CHAPTER  |  TWENTY-ONE

What Are You Going to Do About It?

Years ago, Peter Drucker was giving one of his all-day seminars. I think it was called “A Day with Drucker.” During the Q&A period, a clearly distressed individual launched into a long monologue about the challenges he faced in his company. These challenges appeared insurmountable. It was obvious that he expected Drucker to solve his problems, telling him what to do. At first, Peter listened politely. Finally, as the man went on and on, Drucker interrupted. “Okay,” said Peter, “so you are in trouble. What are you going to do about it?”

We Need to Take Responsibility

Early in what has been labeled the Great Recession, the CEOs of the three largest U.S. automobile companies flew to Washington, D.C., in their private jets to testify before Congress and ask for a multibillion-dollar bailout. Their argument was that these hard economic times weren't their fault, and unless Congress helped out, a lot of people would lose their jobs. They didn't ask what to do about it because they knew: “Give us money.”

The talk of a bailout for the automotive industry was already controversial. The day before, the Los Angeles Times reported that one senator said something like: “Look, I've heard from my constituents. They are very much against this. One works for a foreign automobile company which manufactures cars in the United States. He told me that he makes $40 an hour. He also informed me that the average worker salary at the ‘Big Three’ is almost twice that. He wanted to know why we should use his money so that some guy can make twice what he does for doing the same job. This worker is right. These people are in trouble due to the mismanagement of their companies. All companies are hurt when people aren't buying their products. These companies are in trouble too, and must take action to do whatever they need to get profitable given these economic conditions which we all face.”

The senator was correct in his assessment of the situation. How much people should be paid is really just a symptom of a greater problem. We cannot control nature, and we can't control most aspects of the business or economic environment. We can't control technological advances, and we can't control the changing beliefs or preferences of society. Regardless, as managers and leaders we are responsible for the welfare of our employees and the performance of our organizations, be they small units or giant companies.

I think Peter Drucker would have responded to the pleas of the automotive CEOs with this question: “What are you going to do about it?”

Example: Business as Usual

Someone pointed out that each of these CEOs, coming from the same city, had flown to Washington, D.C., in individual corporate jets that cost each company about $20,000. The CEOs didn't consider flying commercial, much less economy class. They didn't even consider flying together on a single airplane. Many companies have corporate jets. Normally they can save time and money by getting the executive where he needs to be quickly and efficiently, thereby helping him do a better job. But these CEOs were asking the government for a $56 billion bailout. As one congressman said, “Somebody said they're handing out free money in Washington, and these three came to get it.”

Their trip to Washington was a clear signal that these leaders envisioned only “business as usual.” As they saw it, the economic situation wasn't their fault, so somebody else should pick up the tab. They'd be perfectly happy to make some minor changes in the production of their vehicles, but they would press on doing everything just as always—at taxpayer expense, of course. And when that money ran out, they could return for more money from Uncle Sam.

No, Drucker would have told the three: “Okay, so you are in trouble. Sure it's the economy. You can't change that. But what are you going to do about it?”

My point is not whether the three executives should have been given the money, which they eventually received. The second time they came to Washington, they had the good sense to drive there, if only for appearance's sake. But many people wondered whether they had really learned their lesson. Today, the three companies are all profitable again, and I'm certain the executives are all smiles.

Example: Those That Were Too Big to Fail

It wasn't long before these automobile companies and other organizations, especially in the financial industry, which had been termed “too big to fail,” were profitable once again. Some were making more money than ever before. One financial institution that received government assistance turned right around and rewarded its senior executives large bonuses. But this is not a new story. Years earlier, Drucker had pointed out the unconscionable anomaly of executives’ huge compensation packages while they laid off thousands of employees. Talk about fiddling while Rome burns!

No wonder Drucker warned so emphatically that this meltdown would happen. He said that the gluttony of both outlandish executive salaries and the continually escalating demands of unions would eventually demand a terrible price.¹ Many in both camps were angry at him for saying this, but he was right.

Got Problems? What Are You Going to Do About It?

