On March 30, the Corporate Learning Network held its long awaited Drucker Master Class Day – led by celebrated Drucker management guru, Dr. Bernard Jaworski, Professor at the Peter F. Drucker and professor at the Peter F. Drucker and Masatoshi Ito Graduate School of management.

1. A. Morrison
Breakout Exercises – Master Classes
Bernie Jaworski and Bruce Rosenstein
March 30, 2021

2. Breakout Exercise:
Five Drucker Principles for Leading Change
Directions:
Take a few minutes to score your firm in each principle
Then discuss each principle with your breakout team.
Reflect on:
1. Why is your firm scoring low (high)?
2. For those scoring high, what advice can you provide other breakout team
participants?
3. If everyone scored low, brainstorm what can be done to improve

3. Regularly abandon things--products, policies, practices--that are no
longer effective or are consuming an inordinate amount of
resources when weighed against tomorrow’s opportunities.
1 2 3 4 5 6 7 8 9 10
Is comfortable doing business
the “same way” over decades.
Never runs true “experiments” to
test when the core business
model must change. “Hopes”
business context and macro-
environment stays the same.
It does innovate – it only “adds
on” to core products and
services – it does not abandon
things.
Firm innovates and abandons
products and services.
However, it is largely regarded
as a follower. Waits for others
to abandon products,
services, or markets – and
then tries to adapt to the
changes.
Firm has “reinvented” itself
several times. Recognizes
that all process, systems,
products become dated.
Actively engages in
construction of “next”
business model of the
future – with aim of leaving
competition behind.
Regular Abandonment is Practiced

4. Keep an eye on the long term--and not just the short term--while
being mindful that, while “securities analysts believe that
companies make money, companies make shoes”
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Firm is largely focused on meeting
quarterly financial targets. Does not
invest in understanding key forces
of change. Regularly cuts R&D
spending when financial results are
not satisfying management
expectations. Has no clear point of
view or plan to get to the future
While firm is focused on
meeting short-term targets, it
also allocates time and
attention to the future.
However, most in the firm
would agree that too little effort
is spent – time, money, and
attention – on how the firm will
need to change to compete in
the future
Firm allocates 15-20% of its
attention on the future. Often
separate budgets and units are
established to help get to the
future. At the same time, the
firm is able to consistently
perform year over year.
Balances Short-Term and Long-Term Results

5. If we were to go into this now, knowing what we now know, would
we go into it the way we are doing it now?
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Yes, our overall
business model works
exceptionally well.
Very little change is
needed. We simply
need to continue to
optimize our current
approach.
Our business model
generally works – but we
certainly need to get rid
of some existing assets,
resources, and
capabilities. The market
is changing and we are
not changing fast enough
No, our business needs a radical
overall. New players have either
entered our market with a much
better business model – or the
threat of this is significant. If we do
not modify our model – by
abandonment and innovation – we
will hit a brick wall within three
years.
Business Model – Is it Outdated?

6. We do a great job of “testing” the future through the careful
design, construction, launching, and evaluating pilots.
1 2 3 4 5 6 7 8 9 10
We rarely – if ever –
run pilots
We do run pilots – but
we could significantly
improve our approach.
The pilots are not large
enough – nor resourced
correctly – to get an
accurate read on
whether they worked or
failed
This is one of our core strengths.
We know how to run pilots- they
are fielded by the right teams,
resourced correctly and have the
right level of after action review.
Designing Pilots

7. Nothing could be sillier than the oft-repeated assertion that management only adapts
the business to the forces of the market. Management not only finds these forces;
management creates them by its own actions. The more management creates economic
conditions or changes them rather than passively adapts to them, the more it manages
the business
1 2 3 4 5 6 7 8 9 10
We are largely reactive
to macro-
environmental and
industry changes.
We have done some
activities that have
shaped the future of our
industry – but we are not
widely viewed as an
industry leader. At best,
we are viewed as a fast
follower.
We actively “lead and shape” our
industry structure. That is, we are
well known for shaping the
evolution of our industry – and the
evolving preferences of our
customers. We are seen as “driving”
the industry – and our organization
– into the future.
Shaping the Future

