Public vs Private Sector Leadership - Lessons from BER International

Author: Dirk Schlimm, Partner, Jenoir International | | Categories: Collaboration , Decision Making , Leadership , Teamwork , Trust

Blog by Jenoir International Inc

When it comes to national embarrassments, one would be hard pressed to do better than Berlin Brandenburg Airport (FBB), or known by its IATA airport code BER. The “new” international airport of Germany’s national capital opened, on the down-low so to speak, on November 1st, 2020. The quietness of the affair had good reason: BER started operations 9 years late and billions over budget; plans for the airport had actually begun as early as 1990, the year of German reunification making this a, no typo, 30-year airport building project.

The International Press Has a Field Day

There is a German saying that “he who is befallen by setbacks has no need to provide for mockery” and so it should come as no surprise that the BER saga created an entire cottage industry of mockery and sarcasm. The American New York Times reported how scoffers had suggested moving the city of Berlin to a functioning airport rather than building BER, the English Economist chronicles a “head spinning catalogue of errors,” and the French Le Monde opined that the time to revise the stereotype of German efficiency had come at last. The Chinese Global Times, otherwise known for its aggressive messaging in support of the Chinese Communist Party, graciously titled “End of a long wait” - but one can rest assured that the editors left it to the reader to discern the stark contrast to much shorter airport plan & build times in the Middle Kingdom.

And indeed, one might be tempted to heap on the schadenfreude over yet another big chinck in the armor of German engineering, the earlier one having been provided compliments of the emissions scandal brought on by the iconic Volkswagen brand.

In a Democracy, Mega-Projects Are a Massive Challenge  

It would, however, be short-sighted to leave things there. No doubt, BER was (and, given the pandemic induced problems for air travel everywhere, remains) a debacle. But the eventual opening on Nov. 1st teaches important lessons on the nature of leadership and the indispensable necessity of influencing skills. The reason, in one word, is democracy. In a democracy (especially one with different levels of national, state and municipal government) with independent zoning, construction, safety, and a host of other authorities, a thicket of environmental & sustainability laws, regulations, and best practices, stakeholders ranging from neighbors to a plethora of activists, both well meaning and radical (think Extinction Rebellion), and independent administrative and civil courts ready to stop a mega project in its tracks both on procedural and substantive grounds,  a project like BER is a massive undertaking. This is in addition to organizing and navigating a governance maze of public/private partnerships, tapping a diversity of funding sources, all before managing a raft of trades, contractors, material suppliers, and other providers with quality problems and finger pointing looming everywhere. Throw in technology glitches and data privacy regulations and you get the picture. This project truly is the project from H.E. double toothpicks.

How BER Did Get Done and by Whom Is the Bigger Story

The bigger story for BER therefore is how it eventually did get done, and by whom. Enter  Engelbert L. Daldrup or ELD. The FBB website lists ELD as its CEO under the full name Prof. Dr. Ing. Engelbert Lütke Daldrup (Germans put degree letters as a prefix rather than a suffix). It highlights his doctorate in urban planning, and a number of public sector positions, including city counselor responsible for urban development and construction in Leipzig, permanent state secretary at the Federal Ministry of Transport, Construction and Urban Development, and a stint as “freelancer.” What’s glaringly absent is any type of corporate private sector experience. What is more, ELD had only been brought on when BER was already in significant trouble and had replaced previous private sector high fliers (the paper Die Welt refers to one of them as a “top manager”) with impressive resumes yet having to capitulate against “the monster” as the airport project was known. Where they failed, ELD succeeded.

And so, there are important lessons to be learned:

1. Complex (i.e., complicated and constantly changing projects) do require a unique blend of subject matter expertise, dogged persistence, and skilful diplomacy as well as knowing when to deploy which.

2. The conventional wisdom, some may say dogma, that private sector executives, always and by definition, make better executive leaders, has been refuted. In fact, they often don’t especially when operating outside the world of business including the blurred world of public/private. Interestingly, ELD’s predecessor quipped that “I have never been much of a diplomat” - meaning of course that this was a virtue. 

3. Any significant work being done in the public eye subjects one to a legion of armchair experts and, especially when things go wrong, merciless mockery. To say that thick skin is required is an understatement. Those looking for constant adulation must not apply. 

The True Test of Leadership

Thus, when deciding the all-important question as to whom to put in charge, from running a company to overseeing a pandemic response, to organizing a vaccine rollout, those tasked with that decision would do well not to limit them themselves to successful private sector CEOs. Management thinker, Jim Collins, goes as far as suspecting that while social sector organizations increasingly look to business for leadership talent there often will be more effective leadership in the social sectors than in the corporate world. The reason is that the practice of leadership is not the same as exercising power. True leadership, Jim explains, only exists if people follow when they have the freedom no to. So, building an airport in an autocratic regime with no risk of opposition from citizens or activist interest groups and no concerns over independent supervisory authorities or courts takes a lot less in terms of leadership than building an airport in a liberal democracy with a myriad of stakeholders who cannot and will not be muzzled. In other words, leadership takes both power and influence - and more of the latter. 

Building BER is a seminal case study in managing complexity. Unlike mere complicatedness (=difficulty), complexity is characterized by both perplexing difficulty and sudden change. And so, it does take subject matter expertise, tenacious determination, and an ability to influence in order to succeed. Hence, when selecting the leader for an undertaking of far-reaching importance, the board or other principals charged with selection, must withstand the temptation to limit themselves and/or operate based on preconceived notions. Private sector, politics, academia, the military, and charitable organizations *all have capable people that integrate indispensable leadership and influencing qualities and the context may at times give the edge to the less obvious candidate.

This blog is designed to inform readers and stimulate discussion. It is shared with the understanding that it does not constitute legal, accounting, securities or other professional advice to be relied upon. If such advice is needed, the services of a competent professional person should be sought.

As we are critically thinking human beings, the views expressed in the blog are always subject to change, revision, and rethinking at any time. The author(s) and Jenoir® International are not to be held responsible for misuse, reuse, recycled and cited and/or uncited copies of content within this blog by others.