Joseph R. Biden Jr. will become the 46th
president of the United States at a time when the nation is grappling with several sober realities at once: a deadly pandemic that is claiming the lives of thousands of Americans daily, a bumpy vaccine rollout, a shaky economy with more than 10 million unemployed, and demands for police reform and racial justice.
But in the wake of one of the most tumultuous presidential elections in US history—marked by outgoing President Donald Trump claiming the election was stolen, deadly violence at the US Capitol, and Trump’s impeachment—perhaps Biden’s biggest challenge lies in attempting to heal a nation that is bitterly divided.
We asked members of Harvard Business School’s faculty two questions: First, how do you expect Biden’s presidency to impact businesses? And second, what leadership advice do you have for the new commander in chief? Here’s what they said:
Julie Battilana: Put people and the planet at economy’s core
My hope is that President Biden and his team will help all of us rebuild strong democratic foundations, and place human beings and the planet back at the core of our economic system. The COVID pandemic has propelled societies around the world into a multidimensional crisis. We are not only facing a health crisis, but economic and social crises, too, characterized by rising inequalities on top of an environmental crisis.
A common root of these multiple crises can be traced to neoliberalism, a doctrine that has focused all of our attention and energies on maximizing profit and financial value. This exclusive focus on profit and shareholder value maximization has led to environmental destruction and the concentration of wealth and power within the hands of a few. More specifically, this concentration of wealth and power has had two critical consequences. First, it has endangered democracy by giving the wealthy few enormous influence over who is elected to positions of power and what they decide. Second, it has further endangered democracies by fomenting resentment from those who are left out and by ushering to power populist leaders who made scapegoats of refugees, immigrants, and minorities.
“If we stay the course and fail to change, we will continue to further destroy the planet and further cement inequality.”
These tensions between neoliberalism and democracy cannot be ignored anymore. It is time that we tackle them. So, today we find ourselves at a crossroads. We can either “go back to normal” by relying on existing institutions and on the neoliberal economic model. Or we can dare to rethink and reform our economic and social systems in depth.
One thing is certain: If we stay the course and fail to change, we will continue to further destroy the planet and further cement inequality. This is why my hope is that President Biden and his team will implement a set of policies that will put human beings and the planet back at the core of our economic system. What is at stake is creating a more democratic, more just, and greener society, and this entails reforming our economic system and the way businesses operate.
Even though these changes that diverge from deeply rooted norms are challenging to implement, now is the time to push for them. As we know from history and as I have seen in my research, crises like the one that we are experiencing tend to facilitate the development and implementation of changes that break with the existing norms and power hierarchies.
We all have the opportunity to participate in the collective effort to create a more just, more democratic, and greener society. We missed this opportunity in the aftermath of the financial crisis, let’s hope that we will not miss this opportunity this time around.
Frances Frei: Ask us for a better version of ourselves
It’s hard to overstate the positive business impact of government that embraces optimism, stability, and competence. The Biden-Harris administration embodies all of these traits, both in who they are as leaders and in the policy agenda they’re likely to usher through a more functional Congress. I expect them to be stewards of a brighter future where more Americans get an honest shot at life, liberty, and the pursuit of happiness. Everybody wins in that scenario.
My advice to Biden: Continue to reveal your deep devotion to America and its core values, but also ask us for a better version of ourselves. It will be the privilege and burden of President Biden to make sure that the bar for what we can achieve together is high and rising.
Frances Frei is the UPS Foundation Professor of Service Management at HBS and is the author of Unleashed: The Unapologetic Leader’s Guide to Empowering Everyone Around You.
Joseph Fuller: Focus on doing what is possible
The most important impact Biden’s presidency is likely to have on business is a higher degree of stability and predictability. Many businesspeople thought elements of the Trump administration were favorable, such as a reduction in regulatory burdens and taking more aggressive steps toward foreign parties, especially China, who have consistently been behaving in ways that are damaging to US business interests. If you put aside feelings about partisanship and individuals, there were a number of things the Trump administration did that were supportive of business growth and economic growth.
But the volatility and dysfunctional relationship between trading partners and US institutions caused a lot of uncertainty. Specific companies or business sectors would suddenly find themselves the object of very aggressive, extreme criticism, not just by administration sources, but by the president publicly, which was unprecedented. Companies and sometimes entire sectors were subject to being called out. There was a randomness and arbitrariness to it that was disorienting. Similarly, companies with significant international operations would find themselves suddenly disrupted.
