alumni will dominate the list of the most admired leaders, just as Peace Corps alumni did 30 years ago.

Across the country, teaching is getting renewed respect.  Teaching jobs are now some of the most sought after positions by the best performing college students.  TFA is the only institution that can consistently compete against Goldman Sachs and McKinsey for candidates and win.   Parents who demand excellence of their sons and daughters are no longer questioning their children’s decision to go into teaching.  President Obama and Secretary Arne Duncan recognize the new standards of possible.   And for me, a business-person, the number and scope of entrepreneurial ventures that have been launched on efforts as diverse as training principals to providing one-on-one mathematical teaching with computers is nothing short of Silicon Valley.

It is the synergy and focus within this group that is making these leaders, leaders extraordinaire.  As part of Teach for America, groups in a school meet and collectively learn from each other and mistakes, not unlike the Japanese education system.   At this conference, the number of formal and informal meetings trading ideas and helping each other was a community collectively solving problems and creating new possibilities for education in America.

TFA believes that good leadership will lead to good teaching –- if you know how to lead and manage your classroom, it will lead to achievement gains with your students, regardless of their race or socioeconomic status.  Effective leadership is creating a culture so that the impossible is possible.  That is what this group is doing individually and collectively in and out of the classroom.  The optimism, caring, commitment, and energy of the 11,000 people is contagious.

Teach for America’s challenge now is to scale fast without losing the  focus on putting their core members in the high-need and hard-to-staff places.   America’s challenge is that we can not afford not to. It is this community of 11,000 that have convinced me we will.

China Today

China Today: Beautiful, Stressed, and Optimistic

August 20, 2010

I am returning from three weeks in Chinese cities, with a sense of optimism about this thriving country—strained by its rapid economic growth, urbanization, and environmental challenges. China stands a good chance of creating a vibrant future for itself and contributing to the world.

My family and I were impressed by the kindness of Qingdao, the rage of Nanjing’s and Hangzhou’s future leaders at its corruption, and the indefatigable commitment we saw in Shanghai to preserve the past while pursuing the unique opportunity China faces today.

The Beautiful

Qingdao, a city of eight million, is a village, even though it is the size of New York. Visitors and strangers are welcomed with a warmth reminiscent of America’s small towns. So many people took care of us. For example, we had arranged to rent bikes for a week; when we arrived in our hotel lobby to pick up them up, we learned that each bike rental would cost 160 RMB a day, or $24. The bell captain told me that we could buy bikes for $75 each, so we decided to rent for only a day.

The next morning when we came down at 5:45 a.m. to go to our daily Tai Chi class, a bellman raced over to us and said,  “I came in early so you could use my bike,” as he gave the handlebars to my  teenage daughter. He was not angling for a tip; they are prohibited by law. He was taking care of us. He said, “If you want to use it tonight, I will walk home.  It is important that you enjoy your visit to Qingdao.”  That afternoon, we returned the bike to him.   The next morning, he was waiting for us again at 5:45.

Another example: I was waiting in a park as my daughter was busy working with the Tai Chi master.  An elderly woman was stretching nearby in Music Square, a large paved area on the shore.  She saw me watching and came over to invite me to stretch with her.  She spoke no English.   Over the next few days, I stretched with her every morning.  On our last morning, I said goodbye and she said, in English, “Keep stretching—important.”  She had found someone to teach her that phrase so that she could take care of me.

Yet another example: We were taking Mandarin lessons for a week. I was quoted a price and asked if I would pay in cash. I calculated the amount in RMB and brought it with me the next morning.  The third day, our instructor told me that his price had been in RMB, not dollars; I had overpaid by a factor of six. He gave me a cash refund and urged me to put it away.  After class, he escorted us to a taxi and paid the driver.

These acts of kindness happened many times every day. The people of this city, act like villagers.  It is a beautiful village. The kindness so many people showed toward us, and their comfort and confidence with helping us as Americans made me hopeful that China could one day be our country’s partner, rather than our rival.

The Stressed

As we sense from the U.S. media, China is not universally rosy. The rapid change that has so benefited the economy has also put traditional morality to the test, and in some instances it has failed. Corruption is now rampant. In both Nanjing and Hangzhou, I had opportunities to sit down with 24- to 30-year-olds, China’s future leaders, and ask about their lives. They were all proud to be Chinese and clearly excited to be part of a growing country.  Yet they spoke angrily about corruption  and the threat it poses to China’s survival.   One doctoral student decried the corruption in the academic world, the one place she had hoped would be corruption-fee.  She explained that except for professors over age 70, the faculty sold grades: on every exam, in every class. They wanted money.

A computer engineer who worked a second job as an on-line instructor, described with tears in his eyes the day he took his father to the hospital with pneumonia. He said that, had he not brought a wad of cash every day to pay the hospital staff, his father would have died.    He described with show the doctors who refused to treat other patients because they did not have that extra cash.

One articulate 27-year-old explained to me, “It is a balancing act.  Our job as citizens is to collectively push the government to do the right thing.” He added, “ In your country, the government regulates the corruption in the population.   Here, the population regulates the corruption in the government.”  He gave me an example. To get government support for hemophiliacs, citizens published reports comparing China to Taiwan in the treatment of hemophiliacs. The reports embarrassed the government, and they rapidly corrected the problem in the biggest, most visible cities. He continued, “We cannot push too hard, on too many places, or as individuals.  ”

These future leaders expressed the fear that the corruption may encourage young talent to flee.  Each one described friends who do not live in China because of the corruption, and will not return.   They all said that it is not clear that China can rid itself of corruption in critical sectors such as education and healthcare.  I heard that many government employees have sent their children to other countries or obtained for them alternative citizenship, so if corruption destroys China, they will have an escape route.

