What Kind of Crisis Leader are You?

Karen Linkletter Ph.D.

PUBLISHED:

September 24, 2022


Thirteen years ago in September, I was diagnosed with breast cancer. It was a complete shock, as I had no family history of it and was, I thought, perfectly healthy. I was told I would probably not need chemo after my surgery, which took place one month later. After the oncologist obtained more information from the tumor samples, it turned out the cancer was much more aggressive than he originally believed. Chemo was next up. The journey to remission was one such surprise after another; every time I thought we were out of the woods a new complication arose. My strategy for coping was to imagine myself every morning donning a pair of boxing gloves and duking it out with whatever villain cancer threw my way.

Since the COVID-19 pandemic, there are countless articles on crisis leadership. Studies point to the importance of resilience in individuals and organizations, the role of communication and information, empathy or compassion as a component – the body of work in this area is enormous. We will likely be thinking and learning about crisis leadership for quite a while in the wake of this once-in-a-generation event. 

I got thinking about this topic of crisis management not because of the pandemic, but because of the realization that there are many different kinds of crises, and also many different possible ways to respond (more than one of which can be effective). The passing of Queen Elizabeth also made me think about the phrase “stiff upper lip,” the stoicism and determination in the face of adversity often attributed to the British. I suppose my psychological boxing match with cancer reflects a similar kind of response; I can also see why such a response seems aloof, callous, and heartless to some. 


What is your personal style of response to a crisis? What is your most natural inclination? Does it transfer from your individual personal life to your style of leadership with others? Is it helpful to have a range of ways to respond to crisis, particularly in the face of different kinds of crises? 

 

Peter Drucker called leadership a “foul-weather job”: 


The most important task of an organization’s leader is to anticipate crisis. Perhaps not to avert it, but to anticipate it. To wait until the crisis hits is already abdication. One has to make the organization capable of anticipating the storm, weathering it, and in fact, being ahead of it. That is called innovation, constant renewal. You cannot prevent a major catastrophe, but you can build an organization that is battle-ready, that has high morale and also has been through a crisis, knows how to behave, trusts itself, and where people trust one another. In military training, the first rule is to instill soldiers with trust in their officers, because without trust they won’t fight” (Drucker, 1990, p. 9). 

 

Drucker uses battle imagery to describe crisis leadership. How do you get people in your organization to be “battle ready”? Make sure that the organization is ahead of the curve to the best of its ability (isn’t blindsided, if possible). The timing and nature of the COVID-19 pandemic could not have been foreseen; however, SARS, MERS, and other virus outbreaks taught us (to some degree) that public health events were possible. But perhaps the most important message Drucker conveys is the importance of trust; people must not only trust leadership, but must also trust one another (and, I would add, themselves). Even in the face of limited information and rapidly changing data and events, a battle-ready organization is willing to fight together because there is trust at all levels. They trust leadership’s integrity, honesty, and capability. They trust each other’s ability, dedication, and perseverance. And, importantly, they trust in their own individual capabilities to execute the work that needs to be done and to be willing to take risks. In other words, we all put on the gloves because we know we did our training and are able to perform to the best of our ability – even in the face of a relatively unknown opponent. 


This sort of military language related to crisis management and leadership can lead to somewhat gendered views of effective reactions to crises. The phrase “Keep calm and carry on” was originally used on a poster to motivate the British at the beginning of the Second World War, but it became associated with Queen Elizabeth as the reigning monarch and symbol of British resiliency. Angela Merkel’s leadership of Germany during the pandemic was widely praised for her clear communication of information and her cautious, unemotional, and analytic tone; one scholarly work notes that Merkel refrained from using war metaphors in her framing of the pandemic. During and after the 2016 presidential campaign, media coverage dissected Hillary Clinton’s lack of emotion or warmth, or any expression of feeling. This focus on women’s emotionality – or lack thereof – may result in the “stiff upper lip” style of crisis management that may appear cold. 


