Making Knowledge Workers More Productive   Insights From The Works Of Peter F. Drucker
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Making Knowledge Workers More Productive Insights From The Works Of Peter F. Drucker

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    Making Knowledge Workers More Productive   Insights From The Works Of Peter F. Drucker Making Knowledge Workers More Productive Insights From The Works Of Peter F. Drucker Document Transcript

    • Making Knowledge WorkersMore Productive: Insightsfrom the Works of Peter F.DruckerPEX Network Article Compilation
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 1|PageINTRODUCTION "Making knowledge workers productive requires changes in attitude, not only on the part of the individual knowledge worker, but on the part of the whole organization." – Peter F. DruckerCompanies have a vested interest in increasing the productivity of their workforce.Increased productivity means the ability to do more without increasing headcounts.But it means something more––much more. Knowledge workers put knowledge towork.Knowledge workers can be doctors, robotic repair people, sales managers,maintenance managers, quality specialists, market researchers, graphic artists andthe like. The list is virtually endless given the composition of todays knowledge-based workforce.Lets be clear here. Information is not knowledge. Only if information is put to workcan it become KNOWLEDGE. Perhaps Oscar Hammerstein said it best: “A Bell is not abell till you ring it, a song is not a song, till you sing it.”Information must be applied to specific work and performance for it to be classifiedas knowledge. It must be mentioned––indeed, emphasized––that only human beingswith their brains and/or the skill of their hands can convert information intoknowledge.Wealth creation results if knowledge workers do the right things and do them right.In other words, the right knowledge properly applied by human beings createswealth.Translated, this means that knowledge workers (which are completely different thanmanual workers) must be made more productive. Only by making knowledgeworkers more productive––as youll learn from the selected articles––can inflation becontrolled and wealth created for organizations and society.Peter F. Drucker taught us much about managing knowledge work. He provided uswith a framework for being able to think through thoughtfully and thoroughly whatmust be done and how to do it.In this PEX Network article compilation, colleagues, and students of Peter F. Drucker,share their thoughts on what the “master of management” thought about the keysto making knowledge workers more productive.A special thank you to Dr. Robert W. Swaim and Dr. William F. Cohen for theircontributions to this report. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 2|PageCONTENTSIntroduction ................................................................................................................................ 0A New Emphasis on Productivity Improvement ......................................................................... 4Getting Down to Busy-ness: Knowledge Workers Are Less Productive than Ever.................... 11Abandoning the Obsolete and Unproductive: A Difficult but Necessary Task.......................... 30The Secret to Achieving More with Less - The Pareto Principle in Action ................................ 34The Demotivation Trap and What You Can Do About It ........................................................... 425 Global “Certainties” You Can’t Afford to Ignore .................................................................... 52About the Authors .................................................................................................................... 56Learn more about Productivity Enhancement Through Lean Six Sigma & BPM ....................... 57 www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 3|Page “The most valuable assets of the 20th-century company were its production equipment. The mostvaluable asset of a 21st-century institution, whether business or non-business, will be its knowledge workers and their productivity.” - Peter F. Drucker www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 4|PageA NEW EMPHASIS ON PRODUCTIVITYIMPROVEMENTFrom the Editorial Staff at Process Excellence NetworkPublished 6 April 2009Productivity improvementwill be a major challengeand concern in the yearsjust ahead.Productivity, as weve allheard a good many times bynow, is the key to managingthe inflation many believewill occur because of thegovernments well-intended(but questionable) economic policies.To have price stability, wages must not rise faster than productivity. A simpleequation, formulated by C. Jackson Grayson Jr, former pricing commissioner/czarduring the Nixon administration, explains this quite well:[Wages — Productivity Increases = Price Increases]For example, if wages increase by 10 percent and productivity increases by 3 percent,then the price increase would be 7 percent.If wage increases gallop at a significantly faster rate than productivity, price inflationwill occur.We expect we will soon be hearing about gearing wages to productivity improvementguidelines. Unfortunately, many economists believe this never works.One scenario predicted by several leading economists claims that using governmentspending to stimulate consumption is a sure-fire recipe for inflation. It will lead to toomuch money chasing too few goods and services.Once the inflation starts—if, indeed it does—people will demand higher wages tokeep up with the increasing cost of living. If wages increase faster than productivityincreases, hyper-inflation is a possibility. