Blockchain For Managers

No matter one’s professional background, these days it is almost impossible to escape at least a very basic introduction to “blockchain.”

At its core, blockchain has the potential to give every individual access to data, processes, and the ability to transact with others on a scale that was never before possible. From a strictly mid-20th century point of view, the introduction of blockchain is the next step in a future foreseen by Peter Drucker. Many individuals will be self-employed, and the value creation process will be overseen and managed in a way that no longer requires multiple layers of other human beings to be part of the process. It is likely to be implemented by HR departments for employee record and compensation management, and will almost certainly be the final nail in the coffin of mandatory centrally located physical workplaces. It could also be used for proof of work, and as a means of payment using virtual currency such as Bitcoin.

For professional managers, a discussion about blockchain opens up several landmines, none of which are easily dealt with. The reason? The technology will wreak havoc on the managerial class. Many things managers do – and in many industries – are about to be automated out of existence.

Blockchain will create the same kind of career obsolescence for managers in many industries as the self-driving car, automated manufacturing, and automated supply chains will produce for “blue-collar” workers.

Unlike the less educated, lower skilled part of the workforce, however, managers will be tasked with planning their own extinction.

How to embrace that future?

Firstly, as a manager, you need to become an expert on how blockchain can be implemented in your industry. And secondly, you need to step up to the plate, and lead the change in whatever area it is that you work.

For anyone who comes from a non IT background, this might sound like a daunting proposition. However, for the current batch of MBA graduates, usually somewhere between their late twenties and early fifties, this is the task currently at hand. It will be impossible for this group to escape further formal education or work experience that requires them to understand, deal with, or implement blockchain in some form or fashion.

While a good technical background will of course be helpful, understanding how blockchain will impact your industry is much more about understanding your industry, the needs of your customers, and how this new technology might be able to solve problems in new and more efficient ways.

One of the most important things to remember about blockchain is that it is uniquely suited to tracking, monitoring and creating data in process-heavy parts of an industry. As a result, blockchain will initially be useful in banking and financial services, but will also quickly take hold in supply chain management.

Digital natives and those who have adopted this new technology because of the demands of working life (Gen X in particular), will have little trouble understanding how blockchain can be applied to these kinds of use cases.

What Are Concrete Steps I Can Take Now?

Human work and organization is in the early stages of being redesigned in a way that will be every bit as transformative as the industrial revolution was in the 19th century.

Revolutions, by definition, cannot be managed. Change, however, certainly can be.

One of the first steps to riding the wave of change is to accept that the world is rapidly transforming and that blockchain is one of the key drivers.

To that end, there are a few things you can do to prepare yourself.

  1. Take a course on blockchain. Consider a specialized course offering for managers in a banking or finance center where you will have access to the best teachers and thought leaders in this space including but not limited to IT experts (which often include lawyers, academics, regulatory agencies, and people in leading industries) where this is hitting first.
  2. Look on Meetup for groups interested in tech. This is a good way to meet other professionals who have a common interest.
  3. Think about vital processes in your industry and how blockchain might be used to improve them.
  4. Design a flow chart with one process you believe can be improved by a blockchain application.

Embracing blockchain will help you to understand the technology and identify ways that you can manage change within your industry, and be a positive driving force for innovation.

Marguerite Arnold is the founder of MedPayRx, a blockchain healthcare startup in Frankfurt. She is also an author, journalist and has just obtained her EMBA from the Frankfurt School of Finance and Management.

Image: Pexels

Corporate Career or Entrepreneurial Path?

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This is a guest post from Marguerite Arnold.

I am a bit of a late bloomer in some ways – certainly academically. At the age of 48, I decided, after a life spent in business of all kinds, to go back to school, obtain my EMBA, and focus on an entrepreneurial career.

It’s not really that delaying my master’s was a choice. When I was younger, I couldn’t get a school loan. I had no cosignors. And the jobs I got never paid enough to get the loan either.

But here I am.

If I were to compare myself to any generation right now, it would not be my own but to the generation of young people currently leaving university for the first time. I have no home loan and, despite a good stint on Wall Street earning a six figure salary, all of my net worth was wiped out in the “Great Recession” along with anything like steady employment.

As a person of a certain age, not to mention a foreigner in a country where I still struggle with the native language, I have embraced the digital “gig economy” – I had to. That said, I have always been exposed to it. My parents were self-employed. My uncle was Peter Drucker – a man who wrote about corporate management – yes – but who also foresaw the situation we face now. Going to business school these days, more than ever, is about learning to manage the dichotomy between the way things were and the way things are changing.

Don’t kid yourself. The entrepreneur’s path takes a lot of practice and perseverance. It is never easy. But thinking out of the box right now is the only sure path to longer term survival. The attraction of a steady full-time job, certainly in the U.S. and the U.K., is the comfort provided by getting a pay check each week, or at the end of the month. The concept of job security though has gone out the window. The concept of a “corporate manager” is also changing fast.