A similar sentiment to this gendered, military style view of crisis management was attributed to President John F. Kennedy’s father, Joseph Kennedy. “When the going gets tough, the tough get going” was a Kennedy family saying used to rally the team in the face of adversity. “Toughness” can be viewed in a number of ways, from physical strength and endurance to emotional resilience. In cultures with a strong Protestant history (Germany, the United States, Great Britain), this association between hard work and morality, virtue, and success is deeply ingrained. Sociologist Max Weber famously wrote on the role of the Protestant work ethic and its impact on the drive for capitalism and economic success. The willingness to subordinate immediate gratification for future rewards in large part fuels “toughness,” particularly in the face of adversity. 


But different kinds of crises warrant different kinds of responses, particularly when they involve leading people.  We have so much new research to digest. The importance of resilience is clear in most research on crisis management. How to implement that in organizations is a challenge, given that some people are more resilient than others. Research in the area of public health is showing us how this might work in organizations, not just during a pandemic. How can we, for example, actually use periods of disruption to encourage new relationships and provide a period of adjustment to extreme change? This would involve breathing room. If the building is on fire, we can’t do this. But if we are trying to grapple with big uncertainty, this might be a wonderful insight.  We are also learning that, while vision is important, the harder, in-the-trenches work of making sense of what is happening in the moment is equally important (“holding” in psychological terms). This does not involve “toughness” or “a stiff upper lip.” It involves explaining and making sense in a way that taps into emotion and uncertainty. Angela Merkel embodied this during the pandemic. 

Psychologist Angela Duckworth’s 2013 book, Grit: The Power of Passion and Perseverance, sparked a discussion about the qualities that lead to success. Her experience as a management consultant, educator, and psychology researcher resulted in her conclusion that persistence in the face of adversity, fueled by passion and clear, high-level goals, are the drivers of success. Her primary point is that talent alone does not dictate achievement. The concept of “grit” has taken on social meaning, particularly in America, where the story of achievement through “hard work” and “pulling oneself up by one’s bootstraps” has deep roots. This keys into the cultural ground of “toughness.” Those who have trouble adapting to change, particularly during the pandemic, are sometimes accused of lacking “grit.” 


Finally, there is the literature on empathetic vs. compassionate leadership. In a crisis, it may be a mistake to be empathetic; there is no time to truly feel everyone’s situation and connect. But one can be compassionate. Compassion moves empathy (feeling) to a position of action (helping). 

Each crisis demands an assessment of the leadership style needed. My cancer battle was my own; I just had to lead myself (although many of my friends responded very emotionally, as cancer forces others to think about their own mortality). When I had to deal with a very sick horse in the heat last month, it was a boxing glove moment; the tough get going and get that horse back on its feet, hose it down, get it walking, give it electrolytes, monitor its activity, and stay up long enough to make sure it’s stable. Emotional sensitivity won’t help the horse. But the owner was understandably worried and emotional, and I probably could have done a better job of being compassionate in the moment. After the horse was in the clear, I let myself be empathetic. I apologized to the owner for my “stiff upper lip” boxing glove approach to the situation. She understood, speaking of her mother-in-law talking about “putting on her boxing gloves” when dealing with a difficult situation. 


In a team situation, when the going gets tough, we may need to make room for adjustment and take time. The horse isn’t in distress. The building isn’t on fire. But we need to move smartly and quickly – often with limited information. We may need to exhibit empathy at times, listening closely. Sometimes we need to go to battle, putting on those gloves, or mobilizing for the fight as a team. At other times, we need to regroup, allow emotions to connect us. As Drucker reminds us, the most important component of crisis leadership is trust: in leadership, in each other, and in ourselves. 

 

 

Drucker, Peter F. (1990). Managing the NonProfit Organization. New York: HarperCollins Publishers. 

Duckworth, Angela (2016). Grit: The Power of Passion and Perseverance. CreateSpace Independent Publishing Platform. 