The Optimistic

Despite the dark clouds, China retains a rich heritage and fundamental values that may well carry it through.  The message was clear when I visited several companies, then wandered through the Chinese Pavilion at the World Expo. The message: China’s past and future are in harmony.   Its economic gains since it began opening itself to the world are its greatest pride.  The exhibit begins with a short video on the last 30 years—the shifts in living conditions, sizes of homes, and people’s optimism about their lives and those of their children.  It then moves to a hall of historic art. A wall 100 yards long displays a screen that looks like the Marauder’s Map from the Harry Potter films.

It is an image of an ancient scroll displaying village life on the day of the Qingming festival, which honors ancestors; but here, the characters and animals are moving. The images are projected from behind the wall, using state-of-the-art technology.   Other exhibits of Chinese treasures, also strove to integrate ancient values with current technology.  I continued to “The Land of Hope,” which emphasized homes, families, and communities. One film showed an apartment building with a basketball bouncing from home to home.  I saw hundreds of children’s drawings of their hopes; extensive material on creative education; a dialogue on urban planning—architecture, transportation, landscaping, and more. The last hall displays a vision of China’s future. It is loaded with inventions and ideas for a sustainable future: a fully functioning car that runs on photosynthesis; urban plans for streets beneath streets, with no stop lights; sustainable living with plants on the outsides of buildings, geo-thermal heating and cooling, rainwater collection on the roof and so on.  At the exit is an artwork that defines   “harmony,” like a symphony with, many instruments playing a common melody.  In harmony – socialism and capitalistic enterprises have resulted in one of the most sustained expansions in history.

One cannot leave China without optimism.   It is now the world’s second largest economy, having passed Japan while I was blissfully doing Tai Chi in Qingdao.   China leads the world in exports, having outstripped Germany this year, and has a military operation that is second to the United States in size. It is easy for Americans to fear China as an up-and-coming competitor. Yet I departed feeling optimistic that China will continue to be a great neighbor and friend, as well as a leading force in creating our common future.  The best thing we can do is help the individuals collectively challenge corruption while encouraging China’s harmony.

Creating America’s Future Economy

I will begin by saying what everybody would like to ignore or forget but which must nevertheless be stated, namely that our economic engine is absolutely broken. The discussion of how to help our economy is riddled with prescriptions for on undoing “mistakes,” freeing up capital for individual small businesses, bailing out troubled homeowners, and re-building infrastructure.

All that is piecemeal. It is wasteful and wrong. We cannot fix a broken economic engine by standing still, going backwards, or incrementalizing ourselves forward. The rest of the world is no longer there.

We need to move boldly to create the future. U.S. preeminence for at least half a century has rested on superior capabilities in computer science. Many of our most profound private sector innovations (such as microwave ovens, optical fiber, and video) were built off-of defense-related research and it is no coincidence that corporate innovators developed commercial applications.

When I spoke with Kimberly Clark’s head of R&D, he explained to me why they chose to move from Wisconsin to Seoul. “We are close to infotechnology, nanotechnology, and biomedical research.” He added, “We are close to Singapore, Hong Kong, and Tokyo. And access to those communities will drive our future.”

We need to put our energy into identifying the engines of economic growth where we can be global leaders—whether stem cells, nanotechnology, infology, or energy. The American future is not in automotive manufacturing. That is our past. We need to invest in building the capabilities, communities, and connectivity to become preeminent in key disciplines. And we need to do this together – right and left; private and public sector. Without collaboration, we will fail.

Success will happen like it happened in Silicon Valley when the public sector, the academic world, the private sector and the venture capitalist work together on creating a community of capabilities that draws in other capabilities and supports one another. It is more than being an incubator for start-ups — it is creating a community and spirit that work together and grow in capabilities with common underpinnings. The public sector needs to be the standard-bearer and economic encouragement that crosses company bound and academic bounds.

The key issue is not which economic faction gets the tax cuts. The political squabbling does nothing to advance the effort to find the platform from which we can be a leader in the global economy. That’s what keeps me up at night. We are asking the wrong questions. Our goal is not to recover but create–not to regain our past strength but to build the strengths we’ll need to create the future. Let us begin by defining those.

The BP Culture’s Role in the Gulf Oil Crisis

I’ve been watching BP carefully long before anyone heard of a “top kill” or “Lower Marine Riser Package Cap.”

I lived in Cleveland in 1979, when BP was acquiring Standard Oil of Ohio and worried for my friends who worked there. But I got reassurance at the time from Marvin Bower, a founder of McKinsey & Co. He told me BP wanted Standard Oil’s expertise in Alaska, along with their North American distribution system. Marvin emphasized that BP had a very human, non-hierarchical culture, respect for Standard Oil’s people and careful style of doing business. “The executives at British Petroleum,” he said, “are people of integrity.”

Now, 31 years later, in 2010, that culture seems to be lost. Culture is an organization’s operating system, the values that everyone lives by. The operating system helps humans communicate and make decisions. The operating system will not allow communication or decisions that could harm the values or purpose of an organization. It is like a translator.

In the case of BP, the culture didn’t work effectively and now its failure is on full display. It is possible that the error messages were so frequent that everybody chose to ignore them. A good culture would, by default, close all the possible doors to viruses or malware. A good culture or operating system is always going to respect priorities that keep the system working with integrity. Has the culture given way to a voracious need for corporate profits or is the problem simply arrogance? Did management become so cocky that they forgot that drilling in 5000 feet of water means pushing the edge of technology?

BP’s culture allowed extreme shortsightedness in pursuit of profit at the cost of safety or environmental stewardship. As the drill was planned, BP chose a cheaper casing seal, which reportedly contributed to the blow-up. Also, the company intentionally cut corners on procedural and safety. For example, last June, exceptions to BP safety standards were taken to senior executives who approved them. And according to a rig survivor interviewed on “60 Minutes,” BP ordered partners to cut corners because their absurdly ambitious drill schedule was off by several weeks. Hours before the explosion, multiple warnings arose; yet all were ignored. So much for the values of Standard Oil and BP. Incredibly, these penny-pinching moves were made as BP racked up record-breaking profits!