Companies were concerned about being caught in the crosshairs, and it caused them to question: What are the rules of the game? Companies like to know what the rules are and they like stability in those rules. I believe that businesses will welcome a higher level of certainty and predictability that I expect will come with the new administration.
“We should all acknowledge that the country today is almost literally a 50-50 proposition.”
In terms of leadership advice, first of all, we should all acknowledge that the country today is almost literally a 50-50 proposition. The Senate will be 50-50, and the Democratic majority in the House will be tiny. That is not the basis to pursue an outsized agenda for dramatic change, or for the introduction of policies that are very controversial. Passing programs like that requires some degree of consensus. One of the great challenges the president-elect will have is how to pursue his agenda while not contributing to a further period of sustained instability by implementing aggressive changes without a clearer mandate.
That should lead the Biden administration to consider areas like infrastructure spending, expanding domestic capacity in PPE and pharmaceuticals, steps to provide additional US intellectual property rights globally, changes to post-secondary education to support and expand areas like career and technical training, and encouraging expansion of research and development in the US. There are a lot of areas of common ground. And there are a lot of opportunities to do meaningful, important things that will benefit a lot of citizens. That’s a basis for collaboration and consensus, which is what one needs to focus on with a legislative branch that’s effectively tied.
One of the considerations for any leader is: What is possible versus what would I like to do? Good managers focus on doing what is possible. They think several steps ahead and consider how what they do will increase their odds of achieving their ultimate strategic goal in the future. And, they always respect the unknown. The world never unfolds in some scripted way, consistent with some “official future” on which plans were based. Any executive—business or political—should always marshal as much credibility and goodwill as possible in anticipation of having to deal with the unanticipated.
Regina Herzlinger: Confront the powerful divides in America
The Public Option health insurance proposed by the Biden campaign will weaken our economic status by adding to the national deficit and to Medicare’s unfunded liability. We should, of course, reduce the number of uninsured, and our Working Knowledge article explained how running the Public Option through private insurance firms can break even while increasing coverage of the uninsured.
In terms of his leadership, Joseph Biden’s soothing persona and vast legislative and administrative experience will calm those who objected to Donald Trump’s aggressive manner. But pleasant personality can go only so far. Joseph Biden must deliver a strong economy and effectively address the powerful divides among various American groups.
Regina E. Herzlinger (@REHerzlinger) is the Nancy R. McPherson Professor of Business Administration at HBS, with a research focus on health care.
First COVID, then confidence. With Joe Biden in the White House, the year 2021 is likely to be defined not just by recovery but by big leaps forward in the economy and the better world department.
First, the Biden presidency is likely to generate business benefits by leading effectively through and beyond the multiple pandemics facing America. President-elect Biden and Vice President-elect Harris are likely to ensure that strong public health measures are in place to mitigate the effects of the COVID-19 crisis, vaccines are widely distributed, and small businesses and ordinary workers get support to keep going. In the short term, an end to the worst of the pandemic will unleash pent-up demand.
Then the Biden administration will provide the certainty, consistency, and continuity business leaders crave (even when they might not like particular policies). This will give a big boost to business and consumer confidence. Under Biden and Harris, drama and uncertainty will be replaced by goal clarity and communication transparency. President-elect Biden’s Cabinet and advisor choices have signaled that the federal government will be led by experienced professionals who work collaboratively and can guide greater national efforts to ensure cooperation and consistency across states. Businesses will find it easier to make plans and invest for the longer-term.
Expect the Biden administration to also tackle long-standing problems that influence the ecosystem for business success: climate change, crumbling infrastructure, digital divides, health disparities, racial equity, public education, and firmer safety nets. There will undoubtedly be tightening of regulations that were loosened during the Trump years, which will be opposed by some business interests, but making progress on such issues will improve society, and there is a growing recognition that business is not distinct from society. Healthier, more financially secure workers are more productive on the job and are more avid consumers at home. Investments in education, starting with early childhood, expand the talent pool and reduce otherwise-costly social problems.
The nation will become both more global and more local. Biden will direct a return to global cooperation, a welcoming of immigrant talent, and US leadership on humanitarian and related issues. This should help big business seeking global markets.
At the same time, Biden’s proposals to “build back better—in America” and ensure investment in technology and innovation in all 50 states will provide a shot in the arm for SMEs and give larger companies a broader array of local supply chain partners. This should help small business and stimulate increased consumer spending on local services.
Innovation is a Biden theme, one of the pillars of his campaign, which he also applied to addressing racial disparities in technology, including infrastructure and the environment. Expect investment in these areas. The Biden-Harris team is rich with climate change experts, which means that companies with a green tech/clean tech focus can expect open doors in a Biden administration. And, in general, the administration will offer a very welcome reception for companies that demonstrate their commitment to values, especially racial justice, and are willing to contribute to solving problems of lower-income communities.
