What Matters Now

What Matters Now Plot Summary

Introduction

In a world of relentless change, ferocious competition, and unstoppable innovation, business leaders must focus on what truly matters. The conventional management wisdom that served organizations well in more stable times is increasingly inadequate for today's challenges. This book presents a multifaceted agenda for thriving in our dynamic environment by addressing five crucial areas: values, innovation, adaptability, passion, and ideology. The financial crisis revealed how easily our systems can collapse when fundamental values are compromised. Meanwhile, the accelerating pace of change demands organizations that can adapt quickly while fostering continuous innovation. To succeed, companies must tap into the passion of their employees and challenge the outdated management ideology that prioritizes control over creativity and freedom. By examining each of these dimensions and providing concrete examples from pioneering organizations, we can build enterprises that are not just efficient and disciplined, but also adaptable, innovative, inspiring, and noble.

Chapter 1: Values: The Moral Foundation of Business in Crisis

At the heart of many recent business failures lies a moral crisis. The global financial meltdown wasn't merely a banking crisis or credit crisis—it was fundamentally a failure of values. When executives prioritize short-term personal gain over long-term organizational health, when companies exploit customers rather than serve them, and when leaders view their position as an entitlement rather than a responsibility, the entire system becomes vulnerable. The concept of stewardship offers a powerful antidote to this moral decay. True stewards demonstrate fealty (viewing resources as a trust), charity (putting others' interests first), prudence (safeguarding the future), accountability (taking responsibility for systemic consequences), and equity (ensuring rewards correspond to contributions). These virtues have become increasingly rare in corporate leadership, yet they form the essential moral foundation upon which sustainable business success must be built. In our interconnected global economy, the consequences of ethical failures are magnified. One company's moral lapse can trigger industry-wide crises, destroy public trust, and invite regulatory backlash. The widespread cynicism about business is reflected in surveys showing that barely 15% of respondents rate executives' ethical standards as "high" or "very high." This erosion of trust represents an existential threat to capitalism itself. Reclaiming moral leadership requires organizations to challenge the dangerous conceits that have come to dominate business thinking: that maximizing shareholder wealth is the paramount objective, that executives should only be accountable for immediate effects of their actions, that short-term earnings matter more than long-term value creation, and that doing good is only justified when it helps do well. These toxic assumptions must be replaced with a more enlightened view that recognizes the convergence of stakeholder interests and embraces a broader sense of corporate purpose. The values revolution has already begun. Between 2005 and 2010, assets invested in socially responsible funds grew 34% while total assets under management grew only 3%. Today, one dollar in eight is invested with social considerations in mind. Organizations that hope to thrive must embrace a noble purpose that transcends mere profitability and efficiency. When corporate leaders recognize that excellence requires more than technical competence—that it demands moral courage and commitment to timeless values like honesty, fairness, and respect—they will build companies deserving of society's trust.

Chapter 2: Innovation: Creating Value Beyond Commodity Knowledge

In today's creative economy, innovation is the only sustainable strategy for creating long-term value. Yet despite widespread recognition of its importance, few organizations have made innovation everyone's job, every day. Most companies still treat innovation as an occasional activity practiced by a select few rather than a continuous process involving the entire organization. Innovation isn't a luxury—it's an existential necessity. We owe our very existence to innovation, as four billion years of genetic experimentation through sexual recombination and random mutation have produced the complexity of human life. Our prosperity stems from centuries of social, institutional, and technological innovation that has lifted billions from subsistence living. Our happiness depends on our ability to create and innovate, which fulfills a fundamental human need. And our future requires new innovations to address unprecedented challenges from climate change to global pandemics. The world's most innovative companies fall into several distinct categories. The "rockets" are young companies propelled by novel business models, like Hulu or Spotify. While they're often celebrated for their creativity, many fail to develop systematic innovation capabilities as they mature. The "laureates" like Intel and Samsung focus on technological mastery within narrow domains, investing billions in R&D and dominating patent rankings. The "artistes" like IDEO specialize in creativity as their primary product. The "cyborgs" including Google, Amazon, and Apple seem purpose-built for innovation, with management practices centered on principles like freedom, meritocracy, and experimentation. Perhaps most instructive are the "born-again innovators" like Procter & Gamble, IBM, and Whirlpool—established companies that have successfully transformed their innovation capabilities. These organizations demonstrate that the primary barrier to innovation isn't a lack of resources or creativity but a shortage of pro-innovation processes. Whirlpool, for example, recrafted all its management processes around innovation, creating a pipeline worth over $4 billion in seven years. Great design represents a particularly powerful form of innovation. It evokes a visceral reaction because it's utterly unexpected, amazingly competent, aesthetically exquisite, and conspicuously conscientious. Companies like Apple demonstrate how design thinking—careful observation, experimentation, and rapid prototyping—can transform mundane products into objects of desire and create extraordinary customer loyalty. The perceptual habits of successful innovators can be cultivated throughout an organization. These include challenging industry orthodoxies, appreciating emerging trends, leveraging underleveraged competencies and assets, and uncovering unarticulated customer needs. With proper training and practice, ordinary employees can become extraordinary innovators capable of generating breakthrough ideas that combine radical novelty with practical feasibility.

