A new study co-authored by WHU professor Serden Ozcan provides exclusive, in-depth insights into current challenges of German corporate leadership teams. With their paper titled "German Corporate Leadership in Disruptive Times: Corporate Playbooks, Frustrations and Challenges” the researchers have developed a practical guide for leadership teams, as well as a set of core disciplines designed to help these teams navigate successfully through major disruptions.
In today’s business world, corporate decision-makers are facing numerous complex and discontinuous business challenges, so called “disruptions” instigated by technology, market, business and institutional forces. To stay successful in the long run, companies need to be able to diagnose and manage these disruptions in advance. For their study recently published by Alvarez & Marsal (A&M), Professor Serden Ozcan, Chair of Innovation and Corporate Transformation at WHU - Otto Beisheim School of Management and A&M Managing Director Patrick Siebert investigated how some of Germany’s most prominent corporations are handling disruptions. The researchers aimed to get an understanding of corporate leaders’ playbooks, frustrations and challenges. Ozcan and Siebert conducted 20 exclusive face-to-face interviews with members of the supervisory boards and top management teams of some of Germany’s largest and most prominent businesses, such as Adidas, Bayer, Lufthansa, Deutsche Bahn, Infineon, ProSiebenSat.1, ThyssenKrupp or Allianz. The companies selected are active in a number of industries, including retail, steel, technology, consumer goods, chemicals, media, e-commerce, energy and real estate.
The research team aimed to better understand the roles played by supervisory boards and management teams, the contributions they make, the playbooks they use and the challenges and frustrations they face during times of disruption. Ozcan and Siebert focused on prominent German businesses as the country’s leading businesses are highly diverse, and active in industries that are experiencing disruption especially fast. Germany additionally makes for a valuable investigation case, as corporate governance has idiosyncratic attributes, such as a dual board structure, and supervisory boards that are made up of non-executive members only.
The study provides valuable, hands-on knowledge for management in German corporations. With insights from their interviews, Ozcan and Siebert defined five essential qualities a truly effective CEO in disruptive times should possess: they are unusually astute, have an entrepreneurial mindset and attitude, maintain discipline and accountability, know their limitations and have mastered the art of power. These qualities shape and govern their playbooks. While CEOs matter, the study also revealed that the collective contributions of German management teams to the evolution and well-being of the company are often overlooked. A grave mistake, since management board members can greatly influence how organizations cope with disruption. Next to helping the CEO develop the most appropriate courses of action to fend off disruptive tides, they can facilitate and make those critical balancing acts easier for CEOs to perform. The paper therefore also summarizes the pattern of qualities that define ideal management teams who can win the battle against disruption in difficult and turbulent times. The study additionally provides a list of ideal profiles of supervisory boards and their chairs for times of systemic disruptions as well as ideal profiles of management teams for disruptive times.