Even worse, the broken values appear to appear to go on, thanks to the company and the government. Consider BP’s attempt to disperse oil with Corexit, the dispersant already banned for 10 years in Europe. It’s highly toxic, but it does get the oil to sink below the surface, where it can’t be seen, thus decreasing the visual horrors as the goo comes ashore. It pushes the oil below the surface into the ocean column where it kills underwater sea life, and breaks it up into such tiny morsels that it can actually be absorbed into the skin of ocean and marsh-dwelling beings. BP snubbed the Environmental Protection Agency’s suggestion to stop using Correxit. In response, the EPA blandly called for a “study” of other dispersants.

This fiasco has become more about public relations than public’s right to know. Rather than releasing realistic figures of the volume of oil flowing into the environment, BP knowingly cited a very conservative estimate. They initially put up a video loop instead of live feed, until Rep. Ed Markey of Massachusetts forced a change. Their website excluded information about damages to fish and wildlife. Remember the Tylenol tampering scandal? James Burke and his team led a company culture that admitted the problem and set out to rectify it without pinching pennies. Along the way, they retained customers’ loyalty. And they did the right thing. That’s an example of a comapny culture leading the way forward and stands in stark contrast to what we see coming from BP today.

In the last couple of days, I called my old friends from Standard Oil of Ohio. One had retired, and lamented that the company’s values had disappeared in the wildcatter ’90s. The other just said, “It isn’t Standard Oil anymore.” How true.

Elizabeth Haas Edersheim founded NYCP, a management effectiveness firm, advises large and small businesses and not-for-profits and has written various management articles and books, including McKinsey’s Marvin Bower, and The Definitive Drucker.

2010 – The CORE Year: Change, Challenge, Opportunity, and Responsibility

As 2009 comes to an end, the sentiment that most immediately comes to mind is good riddance to what Time magazine dubbed the “decade from hell.”  Many Americans are suffering as a result of bad management, fraud and misguided policy – particularly in the financial sector.But let’s remember that even painful change is the precursor of opportunity.  Rather than wait for a new era, we must take an honest look and find ways to benefit from the incredible opportunities obscured amid the turmoil and wreckage.

Each of us has a rare chance to help define what will be; and the only constraint, beyond our financial situation, is our capacity to imagine. With this perspective, I share my optimism about the year and decade ahead while telling you about an unprecedented project that harnesses the expertise of people like you around the world.


Yes, the world has changed dramatically since 2000.  Consider the industries that are now in flux: energy, health care, transportation, technology, and education. Not-for-profits have been decimated, just when the need for social services and support are ramping up. Even individuals with good incomes are less able to give. Throughout all of this, heavily indebted governments are falling behind on critical needs that were already neglected.

Now consider the advantages to the individual.  We have unrivaled global access to information, combined with a transparency that never existed before. We have an ability to make intelligent choices as consumers, investors, entrepreneurs, and global citizens that our parents never even dreamed of.  Ready or not, we are all now self-managers who can be as entrepreneurial in our outlook as we choose.

Our world is connected in ways never before seen.  Even large companies need each other more than ever.  AT&T’s dependence on Apple’s iPhone overshadows its dependency on its own products. The old-line media companies rely on Google for ad revenue. With the technology for borderless commerce, small companies can connect with customers globally without the conventional intermediaries. Governments and regions are reliant on one another for economic stability. We’re seeing the positive and negative of the rise of Chimerica – a term coined by Niall Ferguson to denote the United States and China. America buys Chinese products; China lends us back the money.  That relationship makes a military war unlikely, but a trade war may have already begun.

Finally, the connections among individuals have changed dramatically as well.  As knowledge workers, we are more specialized and thus more reliant on the expertise of others outside our specialty, thus amplifying the need to be part of a whole that is greater than the sum of its parts.  At the same time, as information-empowered people and micro-businesses, we are less dependent on conventional “outside” experts and organizations.

The world today is so different from the one at the beginning of the 21st century that sometimes it is dizzying. And certainly we are prompted to re-visit our assumptions: §  Is Austria, a country I have always thought of as closed-minded, set to be more innovative than America?  They have free day-care for all two-career families.§ Is unemployment really up if I measure it using a global metric? Or should I think of the 16 to 24 year olds in Spain where unemployment for the group nears 43%?§  Will the next generation ever again have the opportunity to earn more than their parents?§ What is too big to fail today?   Might it be every SMALL business?

Here in America, I think we have a unique challenge relative to a number of other countries that are more accustomed to the dynamics of rapid change and lack a long history of global dominance.  Jim Collins tells the story of a Brazilian friend, who grew up with monthly inflation of 30%.  Some days it was cheaper to take a taxi than a bus because the bus fare was paid up front. What we construe as today’s disruptions and discontinuities, they view as relative stability and opportunity, not chaos.  My friends from China have experienced extreme, rapid change for the past 25 years and find relief when visiting what they view as a slow-moving, unchanging New York City.  Back at home, their GPS is unreliable because streetscapes are changing so quickly.

Not only are we uncomfortable with this ongoing economic roller coaster, we Americans are challenged by the very real threat to our long-standing position as the biggest, most dominant economy on the planet. Russia’s GDP is only 4% of ours, but economists are projecting that China’s will pass ours by 2027, and India’s will pass us by 2031. This new reality brings into question how we think about democracies.  Our democracy gives us freedom of expression and quality of life, but it also lets interest groups delay stem cell research and other innovations for years. Our two-party system has degenerated into partisan agendas that constantly delay vital innovations and entrepreneurial support.  Meanwhile, Korea, China, and India are eclipsing us in energy development, scientific research, and industrial policy.