As business school students contemplate the future, one thing is very clear. The old ways of doing things, along with old business paradigms, are shifting faster than the textbooks can adapt. Faster, in fact, than society can. That is always the way it has been, but this time, the shift is more profound. Companies cannot survive without acting like lean and agile start-ups, and figuring out a way to make that happen is a core priority for managers.

In some ways, deciding whether to pursue a corporate track job or jump into a start up is not a choice – just a delayed reality. Newly minted business graduates, in particular, could do far worse than reset their expectations and set their vision on leading an entrepreneurial life, right from the start.

Marguerite Arnold is an entrepreneur, author and third semester EMBA candidate at the Frankfurt School of Finance and Management.

(Image Source: Copypress)

The Lessons I Learned From Peter Drucker

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This is a guest post from Marguerite Arnold.

It is not like I knew Peter well – as a real live person. In fact, I only met him once – in Claremont – as a very old man. That said, I always found it rather funny and more than touching that for a man who helped chart the academic progression of American management studies, he never lost a heavy German/Austrian accent. “Zis ist Peter Drucker” – the message he recorded on his home answering machine – was a cause of much delight at one point in my life, particularly because my father spoke with an upper class English accent, and my aunt with a highly Californianized German one.

Peter was the husband of my father’s eldest sister, Doris. My father was not a fan. Apparently in my family’s frantic transition from central Europe via England and then to the U.S. during the 1930’s, the relationship between the two men became fraught with tension and personal squabbles whose original genesis was odd, to say the least. The cause of a decades long civil war apparently started over Peter’s heavy handed English language instruction to my father (then in British boarding school while Peter was a business journalist in the UK). It continued over the course of a lifetime, fuel added to the fire by envy, competition and academic success. My father thought it was fundamentally “unfair” that the End of Economic Man was published to take advantage of the announcement of the Stalin-Hitler Pact. While Peter taught at NYU, my father was at the New School. Peter followed an entrepreneurial academic path. My father a journalistic and creative one. My father also had a fundamental disgust that Drucker covered up the fact that he was Jewish. In fact, he frequently referred to my uncle as “that ugly man” and (more than once) as an “unapologetic fascist.”

Perhaps because of that, I read all of Drucker’s major works as an act of rebellion by the time I entered college (in the mid 80’s). And at that point Drucker was already being redefined, as well as slightly shelved, by the newer generation of management consultants who took his place. I also experienced his work about the “third way” by being exposed to it directly in managing a non-profit as one of my first jobs out of school. Even at the time, I thought it represented a way to redefine his voice in a way that I believe will continue to be redefined in the century “after Drucker”. He was shifting from writing about focussing on management for the manufacture of profit to management to profit society. At that point in his life he also began to believe that his work was being misinterpreted. By the turn of the century, this was much more evident, at least in private. According to my aunt, who accepted the Medal of Freedom on his behalf (because at that point he was too sick to travel), Drucker was also unbelievably embarrassed that “management by objective” had been used to justify the Iraq War.

Interpreting Drucker’s intended meaning has been, as a result, a journey that I have undertaken as part of understanding my family and myself as much as it is about management.

My perspective on Drucker started with my curiosity about why he felt that nepotism was a fundamental evil. As a child I often thought this was because of the ancient family feud between my father and my uncle.

But as an adult, my understanding became more nuanced.

Drucker was, at least in my mind, a business anthropologist. He sought to understand and explain company culture in a way that is akin to an expat trying to understand the culture of a new country. He was no less hurt than most European Jews were about being betrayed by their home countries on the basis of an intangible idea (religion). His writing about nepotism, for example, was I believe a fundamental criticism of the German “Mittelstand” and how easily companies designed for one purpose (efficient production and profit) can be perverted by politics, as happened in Europe with the rise of Hitler. Later Drucker writing on the importance of managers getting out of the way and letting employees do the work they were there to do, as well as his early interest in an IT enabled and remote working environment, was also heavily influenced by the background of a man who relied on his entrepreneurial skills and distrust of office politics to survive in a world hostile to immigrants.

By the time Drucker shifted in focus at the end of his career, he had clearly also become concerned with the way that American corporate life was rapidly undermining the stability of American society achieved after WWII. “The third way”, and his argument for the professionalization of non-profit work, was in some ways a bit of an apology for Drucker’s early celebration of corporate culture in the U.S. His writing on executive pay, for example, was clearly a reaction to the beginnings of private sector greed that has become a major political topic of our new century.

Ultimately, Drucker was a man who sought to make sense of a world caught between politics, society and culture operating within the framework of something else – the corporate structure. While the specific issues that our society is called upon to face are of course different at the beginning of this new century, I also feel that the things he wrote about have never been more pertinent and relevant.

Marguerite Arnold is an entrepreneur, author and third semester EMBA candidate at the Frankfurt School of Finance and Management.

(Image Source: Benandju)

Set SMART Goals

Whether your goals are personal or professional, setting SMART goals is the first step to actually achieving them

Set SMART Goals

“A goal properly set is halfway reached.”
~ Zig Ziglar

1. Background

ALTHOUGH its origins are unclear, SMART goal setting appears to have been first used by Peter Drucker in his 1954 book “The Practice of Management”.