Gavin, Matt (2019). “How to Become a more Resilient Leader.” Harvard Business School Online, December 17 https://online.hbs.edu/blog/post/resilient-leadership#:~:text=Building%20resilience%20is%20vital%20to,%2C%20peers%2C%20and%20direct%20reports 

Hougaard, Rasmus, Carter, Jacqueline, Afton, Melissa (2021). “Connect with Empathy, but Lead with Compassion.” Harvard Business Review, December 23 https://hbr.org/2021/12/connect-with-empathy-but-lead-with-compassion 

Kneuer, Marianne and Wallaschek, Stefan (2022). “Framing COVID-19: Public Leadership and Crisis Communication By Chancellor Angela Merkel During the Pandemic in 2020.” German Politics, March 10 2022 https://www.tandfonline.com/doi/abs/10.1080/09644008.2022.2028140 

Petriglieri, Gianpiero (2020). “The Psychology Behind Effective Crisis Leadership.” Harvard Business Review, April 22 https://hbr.org/2020/04/the-psychology-behind-effective-crisis-leadership 

Teo, Winnie L., Lee, Mary, Lim, Wee-Shiong (2017). “The relational activation of resilience model: How leadership activates resilience in an organizational crisis.” Journal of Contingencies and Crisis Management, Sep. 25 (3), 136-147 https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7166971/ 

Weber, Max (1905). The Protestant Ethic and the Spirit of Capitalism. English Edition (1930), Talcott Parsons and R.H. Tawney, Trans. London: George Allen and Unwin Ltd. 

 