Are we paranoid enough, visionary enough, and courageous enough to reinvent ourselves and our world?

Whether we are self-managing knowledge workers in a large institution, small business owners/entrepreneurs, or CEOs of our own careers, we all have greater freedom thanks to access to information and the reality of borderless commerce. We can do many things without third-parties, and often without leaving the house. This is both reassuring and daunting, liberating and imprisoning.  Collaboration is the linchpin of our interconnected Lego world. So, let’s stop being spectators to our future and instead create it.


From my long-time consulting and advisory work to management spanning many countries and the public and private sectors and my more recent work with Peter Drucker, I have become convinced that management effectiveness is the key to a proactive, smooth transition to a sustainable future.

To paraphrase one of my favorite Drucker quotes, our responsibility is to balance change and continuity.  If we have no change, we risk atrophying in our irrelevancy.  If we have too much change, we risk losing ourselves in chaos. The debacle of the last decade was not due to malice.  It was due to people enjoying their greater freedom while failing to step up to their responsibilities individually and collectively.

To meet our responsibilities head on, we need to be skilled at management effectiveness, not constrained by our tunnel-vision focus on ‘efficiency’, or quarterly profits. Management effectiveness means having the perspective and judgment to be more right than wrong, to leverage the power of people and their creativity throughout the repeating cycle of vision, execution, and outcome.Management effectiveness requires synthesizing information from all sources, challenging and enhancing conventional wisdom, learning from mistakes, and balancing multiple, often competing, objectives in a manner that enhances individuals and society.

To paraphrase Spiderman’s uncle Ben, with great freedom comes great responsibility.
I’m excited about a project that took up much of my time in 2009. It’s a pragmatic tool for helping promote management effectiveness — the Elemental Table of Management.   My team will continue to tap many of you for advice. When this project is fully operating, we hope to have positive impact on a hundred million managers in profit and service industries around the world. 
We are targeting to have a beta version up by the end of February, and a pilot running by the end of March.   We look forward to engaging with you in the testing, refinement, and launching of this effectiveness tool.

As Coleridge wrote, “Wisdom is common sense to an uncommon degree.”  Cheers to a wiser 2010 for all of us.

THE DRUCKER FORUM: Three Messages for Managers

8:51 AM Wednesday December 9, 2009
by Elizabeth Haas Edersheim
(Originally posted: HBR Blog)

I recently returned from the Peter Drucker Global Forum Vienna, Austria, an event held as part of the centennial celebration of Peter Drucker’s birth. Having studied and written about Drucker extensively, spent years infusing his thinking into my own management consulting work, and befriended him late in his life, I take three messages from the centennial celebrations.

1. Drucker’s work is widely accepted as foundational in creating a theory of management as the foundation of a functioning society, despite not being widely taught in business schools. Leading scholars consistently see him as a source of insight and inspiration, many of whom credit Peter Drucker not only as the creator of the discipline of management but as the basis for their own work. Stephen Covey, author of The 7 Habits of Highly Effective People, said, “I can find everything I’ve written in Peter’s work, 25 years before I thought of it.” Professor Hideyuki Inoue of Keio University said, “Everything we know about knowledge worker productivity is built on the foundation Peter Drucker wrote about 50 years ago.” Phillip Kotler, Distinguished Professor of International Marketing at the Kellogg School said, “If I am the father of marketing, Peter Drucker is the grandfather.” Jim Collins was so bold as to state, “Peter Drucker contributed more to the triumph of freedom and free society over totalitarianism, as anyone in the 20th century, including, perhaps, Winston Churchill.” Jim went on to explain that Drucker used his pen to, “rewire the brains of those who wield the swords.” In fact, Churchill insisted that all his officers carry Drucker’s book, The End of Economic Man, in their backpacks so they could remember why they were fighting the war.

2. Drucker created a new mindset in the practitioners who studied him, not only improving their skills but changing their lives. For example, Timotheus Sattelberger, currently a member of the board of Deutsche Telekom, found himself in a job where his values were at odds with the Chairman’s, and he was miserable. After reading Drucker, he went to his boss and said, “This clown is leaving to find another circus. He will not work in this one anymore.” Sattelberger continued, “It was the best move of my life. I assumed responsibility for my values.” Similarly, Cheol-hui Park, the CEO of Korean startup Park Electronics, talked about how Peter Drucker gave him the courage to move home and create jobs in an emerging company.

3. The third message is becoming more pressing every day: Because the new world is already here, the old world must vanish. Nearly every speaker at the centennial events around the world echoed that message. The old world was described as Cartesian, as a reduction of society to economics, as scattershot tools and frameworks that have dominated the past half-century. We are in a new world. Craig Wynett, Chief Innovation Officer at Procter and Gamble emphasized the power and importance of creativity in this world when he spoke in Vienna at the Centennial celebration. He said we talk about innovation, but creativity is that weird guy that we sometimes talk to in the gym. We need to challenge our assumptions about creativity and contributions, CK Prahalad emphasized a second change in this world issuing a call for “a new social compact of business.

Drucker advocated a social compact by focusing on being effective managers. “Management Effectiveness” means having the perspective and judgment to do the right things, about leveraging the power of people and their creativity in doing so throughout the repeating cycle of vision, execution, and outcome. Far from blind execution of orders, effectiveness requires synthesizing information and stepping up to challenge conventional wisdom. Effectiveness is the wholeness of the decisions – it’s synthesizing and balancing multiple, often competing, objectives in a manner that enhances individuals and society with no negative impact. Effectiveness also means the ability to make mistakes and learn from them.

That is our challenge as practitioners and as academics. It is a new world.

Elizabeth Haas Edersheim conducts case-study-based research on critical leadership issues — often in collaboration with corporations and speaks frequently at management events.