8. Breakout Exercise:
Five Drucker Principles for Innovation
Directions:
Take a few minutes to score your firm in each principle
Then discuss each principle with your breakout team.
Reflect on:
1. Why is your firm scoring low (high)?
2. For those scoring high, what advice can you provide other breakout team
participants?
3. If everyone scored low, brainstorm what can be done to improve

9. See innovation--that is, “change that creates a new dimension of
performance”--as the responsibility of everyone in the enterprise,
not just the R&D staff
1 2 3 4 5 6 7 8 9 10
Innovation is a low
priority in the operations
of the firm and
responsibilities of its
employees. Firm is largely
focused on maximizing
present offerings
Has a dedicated R&D department
to take care of innovation in its
field. Innovation largely defined
as “product” orientation. Large
percentage of employees do not
engage in innovative behavior.
They do not see it as their
responsibility
All employees are entrusted with
the responsibility of innovating in
their area of operation and recent
examples of these types of
innovation exist. Innovation is
broadly defined – product,
process, business model, alliances
and so on
Everyone Innovates

10. Always remember that “there is only one valid definition of
business purpose: to create a customer” while accepting that
“quality in a product or service is not what the supplier puts in. It is
what the customer gets out and is willing to pay for.”
Focus on Understanding Customer Needs
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Company relies heavily on its sales
people to use a variety of selling
techniques for getting customers to
say “yes.” The primary emphasis in
the company is on selling. Customer
satisfaction is considered important
but the emphasis is on going out and
pushing the company’s products and
or services
Company does basic
market research –
but typically scores
“average” on
customer satisfaction
scores within its
industry
Company does a lot of research to learn the
concerns of its customers, and
responds by developing new products and
marketing programs. The emphasis is
on understanding why customers act and feel
the way they do, and responding with products
that meet these needs… Selling is considered
important, but the emphasis is on making
products (or services)
that will almost “sell themselves”

11. The unexpected is often the best source of innovation. Focus on
opportunities. Starve problems and feed opportunities.
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We have no processes to
systematically review
unexpected surprise and
failure. Overall, we tend to
focus a good deal of
organizational resources
and attentions on problems
rather than opportunities
We would score in the
mid-range on this
principle. We can point
to cases where we have
taken the right course of
action on expected
surprise and failure – but
it is not a core
competence.
We carefully review unexpected
surprises and failures. For
unexpected product failures – we
tend to recognize them early and
shut down investment. If
unexpected product successes, we
quickly reallocate funds to take
advantage of marketplace
dynamics.
Mining – Surprise and Failure

12. Whatever an enterprise does internally and externally needs to
improved systematically and continuously. Continuous
improvements in any area eventually transform the operation.
1 2 3 4 5 6 7 8 9 10
Our continuous improvement of
our overall business approach
(target customers, products,
services, processes, workflow) is
limited at best. We have largely
had the small business model in
place for years.
We are in the middle of the pack
in our industry on continuous
improvement. We do practice
improvement – but I would not
rate it as a core strength.
We practice continuous
improvement through a rigorous
process such as six-sigma, Kaizen,
and/or other methods. We are
constantly and incessantly focused
on incremental improvements to all
aspects of our business.
Continuous Improvement - Kaizen

13. Push responsibility and accountability as far down into the
organization as possible and follow this basic communications
strategy: Listen down, talk up.
1 2 3 4 5 6 7 8 9 10
Only top executives take
responsibility. All others in
execution mode. Strong
command and control culture.
Employees do what they are
told.
Adheres to a strong hierarchical
structure with senior managers being
held responsible and accountable.
Employees largely follow direction and
have little discretionary responsibility.
All the employees feel
responsible and accountable
for the success of the firm.
Heavy responsibility of front-
line employees to shape their
job requirements. All
employees held accountable.
Responsibility and Accountability at All Levels