By Byron Ramirez, Ph.D. and Bo Yang, Ph.D. April 23, 2025
When we describe leaders, we often cite the importance of their ability to influence others. For decades scholars have focused their work on studying and describing how this capacity to influence works and why it tends to elicit a positive response from people, who are inspired to follow the leader’s vision. We have read about that mystifying ability to persuade others and guide them towards a common purpose. However, when analyzing the leader there is another aspect we ought to also consider - where does their power originate from, and is this power considered legitimate? What these questions intend to imply is that when we analyze the interactions of leaders and their followers, we should contemplate how their relationship is built, and moreover, how the power of the leader is used to shape those relationships. Let us first discuss what power is and why it is important. Power in its general sense is the capacity to influence, lead, dominate, or impact the actions of others. The German sociologist, Max Weber referred to power as the capacity to create a desired outcome within a social relationship. As such, power enables the leader to influence and lead the actions of people. Legitimate power is often referred to as power that the person derives from formal position or office held in the organization's hierarchy of authority. And it is this notion of authority that helps legitimatize power in the eyes of the follower. For instance, a manager has legitimate power over their subordinates, allowing them to assign tasks. Teachers possess legitimate power in the classroom, enabling them to assign grades and set learning objectives. We can then surmise that legitimate power is based on the authority granted by a position or title. And individuals will comply with requests or decisions made by the person with authority because they recognize the authority of the person holding the position. However, unlike authority, which implies legitimacy, power can be exercised illegitimately. As history shows us, there are plenty of examples where power did not originate simply from a place of authority and legitimacy, and instead flowed from coercion. Joseph Stalin and his Great Terror campaign certainly comes to mind. And although Stalin did have a position of “authority”, much of his power and influence were coercive and deceptive in nature. In fact, Stalin had used his political positions throughout his life to “remove” opponents while bolstering his image in the pursuit of greater personal power. According to biographer Robert Service (2005), Stalin took pleasure in degrading and humiliating people and kept even close associates in a state of "unrelieved fear”. Of course, there are other instances in which coercive power is used to elicit compliance. A more common example of coercive power is a manager who uses threats of demotion or termination to get employees to comply. And so, when we consider the influence a leader (manager) has, we ought to consider the very nature and source of their power. Do people follow the leader because they are truly inspired by the leader’s vision? Or do they follow because they have no other choice? Managers who threaten the job security of others to ensure compliance, leaders who exploit their positions for personal gain, or individuals who rise through favoritism rather than merit – are manifestations of illegitimate power. Regardless of context, illegitimate power tends to erode morale, limit creativity, and foster toxic environments where people operate out of fear rather than purpose. Illegitimate power wields influence without moral justification, ethical values, or the consent of those affected. And because this form of power often derives from manipulation, coercion, intimidation, or exploitation rather than genuine respect for people, it undermines trust, breeds fear, and corrodes the ethical foundations of organizations and communities. Coercive leaders who use threats, punishment, or psychological pressure to force compliance, may certainly achieve short-term results, but at a significant long-term cost. Coercion strips individuals of their autonomy and creates environments of resentment and disengagement. People may comply outwardly, but internally they may withdraw, resist, or leave. Furthermore, coercive leadership discourages open dialogue and constructive feedback, which are essential for innovation, growth, and continuous improvement. When fear becomes the primary motivator, organizations and societies become stagnant, rigid, and vulnerable to collapse. And this brings us to an important question – what does legitimate power look like? On this issue, Peter Drucker offers unique insights. In his first book, The End of Economic Man (1939), Drucker discussed the issue of legitimate power (although he did not use the term legitimate power, but rather the justification of authority). Drucker believed that the power of rulers must possess legitimacy, a tradition that has continued in Western civilization since Plato and Aristotle. In Drucker’s view, legitimate power involves a functional relationship between power, social beliefs, and social realities: does power commit to social beliefs? At the same time, can it effectively organize social reality based on that commitment to create order? In his books, Concept of the Corporation (1946) and The New Society (1950), Drucker began to use both terms legitimate power and leadership simultaneously. Drucker would go on to argue that a government that commits to the well-being of its people can be said to have legitimate power. Over time, Drucker shifted his analysis of legitimate