By Elizabeth Edersheim 
When the Leader to Leader Institute asked me to blog about my book, The Definitive Drucker, which was published three years ago, I thought, what would Peter Drucker have asked me about what I learned? I realized he’d have asked, what happened that was unexpected? And what did you learn?
The first unexpected result: The nature of the U.S. response to the book. I received numerous e-mails from readers in the United States, saying that the book changed their perspectives and practices. These came from doctors, lawyers, small-business owners, and executives with no business training, who happened to pick-up the book. The gratitude these letters expressed was overwhelming. One business owner wrote, “I run a wedding dress shop and never thought a management book could help me. I started reading it in a bookstore, and couldn’t put it down. Your book has changed how I make decisions and serve customers.” Many of the notes emphasized the universality of Peter Drucker, asserting that everyone can use his insights and thoughts.

The second unexpected result: I saw for myself that business frameworks, practices, and language are a great equalizer in a world divided into diverse religions, cultures, nations, political views, and peoples—and that Drucker’s thinking applies across the globe. The book has been translated into 32 languages and has taken me on an eye-opening global journey. I’ve visited seven countries in the last 12 months and corresponded with editors and readers in nine others. In Saudi Arabia, where women are forbidden to drive, a female business owner wrote to me with her thoughts on Drucker. In Japan, entrepreneurs are fascinated with Drucker, and a society has formed to study and promote his philosophies and practices. In China, one of the most respected CEOs, Zhang Ruimin, quotes Drucker religiously at Haier’s Saturday morning management meetings. The winners of Drucker innovation awards in Korea are global leaders and enduring benchmarks. What’s the strong attraction to Drucker in Vietnam, China, Korea, and Japan? Possibly the emphasis on people in Drucker’s philosophy, which mirrors the local cultures in some respects.

The third unexpected result is Drucker’s ability to stand the test of time. Though my book is admittedly only three years old, it draws on work, writing, and relationships from throughout Drucker’s career. Every company, Drucker complimented has done well. Every controversy and caveat Drucker raised has visibly elevated its ugly head. And the book’s observations about companies have held up despite the fundamental shifts we’ve seen in the past three years:

For example:

  • Medtronic continues to be innovative despite all the healthcare debates and their impact on private companies in that sector.
  • P&G is the success story of the decade, with Lafley named CEO of the year by Fortune, Forbes, Business Week, and Leader-to-Leader. Of course, P&G has faced day-to-day challenges in the current recession. For example, they had to decided to compete with private label products, introducing Tide Basic without bells and whistles. It is a dangerous strategy but one that might be the right response to the new realities. The recession changed the market, and management listened to their customers. They didn’t insist that every Tide customer needed to pay 30 percent more for Tide’s high-quality features.
  • JetBlue, which we highlighted as a star player, hit a bump in the road. Their performance fell off during winter storms. They had grown beyond their system’s capabilities. They stepped back and fixed the system, and are doing well again.
  • Peter Drucker had predicted that GE’s Finance group would get in trouble, and said they should sell NBC. He praised Immelt for jumping into green energy before anyone else.
  • The Myelin Repair Foundation is in the process of commercializing new drugs ahead of schedule and is moving ahead to address new challenges with new collaborations. It continues to be an amazing story.

Looking back and re-reading the book, there are many other companies built on Drucker that can be written about, such as Haier, Yuhan, Kimberly-Clark, Park Electronics, and FirstService.

Knowing Peter Drucker and writing about his ideas changed the way I listen and think. I’m hearing more and asking more, with a new appreciation for helping others think. I am very grateful for the time I have spent with Peter Drucker, his family, and his disciples. It was and continues to be a great opportunity.


by Elizabeth Haas Edersheim  September 2009

As the school year gets going and I have a chance to gather my thoughts from a trip to Asia, I wanted to share with you the incredible effort I saw in India around education reform focused on bringing post high-school graduates into the 21st century knowledge economy. It is quite a contrast to Bob Herbert’s comments on the status of the United States’ education reform, “In educating its citizens, we are now moving decidedly in the wrong direction”

Like the U.S., India faces a daunting education challenge—they need to make enormous improvements, immediately, in educating and training a very large and diverse population, with many of its people economically disadvantaged or living at a subsistence level. India has stepped up to the task, setting up a National Skill Council (NSC) to work with the Confederation of Indian Industry. They are rapidly innovating the entire concept of vocational and, in some sense management school, and revamping the country’s institutions, curriculum, and faculty.

India’s National Skill Council and the Confederation of Indian Industry believe that Polytechs—post-secondary vocational schools—are critical to the country’s future. By 2022, the government wants to train 500 million people to master a variety of skill—some entirely new—for the industries of tomorrow. Many of those people have only high school educations today.

They highlighted two primary challenges: (1) revamp a severely outdated curriculum and align it with the needs of industry, and (2) upgrade the faculty, ensuring that they have the knowledge to teach the skills of tomorrow and motivating them to continuously innovate.

Against these challenges, India is putting together two initiatives, both of them examples of the new Public-Private Partnerships.

Partnership 1 – The Indian government is moving the management of Polytechs to the private sector. Its rationale: industry knows exactly what they need, and knows how to manage a large institution. A radical change in governance is necessary to move forward.

The preliminary plan is that the private enterprise that takes charge of the contract will have no financial obligations but will need to make a number of commitments, including:

  • Involve senior management directly in the curriculum and teaching; every member of the senior team must commit 1-1/2 to 2 hours a month to lecture in the classroom
  • Modify curriculums to better support their own needs of tomorrow
  • Offer their own employees the opportunity to become students during 2% of their working hours every year
  • Create tighter links between faculty and industry – e.g., offer faculty training opportunities inside the company

This private sector engagement and commitment is expected to fundamentally shift the dynamics of Polytech education to the needs of tomorrow.