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 5|PageThe only way our society will be able to maintain or enjoy a comfortable, let alonerising, standard of living is if managers in all enterprises solve the productivity puzzle.This is not an easy task.MANAGING PRODUCTIVITYMaking resources productive is the specific job of management, as distinct from theother jobs of the "manager”: administration and entrepreneurship.The world knows that Peter Drucker was the greatest management thinker of the lastcentury. His story is a story of management itself.According to Drucker, it is only managers—not nature or laws of economics orgovernments—that make resources productive.Resources can be made productive in the individual plant or enterprise, the individualstore, the individual hospital, the individual office, the individual research anddevelopment lab and the individual port.They are made productive—or deprived of productivity—by individual managerswithin their own individual spheres of responsibility.PRODUCTIVITY IMPROVEMENT THROUGH INNOVATIONThanks to Drucker we now know quite a bit about productivity improvement. Weknow that it is, in part, achieved by innovation—the shifting of resources from oldand declining employments to new and more productive ones.Organizations must be able to systematically identify emerging opportunities anddevelop the structures required to make the new and different happen.In his book Innovation and Entrepreneurship (Harper & Row,1985), Druckerdefinitively described what must be done and how to do it with respect to makinginnovation an acquired organizational skill.But—and this is a big but—organizations must be able to get rid of yesterdays tasksand free their energies and resources for new and more productive tasks.Abandonment is a prerequisite for innovation and change."If an organization wants to be able to work on opportunities, it must be able toabandon the unproductive and slough off the obsolete," Peter Drucker said. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 6|PageNo organization that purposely and systematically abandons the unproductive andobsolete ever wants for more productivity improvement opportunities. Ideas arealways around in profusion.The key, said Drucker, is to convert them into doing. Lack of creativity is, therefore,not the problem of todays organization. Rather it is organizational inertia whichalways pushes for continuing what we are already doing.Drucker left no doubt that existing organizations must know how to organize forinnovation. Otherwise the ongoing business will squash newness of more than atrivial dimension.Internal entrepreneurship will be a major trend in most organizations. It is mission-critical if organizations want to leverage productivity improvement opportunities. Butinternal entrepreneurship requires systematic, organized, purposeful management.Innovation within an existing organization is a device for moving scarce andexpensive resources from areas of low productivity and non-results to opportunitiesfor achievement and contribution.MAXIMIZING PRODUCTIVITY IMPROVEMENT THROUGHCONTINUOUS IMPROVEMENTIn addition to innovation, productivity is increased through the continuousimprovement of the productivity of resources in existing deployments. Six Sigmaadvocates speak prescriptively of kaizen, or continuous improvement.Trying routinely to get better one step at a time is a far better way to improve thanshooting constantly for the big payoff. Major leaps into sudden business success arevery rare.Sustained success is largely a matter of focusing on streamlining and re-engineeringexisting processes. Getting better and better one process at a time leads to greaterproductivity improvement over time.PRODUCTIVITY IMPROVEMENT VIA TECHNOLOGYTechnology can increase productivity if appropriately applied. Technology does notnecessarily mean spin-offs from "science and engineering."Techne, Peter Drucker reminded us, is the Greek word from which "technology”derives and means "useful knowledge," or "organized skill," rather than engineering. