IPP 2020: A New Context for Power?

Powerful people, especially those of the larger than life variety, do not accept the status quo. They are driven to influence, disrupt, and shape the world around them; sometimes they “make” history. But power does not exist in a vacuum. Any era has its own irresistible currents that provide the context in which powerful people operate; these forces will empower some and obstruct others. Thus, understanding the times is critical - both for powerful people themselves and those seeking to influence them.

I believe that three overarching trends provide the power context as we enter the 2020s.

Digitalization

Data and digital technologies are transforming businesses, institutions, and societies at breakneck speed. Klaus Schwab, the Executive Chairman of the World Economic Forum, has coined the term Fourth Industrial Revolution to describe a world where data is the “new oil” and technology disruption affects virtually any sector. As a result, data driven companies such as Amazon, Apple, Facebook and Google have amassed unprecedented power, and 5 of the world’s top 10 billionaires (Jeff Bezos of Amazon, Bill Gates of Microsoft, Mark Zuckerberg of Facebook, Larry Ellison of Oracle, and Larry Page of Google) come from the world of technology. All of them are Americans (and all of them are men). Yet American tech supremacy is being challenged by China which is emerging as a new center and driver of technology innovation. Companies like Baidu (internet), Alibaba (online services), and Tencent (Wechat) have become formidable competitors. Chinese telecom giant Huawei has become the object of intense global attention, scrutiny, and controversy. European companies, on the other hand, are running the risk of being digitally left behind. Strict privacy regimes, lack of venture funding, and “sheer fear” are among the reasons cited. And it is true: The inherent tension between “data-driven” and privacy will become a bigger factor for data driven companies, at least for those based in the West. It will take a lot of traditional, i.e. “human,” intelligence to figure this tension out.

Given the rise of tech, the leaders of the digital age will no doubt be very smart - or as we said in IPP 1.0, nothing short of “brilliant.” And anyone who is looking to influence powerful people in an age where data is king will be well advised to obtain at least a minimum of “data literacy.” But - and maybe somewhat surprisingly - the powerful people of the tech age are equally adept at old fashioned people skills. According to a BBC profile, Jack Ma, co-founder and former Executive Chairman of Alibaba, has no particular background in technology. Instead, his charisma, strategic vision and ability to convince people are said to be his biggest assets. And, like many founder-type leaders, he is propelled by a vision “beyond money.” Having stepped down from Alibaba, Jack Ma has now become a champion for innovation and young entrepreneurs in Africa being convinced that the digital revolution has the potential to drive tremendous prosperity for the continent. A powerful person with a powerful, digitally inspired, vision.

Climate Change

After taking over as EU Commission President in 2019, Ursula von der Leyen, former German defense minister and mother of seven, identified two priorities for the coming decade: Digitalisation (thus confirming trend #1) and climate change. There can be no doubt: Few other topics have created more widespread concern, controversy and existential angst. In a latest development, British psychologists have warned that children are increasingly suffering “anxiety and grief” about climate change or so-called “eco-anxiety.” Some will put climate change even at the top of the 2020’s trends, and we must expect that it will shape a large part of the political, business and societal agenda with increasing urgency.

The reverberations of climate change are already ubiquitous: It has spawned a global protest movement whose most visible protagonist, Greta Thunberg, inspires students, politicians, and scientists alike; never, it seems, has a “protestor” been more embraced by the establishment, or at least part of it. Climate change action has put entire industries under siege. This ranges from Germany’s vaunted auto industry, now accelerating a feverish transition from internal combustion to electric to Canada’s oil-patch having to fight for pipelines and ultimately survival. The issue is far from being embraced by just protesters, activists, and politicians. It also gives prominence to powerful people who up to this point might have operated in the background; people like Anne Simpson, director of global governance at CalPERS, California's public pension fund. As Time reports, with more than $350 billion in investments, CalPERS and Simpson have the wherewithal to strike fear in mining giants, coal producers and oil and gas majors. Creating even bigger headlines, Laurence D. Fink, founder and chief executive of BlackRock, the world's largest asset manager with nearly $7 trillion in investments, announced in his annual letter to CEOs (of companies in which BlackRock invests) that climate change is ushering in a “fundamental reshaping of finance” and significant re-allocation of capital in the near future. Powerful words from a powerful person.