power from the political realm to social organizations. According to Drucker, if the management of a social organization (such as a company) claims that its principal purpose is to benefit employees, this particular focus would constitute an abuse of power. Instead, Drucker argued that the primary mission of an economic organization is to always achieve economic performance, thereby contributing to society – and this is in fact, the source of the legitimacy of corporate management's power. Of course, a company is also a community. For employees, management undoubtedly holds power and must exercise it. However, the legitimacy of management’s power does not come from the commitment to benefit employees, but rather from two functions: 1. Through institutional design and innovation, shaping effective community communication, thereby enabling middle-level and lower-level employees to gain an overall vision of the organization. This allows employees to have a managerial attitude. 2. By setting clear and reasonable performance standards, prompting employees to take responsibility and achieve success through effective work. If management can perform these functions within the organization, then it is considered to exercise legitimate power. In Drucker's early works, exercising legitimate power was almost synonymous with leadership. Drucker was not enthusiastic about discussing the personal style or charm of leaders, and he was even less inclined to associate leadership with a mystifying ability to persuade others, especially if such persuasion appealed to propaganda, indoctrination, or mental manipulation. For Drucker, discussing leadership primarily meant enabling power to function effectively. Therefore, leadership is not a matter of individual leaders' techniques and styles, but rather a matter of the responsibility and function of power itself. We can surmise from these functions that legitimate power aligns with the goals, beliefs, and aspirations of the people being led. Leaders who wield this kind of power do not need to resort to threats or manipulation. Instead, they inspire, guide, and collaborate. Their authority is accepted because it is seen as fair, earned, and beneficial to the collective. It is vital to foster leaders who operate from legitimate power—power that is granted through trust, expertise, shared values, and recognized authority. Legitimate power is grounded in the formal authority granted to a manager through their role within an organization, but its true strength comes from how that authority is exercised. Unlike coercive power, legitimate power is perceived as rightful and appropriate because it is based on clear expectations, mutual respect, and established structures. When managers consistently act with fairness, integrity, and transparency, their authority is more likely to be accepted and trusted by their teams. This creates a healthy power dynamic where employees feel secure in leadership decisions, understand their roles, and are motivated to contribute toward shared goals. Managers can build legitimate power by aligning their actions with the organization's values and demonstrating competence, consistency, and accountability. For instance, making decisions that reflect the organization’s mission and treating all team members equitably strengthens a manager’s credibility. Communication is also key—leaders who listen actively, provide clear direction, and explain the rationale behind their decisions foster trust and buy-in. Investing in personal growth, staying informed, and modeling a strong work ethic all reinforce the perception that a manager has earned their position and is acting in the best interest of the team and the organization. When managers lead through legitimate power, the benefits to the organization are substantial. Teams are more engaged, morale improves, and collaboration increases because people trust the leadership and feel aligned with the organization’s purpose. This creates a positive feedback loop where employees are more likely to take initiative, innovate, and remain committed, reducing turnover and boosting overall performance. In essence, legitimate power forms the foundation of a sustainable leadership culture—one that empowers individuals, strengthens organizational integrity, and drives long-term success. Developing leaders who influence through legitimate power requires a shift in how we define and nurture leadership. It involves prioritizing emotional intelligence, ethical reasoning, transparency, and empathy. Such leaders model integrity and authenticity, aligning their decisions with shared values and long-term visions. They create environments where people feel valued, heard, and empowered. In turn, this fosters loyalty, engagement, and a strong sense of purpose. To build healthier workplaces and more just societies, we must champion leaders who embody legitimate power: those who influence not by fear, but by vision, credibility, and alignment with shared values. This approach not only promotes ethical leadership but also cultivates trust, innovation, and collective well-being. References Drucker, P. F. (1946). Concept of the corporation. New York: John Day Company Drucker, P. F. (1939). The end of economic man: A study of the new totalitarianism. New York: John Day Company Drucker, P. F. (1950). The new society: The anatomy of the industrial order. New York: Harper Service, R. (2005). Stalin: a biography. Belknap Press of Harvard University Press. Weber, M. (1965). Politics as a vocation. Fortress Press.
By Bo Yang Ph.D. April 23, 2025
