Wednesday, August 08, 2012

Planning Does Not Work

The first priority in talking about the public policies and governmental measures needed in the entrepreneurial society is to define what will not work -  especially as the policies that will not work are so popular today.

“Planning” as the term is commonly  understood is actually incompatible with an entrepreneurial society and economy.  Innovation does indeed need to be purposeful and entrepreneurship has to be managed.  But innovation, almost by definition, has to be decentralized, ad hoc, autonomous, specific, and microeconomic.  It had better start small, tentative, flexible.  Indeed, the opportunities for innovation are found, on the whole, only way down and close to events.  They are not to be found in the massive aggregates with which the planner deals of necessity, but in the incongruity, in the difference between “the glass half full” and “the glass half empty,” in the weak link in a process.  By the time the deviation becomes “statistically significant” and thereby visible to the planner, it is too late.  Innovative opportunities do not come with the tempest but with the rustling of the breeze.

Peter Drucker, From Innovation and Entrepreneurship (1985)

Drucker was an amazing observer and as a result, amazingly prescient.  Brilliant.

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