But climate change advocates do have and will have opponents of their own. Canada’s otherwise progressive Prime Minister Justin Trudeau, for example, thought it wise to appoint a more “business oriented” Minister of Environment and Climate Change. The reason is that his climate change policies had resulted in a feeling of alienation in Western Canada. Not a single seat had been won by Trudeau’s party in the Western provinces of Alberta and Saskatchewan. Alberta’s Premier Jason Kenney meanwhile stated "the manifesto for that day of [climate] action was essentially to shut down the entire industrial economy, virtually overnight." More and sharper controversy is to be expected.

Geopolitical Tension

In his first speech as Prime Minister of the United Kingdom, Boris Johnson encouraged his fellow Britons to look at the opportunities rather than the risks created by the UK leaving the European Union. He urged them “to recover our natural and historic role as an enterprising, outward-looking and truly global Britain, generous in temper and engaged with the world.” A noble goal, to be sure. But Brexit was a divisive battle by any account. What is more, Brexit did not so much create divisions in British society but it crystallized existing ones, including those between metropolitan areas and the countryside, younger and older generations, and the beneficiaries of globalization and those left behind. And even once “Brexit gets done” it will take hard work to overcome entrenched differences.

On the broader global scene the ongoing dispute between the United States and China illustrates a world where the rules of engagement have become less forgiving. Even once agreements on the trade side are finally reached, commentators are convinced that these have more the character of a temporary ceasefire than true resolution. Much like Brexit has brought to the fore existing divisions, the Sino-American trade dispute is an expression of a larger and more fundamental confrontation that is unlikely to go away any time soon. As one commentator put it: The trade war is just the beginning. Josep Borrell, Foreign Affairs and Security Chief of the European Commission shares the assessment. He points to a need for stronger European assertiveness in the world, where there are “crises everywhere you look. “

An era of intense competition between and assertive behavior of global superpowers has ramifications for international relations at large. For middle powers it creates a real danger of getting “squeezed” and a host of challenges ranging from trade restrictions to national security. Government and businesses may also feel increasing pressure to “choose sides” making it much harder (especially for tech companies) to operate “globally.”

Such geopolitical tension puts a premium on the ability to influence strong-willed powerful people. Exercising such influence starts with a realistic assessment of what can be achieved followed by persistence and savvy. Canadian foreign minister, Chrystia Freeland - charged with negotiating the new NAFTA with the mighty Trump administration - has emerged as one person who evidently has what it takes. Not only did she get the (from the Canadian perspective) desperately needed trade agreement over the line, it earned her much respect with her counterparts and a larger subsequent role in the Trudeau cabinet. A profile on Freeland dubbed “the Negotiator” points to her equal tenacity, detail orientation and ability to inspire - important qualities in a world that is relentlessly shaped by people and events beyond one’s control.

A New Generation of Powerful People?

Reflecting back on IPP 1.0 we cannot help but acknowledge some enduring characters. Since publishing the first edition, some of the powerful people profiled have actually become more powerful - US President Donald Trump is the most striking example. And though her tenure is coming to an end, Angela Merkel was German Chancellor in 2011 and still is - an amazing 15 years in office.

But there are new faces as well. When Sanna Marin of Finland, age 34, became the youngest prime minister in the world she also led a coalition government of no less than five parties each headed by women under 40. And while the advancement of women in leadership is progressing too slowly for many - Fortune Magazine reports that a mere 6.6% of Fortune 500 CEOs are female - the 33 female F500 CEOs represent a larger number than ever. Thus it appears that we must get ready for more women in power and understand how, if at all, power dynamics are different in a more diverse world. Canadian prime minister Justin Trudeau, for example, was forced to defend his “feminist credentials” after expelling two high profile women MPs from his party who insisted they had acted “on principle.” One of them was the country’s first Indigenous justice minister and attorney general.

If there has been a changing of the guard it is perhaps most visible in the world of motor vehicles or “mobility,” to use a more fashionable term. Ferdinand Piëch, the towering chief of Volkswagen, grandson of auto legend Ferdinand Porsche and one of the most brilliant automotive engineers of all time, passed away in 2019. His was one of - if not the - biggest names in car making. Few would argue that this “title” now belongs to Elon Musk, the flamboyant and equally brilliant CEO of Tesla Motors. Like Piëch, Musk is said to be notoriously demanding, charming, and relentless in his pursuit. He is also no stranger to controversy.

In the harsher climate of the 2020s, therefore, it appears, that Jeffrey Pfeffer's insightful observation about power remains highly relevant: “The stomach for engaging in conflict” is a key source of power (and a characteristic of powerful people). Thus, when it comes to influencing powerful people, we remain up against a potent mix of brilliance, charm, and brute force, often coupled with a relentless drive to achieve a bold vision.

Welcome to the IPP 2.0; welcome to the 2020s!