In China, you can see countless interviews with successful entrepreneurs on TV, online, or in magazines. The same is true in the U.S.—probably even more so. I imagine this stylish trend must have originated in America. These interviews often show entrepreneurs sincerely talking about childhood dreams and beliefs they’ve held for decades. They’ll share how they stayed committed to those dreams and step by step made them come true. Over the past few years, I’ve had the chance to meet a few Chinese entrepreneurs—some of whom I had previously seen on TV or in magazines. Once we got to know each other better, they started sharing stories that were quite different from their media narratives. They admitted that their childhoods were hardly filled with grand dreams. What truly pushed them into business were hunger, poverty, cunning—or sometimes, just luck. I am not a nihilist, nor am I trying to say that dreams and beliefs are nothing but marketing gimmicks, exposed through off-the-record conversations. What I mean is: this is a realist world. It’s entirely possible for people to achieve business success through the pursuit of profit, intelligence, hard work, and a bit of luck. Many people don’t fully understand how they even became successful—until they already are. Of course, the world isn’t just about realism. Some people, once successful, begin to seek meaning in their lives. They want to keep doing valuable things—not just by luck, but through genuine understanding. At this point, they need to go back and reexamine what business really means. So what does business really mean? If you asked a Chinese scholar from a thousand years ago, he would most likely say that business is linked to something like original sin. Of course, Chinese culture doesn’t contain the Christian idea of original sin, but when talking about commerce or merchants, scholars would often describe businesspeople as inherently tainted by something spiritually corrupt. If you asked a classical economist like Adam Smith, you’d get a much more generous answer. Classical economists openly accept the profit motive as part of human nature, and they’d go further to say that this motive is a major driver of civilization. The accumulation of social wealth, improved quality of life, and progress of civilization all rely on individuals—driven by profit—to create rules, use their talents, and generate value. After classical economics, this line of thinking became the default lens for understanding business and commercial civilization. Even though Marxism and Nazism have violently attacked the profit motive, modern commercial civilization has not only survived—it has thrived. The great achievement of classical economics was to build a causal relationship between the pursuit of profit and the progress of civilization. But the question remains: is that all there is? The entrepreneurs I know, who fought their way through tough business landscapes, would never doubt the role of the profit motive. But some of them also have a vague sense that business isn’t just about making money. After a few successful ventures, some start to long—consciously or unconsciously—for cleaner businesses, meaningful businesses, even beautiful ones. They may not be able to articulate this impulse, so instead, they go on TV or into magazines and talk about childhood dreams and ideals. These aren’t real memories—they’re symbolic stories. What exactly drives commercial civilization? Peter Drucker agreed with the classical economists, but only halfway—because they only got it halfway right. Drucker never denied the profit motive. But he believed that all successful business activity is a discovery and creation of order. And that’s what makes it so important. Not only do entrepreneurs and managers need to rethink the meaning of business, but ordinary citizens in modern society do too. Drucker’s book Managing for Results, published in 1964, is still seen by many as a hands-on business guide—and rightly so. Few of his works are as focused on practical application, packed with diagrams and terminology. But what’s truly interesting about the book is how, while walking readers through practical operations, Drucker is also helping them rethink what business actually is. He starts right where most businesspeople do—with the desire to make money. But he warns: not every boss who makes money actually understands how they made it—or which products brought in the profit. To figure that out, they have to understand their business as a whole. But doing that means stepping out of personal ego and illusions of success. It means knowing which accounting method reveals the truth. It means identifying which products are making money—and then asking why. And the right way to find out why a product makes money isn’t to ask the product manager, engineer, or designer—it’s to understand the customer’s needs. If the boss and the product manager are serious about understanding the customer, they’ll realize the customer isn’t buying a product—they’re buying value, value that meets a particular need. And customer needs change constantly—just like the weather. Even the smartest people can only partly predict these shifts. The wise approach is to treat change as a given and figure out how to deal with it, manage it, and adapt to it. Once they accept this truth, bosses and managers begin to see the market differently. Results are not things created inside a company—they’re things selected by customers in the marketplace. Profit isn’t wealth created by the company and kept by it; it’s a risk buffer that allows the company to stay in the market. Innovation isn’t a CEO suddenly struck by inspiration; it’s people with entrepreneurial spirit using new combinations of resources to meet customer needs and produce performance. A boss