2. Relevance

Where ever you are right now, you most likely have bright dreams for the future. You may want to publish a book, get your dream job in consulting, boost company profits by 50%, or take a much deserved luxury holiday to the Maldives. The future is a bright beacon of hope where your imagination is the limit and anything is possible; but how do you get there?

3. Importance

The only way to make your dreams for the future become a reality is to set clear goals and to achieve them: each day, each month and each year. Whether your goals are personal or professional, setting SMART goals is the first step to actually achieving them.

4. SMART Goals

Your goals should be SMART:

Specific
Measureable
Achievable
Relevant, and
Time-Bound.

4.1 Specific

Your goal should be specific. Goals must be clearly defined and describe what will happen in as much detail as possible. Clearly defined goals are helpful because they allow you to focus on taking action rather than trying to define and understand the goal. For example, a goal to “increase company profits” could be replaced by a more specific goal to “increase profits in each division of the company by at least 5% with 12 months.” Vague goals are no good because it is not be possible to measure progress or to know whether the goal has been achieved.

If your goal is specific, you should be able to answer the following questions:

  • What is the goal? Write the goal down so that you have a record and use action words like “build, organise, complete, create, coordinate, make, develop, plan”. What actions will need to be taken to achieve the goal?
  • Who is involved? Who is responsible for each action that will need to be taken? It may help to write in the active voice, for example “John will organise the web-design…” and not “the web-design will be organised…”
  • Where will this all happen?
  • When will the goal be achieved?
  • How high are you aiming? Be specific. For example, are you aiming for 7% profit growth, or is 4% okay?

4.2 Measurable

Your goal should be measurable so that you can track your progress, hold people accountable for their performance, and so that you know when the goal has been achieved. Make sure that you have established criteria for measuring progress toward the goal. Measuring your progress is important because it will help you stay motivated and on track. If you are behind schedule this would be good to know because it gives you the opportunity to re-double your efforts and make up for lost time.

To determine if your goal is measurable, ask questions such as:

  • How much?
  • How many?
  • How will we know when the goal has been achieved?

4.3 Achievable

Your goal should be achievable with the resources available. Your resources include assets such as cash, real property, equipment, intellectual property, the skills of the people involved, and the time available. If your goal is not achievable with the resources available then you will need to create a sub-goal “get more resources!” and achieve that sub-goal before returning to the primary goal.

Your goal can be ambitious but should also be realistic. If you set the goal too high or too low then the goal will not be meaningful and people will lose motivation.
To determine whether the goal is achievable, ask questions such as:

  • Can we get it done in the proposed timeframe?
  • Do we understand our limitations and constraints?
  • Can we do this with the resources available?
  • Has anyone else done this successfully?
  • Is this possible?

4.4 Relevant

Your goal should be relevant in the sense that it should be consistent with your core values and broader mission. Achieving your goal should move you forwards, not bump you sideways or push you backwards. If your goal is relevant and you are willing to make it a priority then this will help you take ownership of the goal and increase your chances of success.

To determine whether the goal is relevant, ask questions such as:

  • Why is the goal important?
  • Have we achieved similar goals in the past?
  • If the goal is achieved, how will we benefit?
  • Is this a priority?

4.5 Time-Bound

You should set a date by which the goal will be achieved. Setting an end point for the goal will allow you to determine whether you are making good progress. In order to meet a fixed deadline you will need to focus your efforts and work efficiently, there is no time to waste. Go. Hurry.

To determine whether the goal is time-bound, ask questions such as:

  • When will the goal be achieved?
  • Is there a deadline?

[For more information on consulting concepts and frameworks, please download “The Little Blue Consulting Handbook“.]

What is the purpose of a business?

MAINSTREAM economics would have you believe that the purpose of business is to maximise profits.

If a business loses money it will soon go bust, this much is clear. Profit is necessary for any ongoing business operation, however the fact that a business makes a profit does not explain the purpose or raison d’être of the business. The Dalai Lama put it this way:

To state that the role of business is to make a profit makes as much sense as to say that the role of a person is to eat or to breathe. If a company loses money it dies, as does a person without food, but that does not mean that the purpose of life is eating.

Peter Drucker, father of the modern management profession, believed that:

Profitability is not the purpose of, but the limiting factor on, business enterprise. Profit is not the explanation, cause or rationale of business decisions, but a test of their validity.

Profitability allows a business to sustain itself, but it would be dangerous to make profit the most important objective of a business. A corporate culture that values profit above all else may lead to law breaking, excessive risk taking, unnecessary suffering for employees, or damage to society and the environment.

Instead of focusing on profit, a business should aim to satisfy customers while acting responsibly. By satisfying customers the business can occupy itself in a meaningful way. And by acting responsibly, the business can prosper without harming others. If the business can also make a profit then its activity will be self-sustaining.