Remembering Peter Schutz (1930-2017)

Unpacking from my recent move, I found some old notes from a dinner with Peter Schutz. Peter was the CEO of Porsche from 1980-1988. He helped me kick off one of my executive groups in 1996. Peter passed away in 2017, but he was a person you never forget.

At our dinner he talked about the difference between the democratic process and a dictatorship in a management team. As CEO of Porsche, Peter attended many of the automobile races where Porsche had an entry. Le Mans was his favorite. He loved to visit the pit area, but even as CEO, if he got in the way or his assistance was needed to grab a tire or a wrench, the orders were barked and by golly, he complied. He didn’t just comply. He enthusiastically grabbed the tire and delivered it port-side to the car, and just in time, because there weren’t any seconds to waste.

Was the action in the pit a democracy or a dictatorship?

5 thoughts on “Remembering Peter Schutz (1930-2017)

  1. don

    it was an inspiration to be part of the team
    his dictatorship came when he decided to make the best racing team, but it took a democracy
    to make it happen

  2. Michael Branning

    The Pit action was an example of dictatorial execution based on prior democratic decision making! Because you don’t have time during execution to re-align the team constantly, you spend more time up-front getting alignment, so you can act rapidly.

    I remember this example from his talk to my TEC group back in about 2005. The lesson stuck with me in a critical point in my business, where it proved crucial to our turnaround. His book “The Driving force” is a great read.

    BTW – you are one of the most memorable speakers of my 16 years in TEC/Vistage. Love the blog!

  3. James Rund

    Democracy leadership allows more participative leadership. The group respected those assigned to their area of responsibility in the pit. This included the CEO knowing who is in charge in the pit.. When the CEO abided by the direction of his pit crew by complying to the orders, he reinforced the empowerment given to his employees to make things happen without dictatorship. This also sets a positive climate by showing the value of his employees. As leaders. we need to know when to get out of the way to accomplish the mission.

  4. Henry Camp

    Like Michael, I heard Peter speak twice and met with him once in his home town, Naples. When he spoke of dictatorial vs. democratic, he meant that decisions should be arrived at democratically, to be sure that they are implementable. The product of percent that the direction is chosen democratically multiplied by the quality of the idea determines the value in reality. Then, once the decision is agreed upon, it should be implemented dictatorially.

    What happened in the pits at Le Mans is an example of the Theory of Constraints properly executed. The current constraint to doing better in the race was to minimize time in the pits. Peter’s following directions were simply subordinating to the decision about how to exploit the constraint.

    Both democratic and dictatorial approaches are push processes, different agencies demanding an action. This was pure pull, guided by institutional knowledge.

    BTW, I also agree with Michael that you were the best Vistage speaker in quite some years. Thank you for your book you gave me, Hiring Talent, I have modified my interview questions and my SOP for hiring.


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