who’s serious about business—and honest about reality—can start out wanting to make money and end up with an entirely new perspective, and a deeper understanding of business. At the end of Managing for Results, Drucker wrote something striking. He believed that not only entrepreneurs and managers need to understand business—they have a responsibility to help the public understand it too. They must become educators in civil society. Even today, in modern, industrialized nations with booming economies, many well-educated citizens still don’t understand business. They look down on it. Some even hate it. They don’t lack conscience—if anything, they’re overflowing with it—but they lack imagination and understanding. They don’t see that business is actually a form of rational exchange and creative mutual benefit between people. And because they don’t understand this, they not only despise business—they become impatient with any kind of rational exchange or creative collaboration. Instead, they get used to imposing their moral preferences on others. That kind of moral arrogance keeps producing hatred and division in modern society. Of course, Drucker didn’t believe business could solve all of society’s problems. But he did believe that the motive behind commercial civilization isn’t only about profit. He also believed that civilized business itself is a form of education for modern society. Because civilization—no matter where it appears—always involves understanding, creating, sharing, and exchanging organizational frameworks. As he wrote: “The economic task, if done purposefully, responsibly, with knowledge and forethought, can indeed be exciting and stimulating, as this book has, I hope, conveyed. It offers intellectual challenge, the reward of accomplishment, and the unique enjoyment man derives from bringing order out of chaos.” Drucker often quoted the British philosopher Alfred North Whitehead (1861–1947). As far as I know, Whitehead may be the only modern philosopher—besides Drucker—who truly understood the beauty of business. In his 1925 book Science and the Modern World, Whitehead wrote something strikingly similar: “Art is not limited to sunsets. A factory—by virtue of its machines, its community of workers, its service to the general public, its reliance on organizational and design genius, and its potential as a source of wealth for shareholders—is a living organism rich with value.” But Whitehead also said something even more important, in The Adventure of Ideas (1933): “Plato was right: The creation of the world—the world of civilized institutions—is the victory of persuasion over force.” And business civilization—especially the kind that Drucker and Whitehead envisioned, one that creates order and beauty—is perhaps the most brilliant demonstration of how persuasion can triumph over conquest.  As Drucker said, it’s not just businesspeople who need to understand this. Every citizen of the modern world should too. Because even now, the opposite impulse is still alive—the desire to replace persuasion with conquest and turn business into a game of domination.
By Robert Kirkland Ph.D. April 21, 2025
When Satya Nadella assumed the role of Microsoft’s Chief Executive Officer in February 2014, the company was experiencing the early symptoms of organizational sclerosis. Though still profitable, it had lost ground to more agile competitors in the mobile and cloud sectors. Internally, Microsoft had become fragmented—defined more by turf battles than innovation. The challenges Nadella inherited resembled those Peter Drucker articulated decades earlier in his conceptualization of the Functioning Society of Institutions (Drucker, 1946). Drucker’s view—deeply shaped by the failure of social cohesion in interwar Europe—called for institutions to reorient themselves not just around efficiency, but around meaning, moral purpose, and self-development. Nadella’s Microsoft has arguably become one of the clearest corporate embodiments of Drucker’s philosophy of Management as a Liberal Art (Drucker, 1989). Much of Nadella’s success can be attributed to his emphasis on empathy and cultural reinvention. Prior to his appointment, Microsoft was widely seen as a combative, insular organization (Lohr, 2014). Nadella moved swiftly to change this. In his internal communications and public interviews, he spoke often of empathy—not as a rhetorical flourish, but as a managerial imperative. This commitment mirrored Drucker’s belief that management must engage the whole human being, acknowledging both rational capability and emotional complexity (Drucker, 1989). Drucker emphasized that organizations ought to be places where people grow in both skill and character. Nadella’s redefinition of leadership as empathetic listening and continuous learning operationalized that belief in a modern, corporate context. At the center of Nadella’s early cultural transformation was the introduction of a "growth mindset," a concept he borrowed from psychologist Carol Dweck (Dweck, 2006). Employees were encouraged to ask questions, seek feedback, and approach problems with humility. Drucker had long argued that a functioning institution required the cultivation of self-awareness and wisdom (Drucker, 1993). Nadella, in fostering a company-wide learning orientation, aligned Microsoft's trajectory with the MLA principle that personal development and organizational mission must progress hand-in-hand. The result was an environment that encouraged intellectual humility without sacrificing performance. Equally important in understanding Nadella’s alignment with Drucker’s MLA framework is the redefinition of Microsoft's mission. Under Steve Ballmer, the mission