Leadership of the future – Hermann Arnold

“In the future, employees must be able not only to follow but also to lead.” 

A conversation with Hermann Arnold about the leadership models of the future, a new role distribution and collaboration between people and machines.


What do you mean by “repertoire of leadership methods”?  Can you give us an example?
We usually just think of management in a single way: the heroic leader, like Obama, Jobs or Musk. Music illustrates the different ways in which management can work. There is a front woman or a front man, such as Madonna or Leonard Cohen. This one person makes all the essential decisions, everyone else works towards that. Then there’s the orchestra. Conductors, who can have very different leadership styles, set up the framework and temporarily delegate the leadership – but they also take it back. Then there’s the band, let’s say Abba or the Beatles. For certain pieces – in the business world we would say tasks – every person takes over the leadership. And then there’s jazz. Here everyone leads according to the situation. But there are strict rules that you have to adhere to when you lead. Aeroplane pilots use a similar system. Depending on the situation, the pilot or the co-pilot leads. The transfer of leadership happens according to a clear process. The pilot handing over control says “your plane” and the pilot taking it over says “my plane”. It’s similar with police activities. While driving to the operating location, the team decides who will lead the operation. This is certainly not always the oldest, most experienced or best person. During the operation, everyone follows this temporary leader. There are no meta-discussions along the lines of “wouldn’t it be better if…?” Any criticism of the operation and shared learning happen afterwards in a group discussion.

On the Haufe blog, I immediately noticed the statement “EMPLOYEES RUN COMPANIES”. This paints an intriguing picture!  
True, that’s a big element on our blog. As I see it, another big change – or the major change – in the management area will be that we will ALL lead at EVERY company in the future. We call this shared management. By this I mean not only that managers will lead their employees and teams but that projects must also be managed. And since there are no longer hierarchical structures in project work these days – and everything still needs to move forward – it follows that the project employees also have to learn to lead. In the future, employees must be able not only to follow but also to lead. Instead of complaining to supervisors about their colleagues, for example, they will have to take on responsibility themselves. Not in the sense of disciplining others, but insofar as they have to offer each other help to improve themselves. In the past employees had mentally delegated many things to the top; now they have to solve them on their own responsibility. In brief – we all have to learn how to lead and to follow.

What exactly do you mean by follow?
There are many employees who only see their supervisors as lightning rods or scapegoats – for anything that runs badly. But instead they should share responsibility for the decisions of their bosses. Of course not without being able to give feedback. It simply means taking supervisors seriously in their roles and encouraging their competencies. Conversely, however, supervisors also have to learn to follow their employees when they have delegated certain tasks to them. I understand “delegating” as meaning that you don’t just order the completion of the task but also hand over responsibility. And if supervisors delegate, they also have to follow. So the future of work will be dispersed leading and dispersed following. If every individual can take on responsibilities and advance the project, it offers enormous opportunities to the company.

How can it work that everyone leads and everyone follows in the whole organisation and the entire company still functions?
It’s like road traffic. With rules. It’s about developing organisational forms that work like clubs or play groups among peers. With the expedient integration and configuration of the three dimensions organisational design, infrastructure and competence. Then collaboration at the company will automatically run in a much more agile manner. Good examples for cooperation functioning in an agile, self-organised way without fixed hierarchical structures include volunteer work, in an extreme case also a crisis situation or – to name a corporate example – Linux. The operating system for Internet servers was successfully developed and improved by many volunteers – and Linus Torvalds was far from making all the major decisions itself. There are already individual companies that are thinking and implementing organisations in a new way. Of course there is still a great need for experimentation here. We need to get away from old leadership structures to new models of self-organisation, for example. Although we don’t have the clearly formulated rules or infrastructure yet, this new form of cooperative work can be overseen and regulated with the tools that will be provided by us by technological progress. Just like at a driving school, you then have to relearn and repeatedly practice the rules of cooperation – without having to take a test for it.

Why should companies actually let go of the old management structures?
For one, because you simply have the right tools or technical opportunities to run an organisation in a new way, and for another, because it’s necessary. The organisational forms that we had in the past will no longer suffice, because they aren’t flexible or fast enough anymore to respond to the requirements of the highly volatile market. Because of the digital disruption, companies are confronted with the possibility that new strong competition will pop up in the market from one day to the next. To stay competitive, the companies are forced to react more quickly and be more agile while also becoming more innovative. For this they have to reorganise themselves, become smaller and more horizontal and cooperate strongly in networks. But above all, they should use the potential of all employees and also give them the freedom and obligation to take charge and move forward with tasks on their own.

If we take a look not only at collaboration between people but also collaboration between people and machines, who will lead whom and who will follow in the future?
An exciting topic. MIT conducted an experiment on this. The hypothesis was that cooperation between people and machines works best if the machine completes the “stupid” tasks and people take over the “intellectual” work, for example the planning or control. The result was intriguing, because productivity was highest when the machine had planned and assigned the tasks. The machine was basically the boss. Interestingly, employees were also most satisfied in this constellation. One explanation for this is: When people have other people assign them tasks that they don’t really like to do, they think that their supervisors don’t like them, that they’re idiots and only do this to annoy them. But when a machine assigns the tasks, the people accept the tasks that they don’t like much more easily, since it’s clear to them that the machine determines the task allocation with the help of an algorithm and that the distribution thus makes sense. No emotions are attributed to machines, which makes it easier for people to accept decisions. In my opinion, cooperation will exist in very different constellations and with different roles. We’ll get used to getting advice from computers and at some point the duo of people and machines will become better at everything than people or machines alone. Until we have reached the so-called singularity and machines will be better than people at everything.

And then what…? What awaits us humans when we are completely inferior to machines?
Very smart people are already considering what will come after, but they haven’t been able to find an answer so far. So the future will continue to be intriguing.

Hermann Arnold is an Austrian entrepreneur, co-founder and chairman of Haufe-umantis AG in St. Gallen/Switzerland. He studied business economics at the University of St. Gallen and gained an international reputation as a pioneer and lateral thinker in the area of Human Resource Management. When companies are founded and in social initiatives, Arnold is involved as a co-founder, mentor  and sometimes investor. As cofounder of Haufe-umantis AG, he sees himself as an explorer and encourager of innovative organisational forms, which he and his colleagues also test at their own company and together with their clientele. His special flair for trends always benefits him in these roles. He also draws on this when pursuing two other great personal interests: education and politics.

OUR BOOK RECOMMENDATION: Wir sind Chef – Wie eine unsichtbare Revolution Unternehmen verändert (“We’re the Boss – How an Invisible Revolution Is Changing Companies”) by Hermann Arnold

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