“Pluralism, the system that brings unity, rests on ensuring a little something for everyone.”
How much of their agenda President-elect Biden and Vice President-elect Harris can accomplish will depend on whether they can make headway in their quest to heal the national divide. They must deal with recalcitrance in Congress and public cynicism, along with outright opposition.
He can use his message and personal model to stress “we”—as in, “it’s not my Justice Department; it’s the people’s Justice Department.” A positive tone at the top can chip away at hardened partisanship by exemplifying inclusiveness and refusing to give in to anger and blame, which are unproductive emotions anyway. Pluralism, the system that brings unity, rests on ensuring a little something for everyone, even if no one gets exactly what he/she wants. Bringing the willingness to compromise and find common ground will be key to effective governance. And even if some top officials on the other side of the partisan divide refuse to play along at first, find the allies who will defect from divisiveness and elevate their stature, which will soften the opposition block.
Biden and Harris have a secret weapon in the quest for unity: the idealism of young people. Let the young lead. National service programs can be used to bring together diverse young people to accomplish tangible projects in local communities that support national goals. That will demonstrate unity and transformation in action. If unity seems a stretch too far, civility and amity would be a welcome start.
Rosabeth Moss Kanter (@RosabethKanter), who was a volunteer member of two Biden campaign policy committees, holds the Ernest L. Arbuckle Professorship at HBS, specializing in strategy, innovation, and leadership for change. She is the author of Think Outside the Building: How Advanced Leaders Can Change the World One Smart Innovation at a Time.
Karen Gordon Mills: Address hard problems for small businesses
In 2009, when I stepped into my role as administrator of the US Small Business Administration, we were in the midst of the Great Recession, and many of us believed it was the worst small business crisis we would ever witness.
Of course, we were wrong. The economic impacts of COVID-19 have proven even worse for many small businesses. But I am hopeful for 2021, because I believe the incoming Biden administration will tackle these unprecedented challenges with competence and dedication.
I had the great honor of visiting with many small businesses with then-Vice President Biden during my time in Washington. Based on that experience, I know he’ll keep small businesses front of mind in these difficult times. He truly understands that small businesses, beyond accounting for half of our country’s jobs, provide a real pathway to the American Dream. Addressing hard problems around access and opportunity in this space will be a key focus of his presidency, and small businesses are sure to have a seat at the policymaking table.
President-elect Biden has another important asset. Throughout his career, he has demonstrated that he is someone the public can trust, and that his mission has always been to improve Americans’ lives. It’s this kind of honest and purposeful leadership that we need to help guide our communities through the pandemic and move forward once it’s over.
Karen Gordon Mills (@KarenGMills) is a Senior Fellow at HBS and served in President Barack Obama’s Cabinet as the Administrator of the US Small Business Administration from 2009 to 2013. She is the author of Fintech, Small Business & The American Dream: How Technology is Transforming Lending and Shaping a New Era of Small Business Opportunity.
Mitchell Weiss: Organize an ‘ambidextrous presidency’ with VP
The new president will feel and be much compelled to shore up the core strengths of government. Our federal government must deliver with competence and strong coordination on all of its basic functions, especially these days. It also must find ways to be experimental and to explore new ways of working.
Mike Tushman and Charles O’Reilly have written of Janus, the Roman god who “had two sets of eyes – one pair focusing on what lay behind, the other on what lay ahead.” Striking this balance, Tushman and O’Reilly argued, requires “ambidextrous leadership” at the top of organizations.
Biden should tap his vice president as his second set of eyes, a pair that could make sure his administration is on the lookout for new ideas and that agencies are empowered and equipped to try them without wasting too much public treasure, time, and trust. Biden has indicated that Harris’s voice will be “the last in the room” when he is making crucial decisions. What could she ask as the last to be heard?
- “Have we solicited many ideas; did we enlist outsiders and, yes, citizens in suggesting some?”
- “Have we identified uncertainties in our plans and devised ways of quickly testing to try to resolve them?”
- “Have we designed architecture for scaling, ideally so that users make other users better off?”
Mitchell Weiss (@MitchWei) is a Professor of Management Practice, the Richard L. Menschel Faculty Fellow, and the author of We The Possibility: Harnessing Public Entrepreneurship to Solve our Most Urgent Problems
About the Author
Dina Gerdeman is a senior writer at Harvard Business School Working Knowledge.
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