had been tightly product-focused: "a PC on every desk and in every home." Nadella’s version was broader and more aspirational: “to empower every person and every organization on the planet to achieve more” (Microsoft, 2017). Drucker might have called this a shift from a narrow economic mandate to a wider societal purpose. In The Concept of the Corporation, Drucker (1946) warned against corporations existing as islands of profit, detached from community responsibilities. Nadella’s mission reframed Microsoft not just as a tech vendor but as a social actor—a stakeholder in global development. Drucker’s emphasis on function and status within a functioning institution also finds modern expression in Nadella’s restructuring of Microsoft's performance evaluation system. The previous stack-ranking model—which pitted employees against each other—was scrapped (Wingfield, 2013). It had rewarded individual performance over team cohesion, eroding trust and stifling creativity. Nadella implemented a performance system that rewarded collaboration, curiosity, and contributions to others’ success. This pivot acknowledged Drucker’s claim that organizations succeed not when individuals compete within them, but when their actions contribute meaningfully to a shared mission (Drucker, 1989). In accordance with Drucker’s MLA principle that organizations must exist within society—not apart from it—Nadella also led Microsoft into a new era of corporate social responsibility. Under his watch, Microsoft committed to becoming carbon negative by 2030, developed AI tools for accessibility, and began publicly advocating for ethical technology development (Microsoft, 2020). Drucker (1999) asserted that institutions must balance individual rights with societal duties. Nadella’s policies gave concrete expression to this ideal, embedding corporate ethics into strategy, not as appendages but as essential elements of long-term resilience. Crucially, Nadella has approached leadership with the recognition that authority alone does not confer legitimacy. Drucker emphasized the importance of persuasion over coercion, process over fiat (Drucker, 1990). Nadella, rather than enforcing top-down directives, frequently invites employee participation in major shifts. Microsoft’s move into open source software—once unthinkable—was carefully socialized within the organization and presented not as an edict, but as a necessary cultural and business evolution (Miller, 2018). The broader implications of Nadella’s leadership can be understood through Drucker’s transdisciplinary lens. Drucker saw management as a “liberal art” because it required the application of ethics, psychology, history, and even theology in decision-making (Drucker, 1989). Nadella frequently cites literature, philosophy, and biography in his public remarks. His personal reflections often involve moral and philosophical introspection, underscoring Drucker’s belief that leadership is a humanistic endeavor requiring breadth of thought and emotional depth (Nadella, 2017). Despite Microsoft’s technological focus, Nadella’s management philosophy resists technocratic reductionism. His belief that people—not platforms—are the key to innovation affirms Drucker’s warning that effective management is not merely quantitative but judgment-based (Drucker, 1990). Microsoft’s market capitalization under Nadella has more than tripled, underscoring that an ethical, human-centered organization is not incompatible with economic success (Nasdaq, 2024). As Drucker argued in The New Realities, leadership in a knowledge society must move beyond command structures and embrace complexity, diversity, and continual learning (Drucker, 1989). Nadella has not only embraced these values—he has embedded them into Microsoft’s organizational DNA. His leadership demonstrates that Management as a Liberal Art is more than a theoretical framework; it is a viable, proven, and necessary strategy for organizational renewal and social relevance in the 21st century. References · Drucker, P. F. (1946). The concept of the corporation. New York: The John Day Company. · Drucker, P. F. (1989). The new realities: In government and politics, in economics and business, in society and world view. New York: Harper & Row. · Drucker, P. F. (1990). Managing the non-profit organization: Practices and principles. New York: HarperBusiness. · Drucker, P. F. (1993). Post-capitalist society. New York: HarperBusiness. · Drucker, P. F. (1999). Management challenges for the 21st century. New York: HarperBusiness. · Dweck, C. S. (2006). Mindset: The new psychology of success. New York: Random House. · Lohr, S. (2014, February 4). Satya Nadella, Microsoft’s new chief, is a company man. The New York Times. https://www.nytimes.com/2014/02/05/technology/satya-nadella-named-chief-of-microsoft.html · Microsoft. (2017). Our mission. https://www.microsoft.com/en-us/about · Microsoft. (2020). Microsoft will be carbon negative by 2030. https://blogs.microsoft.com/blog/2020/01/16/microsoft-will-be-carbon-negative-by-2030/ · Miller, C. C. (2018, October 22). How Satya Nadella remade Microsoft as an open source company. The New York Times. https://www.nytimes.com/2018/10/22/technology/microsoft-open-source.html · Nadella, S. (2017). Hit refresh: The quest to rediscover Microsoft’s soul and imagine a better future for everyone. Harper Business. · Nasdaq. (2024). Microsoft Corporation (MSFT) stock performance. Nasdaq.com. https://www.nasdaq.com/market-activity/stocks/msft · Wingfield, N. (2013, November 12). Microsoft alters employee review process. The New York Times. https://www.nytimes.com/2013/11/13/technology/microsoft-alters-employee-review-process.html
Show More