Chapter 3: Adaptability: Building Organizations Resilient to Change

The pace of change has gone hypercritical. Exponential growth characterizes everything from mobile phone adoption to data storage to knowledge itself. In this maelstrom of transformation, the most important question for any organization is whether it's changing as fast as the world around it. For most companies, the honest answer is "no." Corporate history is littered with once-dominant companies that failed to adapt. Consider the mobile phone industry: leadership passed from Motorola to Nokia to RIM to Apple in just four decades. The problem isn't that companies don't change at all—it's that change tends to come in only two varieties: the trivial and the traumatic. Most organizations experience long periods of incremental fiddling punctuated by occasional bouts of frantic, crisis-driven transformation. This pattern persists because our organizations were never built to be adaptable. The management pioneers of a century ago designed companies for discipline and efficiency, not resilience. They understood that routinizing the nonroutine improves productivity, but adaptability requires occasionally abandoning those routines—something most management systems actively discourage. Three forces typically drive organizational decline. First, the laws of physics work against sustained success: the law of large numbers makes growth harder as companies expand, the law of averages ensures that outperformance eventually regresses to the mean, and the law of diminishing returns reduces the impact of improvement initiatives over time. Second, strategies die through replication (competitors copy them), supersession (better strategies emerge), or evisceration (margins get squeezed by powerful customers or new competitors). Third, success itself corrupts through defensive thinking, inflexible business systems, fossilized mental models, resource abundance, and a sense of contentment and entitlement. Building adaptability requires a fundamental shift in organizational DNA. Companies must develop anticipatory capabilities by facing inevitable changes, learning from the fringe, and rehearsing alternate futures. They need intellectual flexibility through challenging assumptions, investing in diversity, and encouraging vigorous debate. Strategic variety comes from building portfolios of new options, becoming magnets for great ideas, and minimizing experimentation costs. Structural flexibility demands avoiding irreversible commitments, investing in adaptability, and thinking in terms of competencies and platforms rather than specific products. Perhaps most importantly, organizations need resilience-friendly values. They must embrace grand challenges that draw people toward change, embed management principles derived from naturally adaptive systems like biological ecosystems and markets, and honor web-inspired values like transparency, meritocracy, openness, and collaboration. The task is daunting, but the alternative—periodic crises and potential extinction—is far worse.

Chapter 4: Passion: Unleashing Human Capability in the Workplace

Only 21% of employees worldwide are truly engaged in their work, according to a comprehensive global survey. This represents management's dirty little secret: despite all the rhetoric about empowerment and engagement, most organizations fail to inspire the passion, creativity, and initiative of their workforce. This disengagement isn't merely an HR problem—it's a fundamental competitive liability. In today's creative economy, competitive advantage comes from non-commodity knowledge—the unique insights and innovations that create distinctive customer value. Apple's extraordinary profitability with the iPhone resulted not from the commodity components it shares with competitors, but from the non-standard knowledge it added in design, user experience, and ecosystem development. This type of differentiation requires employees who are not merely obedient, diligent, and competent, but also initiative-taking, creative, and passionate. Traditional management approaches focus on controlling behavior rather than unleashing potential. They assume organizations should come first and individuals second. But this equation must be reversed. Instead of asking how employees can better serve the organization, leaders must ask how organizations can be redesigned to merit the extraordinary gifts that employees could bring to work. The goal must be to create work environments that inspire exceptional contribution and deserve an outpouring of passion, imagination, and initiative. Building human-centered organizations requires placing individuals ahead of institutions. Large companies and government agencies often operate with deep mistrust of employee commitment and competence, enforcing compliance through elaborate control systems. Yet when employees feel marginalized by managers who seem deaf to their concerns, trust erodes and engagement plummets. Reversing this pattern means embracing principles like decentralization, community over hierarchy, transparency in decision-making, leader accountability to the led, alignment of rewards with contribution, peer review, and expanded self-determination. Communities of passion offer a powerful alternative to traditional hierarchical structures. When St. Andrews Church faced declining membership despite professional programming, assistant vicar Drew Williams pioneered Mission-Shaped Communities—medium-sized, self-directed groups focused on serving their local communities. By giving members freedom to define their own missions and operate with minimal oversight ("low control and high accountability"), the church unleashed tremendous creativity and growth, doubling its congregation in just a few years. Even traditional organizations can begin reversing the "ratchet of control" that steadily accumulates rules and restrictions. When Chris Bayliss, general manager for retail banking at the Bank of New Zealand, empowered store managers to set their own hours rather than follow centralized dictates, he triggered a revolution in employee autonomy. Store managers enthusiastically experimented with schedules that better served their communities, and this initial freedom led to further innovations as employees felt trusted to make decisions about their own operations.