Partnership 2 –The government also announced a program for setting up new Polytechs—not in rural areas but in industrial centers. The government will provide land and set up residence halls so students can be brought to the industrial center from the countryside to go to school. Multiple companies located in the area will be engaged in the Polytech—setting the curriculum, training their current and future employees, and building state-of-the-art facilities.

Will these two initiatives meet all the educational needs of every citizen of India? Of course not.  But they are bold efforts that will carry substantial educational and economic benefit to many, with the further benefit of fueling India’s burgeoning knowledge industries and boosting its international competitiveness. And they are going forward NOW.

We can all take a lesson from India. Washington and our local districts recognize the challenge. But are we just doing more of the same and not stepping back and asking what we need to do for tomorrow? Finding the solutions will require creativity and involvement of more than government. Our challenge—to be focused on what 21st century students and their future employers really need, and more cognizant of every person’s need for lifelong learning.

©Elizabeth Edersheim



by Elizabeth Haas Edersheim July 31, 2009

Last week I had the opportunity to participate in the Student Leadership Summit, the inaugural event of the Frances Hesselbein Global Academy for Student Leadership and Civic Engagement, at the University of Pittsburgh.

The academy’s mission is to inspire, develop, and reward accomplished student leaders to meet the challenges of tomorrow. We spent four days engaged in intense learning, discussion, and fun with 44 leaders of tomorrow—4 of whom are my mentees. The summit began with “The Wizard of Oz of Leadership” and took these up-and-coming leaders through love, a lion, learning, innovation, tennis-racket propellers, inspiration, communication, respect, inclusion, a scarecrow, values, service, a courageous MIT engineer, passion, ethics, understanding cultures, a tin man, a gigantic light bulb, listening, the color line, confronting challenges, growing talent, creating opportunities, living, loving, and leading.[1] They came away understanding that—like the scarecrow, tin man, and cowardly lion—they already have the courage, heart, and mind to be leaders; they just need to see that it is all there inside them. The summit was fantastic.  I learned so much about the difference in perspective that young leaders bring to the table, and walked away with a new sense of hopefulness.  Some observations:

1.       The leaders of tomorrow emphasize collaboration in problem-solving, seeking ways to share what they have and meet the needs of the many rather than commanding scarce resources to benefit the few.  The members of the crucible generation, as Warren Bennis calls them, really do have a more collaborative and less competitive orientation then we ever did.  The differences came through every day as we watched them work.  The most telling moment was the Ugli Orange Exercise:  In essence, two competing pharmaceutical companies want the 4,000 Ugli Oranges right now.  One company needs them to fight a new and deadly prenatal disease, the other to resolve a deadly gas leak.  Participants are divided into teams of four, two representing each company. The speaker who presented this exercise has been using it for 20+ years.  For 20 minutes the two companies typically argue over whose needs are more important and arrive at no solution or action plan.  At the summit, all 11 teams rapidly discovered that one company needed the juice and the other the rind, and worked out a viable plan for moving forward.  Some went so far as to plant the seeds for the next year’s crop!  This has never happened before.  In 1994 no team found a solution.  At another group last year, out of 14 teams, 2 found solutions.  This year at the summit, every team tried to figure out how everyone could be satisfied rather than how to win a fight.  “What part of the orange do you need?” was the first question asked by one of my mentees.  The question belies a collaborative mindset that asks different questions and seeks fundamentally different types of answers.

2.       Despite perceived progress, the color line, with all its ramifications, is still an      active force limiting the participation and potential of millions in our society.  In another exercise, everyone in the room answered a survey featuring questions about isolation in everyday situations and scored their answers.  One of the questions was “Can I swear, or dress in secondhand clothes, or not answer letters without having people attribute those choices to the bad morals, the poverty, or the illiteracy of my race?”  At the end of the exercise, we lined up in order of our scores.  The predominance of black faces among those feeling most isolated was shocking.  It really brought home to me how far we still have to go toward achieving an inclusive society – even here, among the nation’s most engaged, highest-achieving students. The recent arrest of Henry Louis Gates, Jr., in Cambridge has once again brought this concern into the headlines. The presence of the Obamas in the White House – although inspiring and empowering for many – has not even begun to resolve the issue of how we diminish the defining quality of race in American society, how we bring people of color to the table as full participants.  One of the leaders of the future spoke about how many people asked her if they could touch or feel her hair.  There has been progress, but no magic; much more must be done.

3.       The power of a fresh, independent perspective cannot be underestimated.  On our third day, each group of four went to a not-for-profit organization in Pittsburgh to help address an issue facing the organization.  Their reports back to the group were astounding.  My group went to help the Ladies Hospital Aid Society (LHAS) think through how to revitalize their donor base.  My team’s first question about achieving that goal was, What is the constraint?  They felt that one significant constraint might be the name of the organization.  This created a lively discussion with the president and two board members.  Finally one board member said that when she has to tell people what LHAS stands for, she often bites her tongue.  It is not a name she is proud of, but she had assumed that, as the historical identity of the organization, the name could not be changed.  A young man on my team was quick to challenge this boundary condition, pointing out that the organization’s name had originally been the Hebrew Ladies Hospital Aid Society and could potentially be changed again.  I was reminded of why McKinsey hires very smart people with little or no business experience—because their lack of preconceptions enables them to push the envelope and cast a wider net in seeking solutions to problems.  My team discussed the need for diversity in the images of the organization and on its website, pushing LHAS to redefine its image to draw in more potential donors.  Now the board is engaged in reading the Harvard Business School case about the Girl Scouts.  The boldness the students showed in their recommendations was surprising, as was the rare opportunity for senior executives to listen to the leaders of tomorrow and discuss solutions with them.