So here we are. Now what do we do? Drucker's main point is that we are ourselves responsible and cannot rely on someone else to give us the magic potion that will cause all the bad things to go away. However, there are general Drucker principles that can guide us in what we do. Here are a few:

• Take charge and decide what you are going to do next. Don't focus on what has happened or expect some miracle to put everything right. No matter how much you wish, you can't wish the problem away. So accept it and move on. This is true whether you are the CEO in charge, a manager who is trying to hold his or her unit together, or someone who has just been laid off.

A billionaire I know is a foreign national. While he was visiting in the United States some years ago, someone in his government launched an investigation of his operations, based on hearsay. It greatly limited his operations, he lost the first of hundreds of thousands of dollars, and his business empire came under government pressure and scrutiny. There was no warrant for his arrest, but he knew that if he returned home he might well be arrested and be able to accomplish very little.

So he put his company's day-to-day operations in the hands of a trusted subordinate and he worked through his lawyers to take many actions that were needed. He didn't waste time feeling sorry for himself or asking why this was happening to him. He stayed away while he made the decisions that kept his businesses in operation, working simultaneously to clear his name. It took months, but ultimately he was successful and things returned to normal. In fact, his businesses are fully recovered, bigger and more successful than ever. The lesson here is that when bad things happen, you don't sit around waiting for a miracle and feeling sorry for yourself.

• Use your resources and don't get discouraged. Even under the worst conditions, you have resources, advantages, and strengths that you may not have considered. Write these down. No matter who you are or what your situation, others have been there before and have overcome their problems. Do a little searching on the Internet and find out how they did it. Others have done “the impossible.” So can you.

It doesn't matter whether you are a Republican or Democrat, or whether you support President Obama and his policies or not. No one can deny what he accomplished in his campaign for election in 2008 and the huge challenges he had to overcome. Even within his own party, no one thought that he had a chance. Limited government experience—in fact, limited experience of any kind. He was best known for the highly acclaimed keynote speech he had written and delivered at the 2004 Democratic Convention in Boston. Do you remember Hillary Clinton's challenge to Obama four years later? “What is he going to do if he gets a crisis call in the middle of the night? Say that he has this great speech?” One well-known African-American politician told me: “Obama has a lot of ability and charisma. He'll be president one day, but not this year—this is Hillary's year.”

Obama's election proved that we all have personal resources to overcome a situation, even if the experts say we can't do it. If you or your company is in an impossible situation, what are your resources? I don't know. You are in trouble: What are you going to do about it?

• Develop a plan. Decide where you want to go and work out detailed short- and long-range plans to get there from where you are.

Tony Robbins was dead broke and living in an apartment that didn't even have a kitchen. It had a bathtub, though, and that's where Robbins washed his dishes. Robbins had no college degree, was barely out of his teens, and there was no one who could support him while he struggled to stay alive. Then he lost his job. He took charge and considered his resources. He decided what he was going to do, and he wrote down a plan for how he was going to get there. It didn't take long until he became both wealthy and famous as the preeminent motivational speaker in the world, consulted by kings and heads of state worldwide.

• Work your plan. Nothing happens until you take action, so do it! The ancient Chinese seer Lao-tzu said that a journey of a thousand miles begins with the first step. Take that first step.

As Mary Kay Ash did when her husband died suddenly two weeks prior to opening her cosmetics company, she got her saleswomen together, told them how they were going to implement her plan, and they went out and helped Mary Kay grow a billion-dollar company.

I'm told that more people became millionaires during the Great Depression than ever before. This is true, but it is misleading. Most people in this category became millionaires because of the demand for goods and services that came with the onset of World War II. However, offsetting those companies helped by the war, there still were many that not only survived but also prospered during the Great Depression. Smart companies like Procter & Gamble increased their advertising and took advantage of a new medium—radio—much as Barack Obama took advantage of the Internet, cell phones, and YouTube during the 2008 presidential election.

However bad any situation looks, Drucker advised, extraordinary leaders are successful because they do things that ordinary leaders just won't do. Are you and your company in trouble? What are you going to do about it?