Chapter 5: Ideology: Challenging Management's Control-Centric Paradigm

The ideology of management rarely gets examined, yet it profoundly shapes our organizations. The first synonym for "manage" in most languages is "control," revealing management's ideological core. This control orientation reflects management's origins in the industrial revolution, when engineers and accountants fought waste through division of labor, standardization, optimization, monitoring, and efficiency-focused compensation—all weapons in the arsenal of control. This ideology found organizational expression in bureaucracy, which Max Weber celebrated for its "precision, stability, stringency of discipline, and reliability." These qualities enabled unprecedented productivity gains, but in today's rapidly changing environment, they're merely table stakes. The challenges of accelerating change, intense competition, knowledge commoditization, and social accountability demand organizations that are passionate, creative, and malleable—qualities inversely correlated with bureaucratic control. The problem isn't control per se, but organizations that are overcontrolled and wrongly controlled. Most management processes were designed with efficiency in mind, not adaptability or innovation. They value conformance over creativity, predictability over experimentation, and stability over renewal. Despite decades of talk about empowerment, Theory Y, and employee engagement, our organizations remain ideologically asymmetrical, with the creed of control reigning supreme. Freedom offers a viable philosophical rival to control. Companies like W.L. Gore demonstrate how organizations can thrive without formal hierarchies, bosses, or titles. Founded in 1958 by Bill Gore, who wanted to create a company where the entire organization felt like a skunk works, Gore operates as a lattice or network rather than a pyramid. Leaders emerge based on their ability to attract followers rather than through top-down appointment. Associates self-commit to projects that interest them but are held accountable by peers for delivering results. Morning Star, the world's largest tomato processor, offers another radical alternative to traditional management. With no supervisors or formal hierarchy, the company operates through a web of commitments formalized in Colleague Letters of Understanding (CLOUs). Every employee articulates a personal mission statement aligned with the company's purpose and negotiates specific commitments with colleagues affected by their work. Employees manage their own purchasing decisions, hire colleagues when needed, and participate in a rigorous peer-review process that ensures accountability. HCL Technologies demonstrates how even a large, established company can reinvent its management model. CEO Vineet Nayar championed "employees first, customers second" by systematically inverting the pyramid of power. HCLT created transparency by giving every employee detailed financial data, established online forums for questioning leadership decisions, implemented service level agreements between staff functions and frontline employees, instituted open evaluations where managers could be rated by anyone affected by their decisions, and formed self-organizing employee councils around key issues. These pioneering organizations prove that alternatives to traditional management exist and work. They resolve the tension between freedom and discipline not through compromise but through new mechanisms that enable coordination without centralization, accountability without hierarchy, and control that comes from within rather than without. Their success challenges us to imagine organizations that magnify rather than diminish human capabilities—organizations that are as adaptable, innovative, and inspiring as the people who work within them.

Summary

The five dimensions explored in this book—values, innovation, adaptability, passion, and ideology—form an integrated agenda for thriving in our era of relentless change. Each represents a critical arena where conventional management thinking must be challenged and reinvented. The companies that will succeed in the future are those that embed moral purpose in their operations, make innovation everyone's responsibility, develop the capacity to change ahead of the curve, create environments that inspire extraordinary contribution, and balance the need for control with the liberating power of freedom. The quest to build organizations that are simultaneously efficient and adaptable, disciplined and creative, focused and experimental represents management's defining challenge. The examples of Gore, Morning Star, and HCL Technologies demonstrate that this isn't merely theoretical—it's achievable through bold reimagining of management fundamentals. The revolution begins not with grand plans but with questioning basic assumptions about how organizations should function and experimenting with alternatives that better serve both human potential and competitive imperatives. Those who lead this transformation will build organizations that are not just commercially successful but also deeply human—places where people can bring their full selves to work and collectively create something extraordinary.

About Author

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Gary Hamel

Dr. Gary P. Hamel is an American management expert. He is a founder of Strategos, an international management consulting firm based in Chicago.Gary Hamel is Professor of Strategic Management at London Business School. He has researched strategy development in a multinational context.

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