4.       The older generation has a significant contribution to make—in mentoring.  Jim Collins, the dinner speaker on the final day of the summit, talked about how each of us needs a personal board of directors.  That is particularly true for the crucible generation, even though its members scored higher on every academic test than we did and have been developed and programmed to succeed throughout their young lives. They are emotionally young. They have grown up with more supervision than we had, and less freedom to experiment. They are operating in a very uncertain world, where the norm is relentless challenge and unclear expectations.  After working hard practicing and performing all their lives, these young people are now faced with the task of deciding how to change the world and making those sweeping changes happen.  They do need mentors and people to think with—people who believe in them.  When I came home, the first thing I did was call two young people I have worked with recently; I listened to their thoughts and encouraged their ambitions.  I hope to be in touch with each of my mentees for a long time to come.  Each of them is a fantastic person with a tremendous amount to teach me.  To quote Peter Drucker,  “Knowledge work requires continuous learning on the part of the knowledge worker, but equally continuous teaching on the part of the knowledge worker.”

5.       The leaders of tomorrow define success in terms of making a difference by serving others.  Our final exercise was for each leader of the future to define a mountain they want to move, the barriers to moving it, and a plan for how they will get started.  To a person, their goals are geared to making this a better world (rather than individual enrichment or achievement) and are all about service.  For example, Michael, a graduate student in pharmacy, wants everyone to have available comprehensive information about regulated and unregulated drugs and foods that impact their bodies.  He doesn’t want to be a pharmacist – he wants to help people improve their health.  Alyssa, an aspiring orthodontist, wants to serve children who might not otherwise be served and help them feel better about themselves.  Celeste, a student of Sport Science, wants to help other people accomplish things they never dreamed they could have.  Minh, an aspiring ophthalmologist, wants to break down walls and be available to patients where and how they need their doctors. Although it is possible that this youthful idealism will devolve into relentless self-interest, as happened with so many of the baby boomers, the strong emphasis on practical service to others makes me hopeful.

6.  Including and respecting young leaders is an essential step to helping them grow and develop. Including people in the group while acknowledging each one’s unique contributions and needs is an enormous part of leadership development—and that is the unique genius of Frances Hesselbein. Frances Hesselbein graciously introduces people to each other so they can make connections, broaden their view of the world, adjust their lens, and grow as leaders.  She introduced Tamara Woodbury—a colleague from the Girl Scouts of America whose interest in leadership and organization development was pushing her toward business school—to Peter Drucker, who insisted that business school would be a colossal waste of her time and offered her a different perspective on social enterprises.  As a result, Tamara came to change her focus and redirect her impact.  As Jim Collins says, “If you are a plant, Frances is the ultimate ultraviolet light—she helps each of us see things differently.  For me, the opportunity to talk with military leaders about leadership was a new and eye-opening experience. I learned about President Clinton’s courage in inviting and addressing contrary opinions, about the thinking behind his decision to send troops to  Bosnia when only 36 percent of Americans approved of it, because it was the morally right thing to do for millions of innocents.  And then when General Randy Fulhart offered to give me some feedback on my writing, a wide smile went across my face…that hasn’t left.

This summit adjusted all of our lenses.  Thank you, Frances.

As described by Charles J. O’Connor III, Retired Air Force Colonel, Senior Vice President, Fidelity Investments.

Elizabeth Haas Edersheim conducts case-study-based research on critical leadership issues — often in collaboration with corporations and speaks frequently at management events. 

©Elizabeth Edersheim



By Elizabeth Haas Edersheim
June 24, 2009


In 1964, Peter Drucker wrote,
“The first indicator of the need for major innovation is one with which economists have been familiar for well over a century: Declining productivity.”


We constantly assume that the private sector is the engine of innovation. But we need to rethink even that. Many of the requirements of innovation — the patience to wait for results, the willingness to take significant risks — are difficult for companies to meet. Companies systematically under-invest in R&D, especially for exploratory research and technology development. Start-ups systematically focus on very narrow segments.


2008 global productivity growth was the worst it has been for 20 years, and 2009 does not look much better. Despite large investments in innovation during the past decade, this effort has failed to deliver beyond a few high profile internet areas — Google, Facebook. This failure may be contributing to our economic difficulties.


Innovation, as defined by Drucker, is new wealth-producing capacity. With that definition, gene therapy, alternative energy, biotech, micromachines, etc., have not yet delivered.


It is an opportune time for public-private partnerships. They can make a difference in the speed and scale of innovation and the patience of startups.


The public sector — governments and not-for-profits — needs to help support long-term investment by large and small companies alike. Then it needs to accelerate adoption of innovations. When public-private partnerships are disciplined, they can create a new community of businesses and institutions, and foster many wealth-producing innovations.


For purposes of conversation, let’s focus on the most productive of government roles in fostering wealth-producing innovations via public-private partnerships.
Role 1: Assumption Busting. The first step in any meaningful innovation is to abandon assumptions. The government’s regulatory power enables it to radically alter conventionally held assumptions about the nature of competition in an industry.


Some cite government regulation as the most important factor in America’s success in information technology. The trustbusters made AT&T lease its lines to others and eventually broke up the giant. Later they forced IBM to separate its hardware and software businesses. In both industries, these actions challenged assumptions about the level of investment and integration required to compete. It also fostered innovation by replacing stodgy monoliths with smaller, specialized companies that joined forces with other, similar companies with complementary capabilities. The result — tremendous innovation and the emergence of new standards to support the collaborations.


Governments can also protect outdated assumptions, often with disastrous results. As Drucker said, the worst thing a government can do is hinder the movement of capital and people to new products, technological solutions, and modes of competition. A stark example of this is the U.S. government’s role in the terminal illness of the U.S. automobile industry with its support of mediocre mileage standards, work-arounds, and low gas prices.


Similarly, in Japan, the government’s failure to force new assumptions and passive acceptance of the status quo may have contributed to the country’s lost decade.


Role 2: Spotlighting An Opportunity. Governments can greatly increase the likelihood of an innovation’s success through strong public policy signals. And they can coax results with money. For example, NASA in the U.S. created decades of innovations, not only through funding but by sustained attention to the aerospace industry and its innovations.


China now is trying to shine a light on the electric car, as the Chinese market gears up. The Economist predicts that, in 40 years, China will have as many cars as the whole world does now. The government’s vision is for the Chinese auto market to bypass internal combustion engines for new buyers and go directly to the electric car as soon as possible.


China’s Ministry of Industry and Information Technology and the government of Wuhan are working with Nissan in Shanghai on a pilot electric-vehicle program.  Nissan is expected to provide free electric vehicles to Wuhan and to help develop a network of vehicle-charging stations. The ministry is also working on new facilities for their electric vehicles, joining forces with Beijing and BYD, the battery company that acquired a car company from the state. Beyond the auto companies, the ministry is working with a myriad other companies including grid intelligence companies, fueling, and network companies.


Role 3: Facilitating the Growth of Cutting-Edge Capabilities To Support InnovationsThis role focuses on underlying capabilities needed for innovation vs. directly on the innovation. As an example, let’s look at the state of Maine’s boat building industry.


In April 2007, a delegation of boat builders from Maine headed to Shanghai for the China International Boat Show, where they were treated by the national government as honored guests. Maine’s success in international boat building was made possible largely by public-sector efforts to build the state’s competency through a series of deliberate steps. It is an example of how government can fund collaborations across institutions to build competencies not achievable by any one company.


Maine’s boat building industry was flat from 1980 to 1994 with the closure of a local naval base and declining productivity threatening to kill it entirely. Recognizing that the future of the state’s boatbuilding industry rested on its ability to harness innovation capabilities in composites and nanotechnology to compete globally, several different types of institutions formed an alliance to create an advanced engineered-wood composite center — a university, workforce training centers, private companies, trade associations, economic development agencies, and investment organizations.


Government investments made participation in the center possible for many of these institutions — and paid for the trip to China. As a result of this coalition, Maine’s boatbuilding industry has more than doubled in the last 10 years and is at the cutting edge of innovation — taking a 400-year coastal heritage of skilled craftsmanship to a new level.
Role 4: Supporting Entrepreneurs And New Businesses To Build Innovation Communities. Government regulations, tax policy, and economic incentives are all tools that can be employed to help form innovation communities often dominated by the small businesses that create the most jobs and get the most patents per capita.


In my visit to Korea, a newspaper reported that young Koreans do not want to take the risks involved in starting businesses, or even work for small businesses. When I spoke with some entrepeneurs, they indicated that it was virtually impossible to hire talented people unless they were brought from the U.S.. People are afraid of small companies and are used to the security, as well as the health insurance and pension benefits, associated with the larger companies.


Government action can reverse such a trend, helping communities embrace start-ups with bankruptcy laws and small business loans, and creating community awards and recognition for businesses that contribute substantially to innovation communities.


The United States’ Small Business Administration (SBA) understands the importance of entrepreneurs and a continuing pipeline of new businesses. Its goals align with this critical need:


–         Continue to get loans out to small businesses
–         Revitalizing the agency itself, which was reduced and lost its focus over the last eight years
–         Making the SBA the strongest possible voice for small business in the U.S.


Certainly other public sector and non-profit entities can also play these four roles very successfully, with similar impact on the speed and scale of innovation. For example,The William J. Clinton Foundation supports a number of public-private partnerships. One worth following is the Clinton Climate Initiative, dedicated to environmental innovation. The Climate Initiative was launched in May 2006, when the former president’s advisor, Ira Magaziner, met with Ken Livingstone, then-mayor of London. Ken knew that the Clinton Foundation had joined forces with 60 different African countries to get a low-cost drug for HIV/AIDS brought to market, which none of them could have done independently. Ken suggested that the foundation undertake a similar project with large cities — which are huge contributors to greenhouse gas emissions — to advance some innovative-driven climate initiatives.


One such initiative is Clinton Climate Initiative’s C-40 project, which brings 40 cities together creating new economies-of-scale in demand for energy-efficient technologies — from the 367 million people that live in those cities — and linking demand with sources of supply. The C-40 project is a catalyst in accelerating market development for such innovations as clean-technology vehicles, energy-efficient lighting, chillers, solar control window films, and “cool” roofing that will help to lower the costs of building retrofits. These beneficial technologies all face a fundamental barrier to adoption: No customer is big enough to justify investing in cost-efficient scale production, and no company is ready to bet that future demand will approach that scale.


The Climate Initiative works with vendors to determine the volume necessary to fundamentally change their economics, using economic and life-cycle modeling to understand and think creatively about when and how a new technology can become attractive. The foundation then works with the C-40 cities and gains commitments to deliver that volume. They have broken through barriers that only a public-private partnership could. Hybrid buses, which first appeared in a few cities with big public subsidies, have been updated with newer technology and purchased for use in locations that manufacturers would not have approached for years. Already, many cities in India and Brazil are the world’s largest users of hybrid buses.


When I asked Magaziner to describe his biggest barrier, he responded that he is pushing everyone’s comfort zones. People can’t sit around waiting for the usual lag time from the usual circumstances – excessively long government time lines when it comes to ordering equipment from private suppliers, the hesitancy of entrepreneurs to push the envelope farther than they ever have, and so on. He’s right. Usual just doesn’t cut it under unusual situations like today’s productivity performance. Public-private partnerships can be significantly more agile than the usual contracts between state agencies and corporations. They are the right vehicle to speed the delivery and elevate the scale of innovations in the face of our critical needs.



Elizabeth Edersheim