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 7|PageThe substitution of capital-intensive technology for labor-intense activities in manyinstances can help productivity improvement. But in certain areas such as healthcare, more capital-intensive equipment usually requires more skilled technologists tooperate the equipment.Translated, this means the substitution of capital for labor does not necessarilyincrease output or productivity and simultaneously lower costs.In many instances, it just increases the quality of the output with a correspondingincrease in costs.Using a broader definition of technology, that is, "useful skill," points to the directionof more job-focused training. New and better skills must be continually acquired bytodays labor force.Organizations will have to upgrade the skills of their employees and/or find moretalented employees to accommodate changing strategies. Organizations need peoplewho can work smarter.People will have to spend more time at their jobs away from their offices and labsattending conferences, seminars and short courses at universities and colleges.Further, they will have to spend more time when in the office taking webinars, virtualconferences and exchanging information with peers on social networks.Indeed, acquiring and successfully applying useful knowledge to productive work isprobably one of the best solutions for productivity improvement.MANAGING THE KNOWLEDGE WORKER FOR INCREASEDPRODUCTIVITYMaking the knowledge worker productive requires more than training andinformation acquisition. It requires knowing the factors that determine knowledgeworker productivity.What follows provides a more comprehensive viewpoint of how to manage andmaximize knowledge worker productivity.Peter Drucker listed six key factors that determine knowledge worker productivity.These are: 1. Knowledge worker productivity demands that we ask the question: “What is the task?” www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 8|Page 2. It demands that we impose responsibility for their productivity on the individual knowledge worker themselves. Knowledge workers have to manage themselves. They have to have autonomy. 3. Continuing innovation has to be part of the work, the task and the responsibility of knowledge workers. 4. Knowledge work requires continuous learning on the part of the knowledge worker, but equally continuous teaching on the part of the knowledge worker (to facilitate the sharing of best practices). 5. Productivity of the knowledge worker is not—at least not primarily—a matter of quantity of output. Quality is at least as important. 6. Finally, knowledge worker productivity requires that knowledge workers are both seen and treated as an "asset" rather than a "cost." It requires that knowledge workers want to work for the organization in preference to all other opportunities.Each of these are requirements that were noted by Drucker, except perhaps the lastone—is almost the exact opposite of what is needed to increase the productivity ofthe manual worker.In knowledge work quality is the essence of the output. For example, in appraisingthe performance of, say, surgeons in a given hospital, the question of how manypatients has he/she operated on is quite secondary to the question of how manytruly successful outcomes has she achieved?Knowledge worker productivity, Drucker repeated again and again, has to aim first atobtaining quality—and not minimum quality. Maximum quality.Only then, can one ask: "What is the volume, the quantity of work?"In essence, when managing the knowledge worker, a rigorous operational definitionof quality must be established. What results are expected?Finally, Drucker thought the most crucial question in knowledge worker productivityis the first one: “What is the task?”In manual work, the key question is always: "How should the work be done?" Inmanual work the task is always given.The first requirement in tackling knowledge worker productivity is to find out whatthe task is so to make it possible to concentrate the knowledge worker on the taskand to eliminate everything else. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 9|PageCONCLUSIONProductivity is the key to managing inflation. To have price stability, wages must notrise faster than productivity.Whether it is recognized or not, many practices for productivity improvement arederived largely from the thinking of Peter Drucker. His teachings form a blueprint forevery thinking manager.Read the original article here: A New Emphasis on Productivity Improvement www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 10 | P a g e"When a cynic asks, What if we train them and they leave? winning organizations respond: what if we dont train them and they stay?" - Peter F. Drucker www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 11 | P a g eGETTING DOWN TO BUSY-NESS:KNOWLEDGE WORKERS ARE LESSPRODUCTIVE THAN EVERContributor: Robert W. SwaimPublished 29 March 2011Knowledge is now the mainproduct of advanced economiesand the livelihood of the largestgroup of the population indeveloped countries. But how doyou measure and improve theproductivity of knowledgeworkers, asks columnist Dr.Robert Swaim, when you cannotreadily observe what they aredoing?Peter Drucker coined the term“knowledge workers” over fortyyears ago and wrote thefollowing in his book,Management Challenges for the 21st Century:“The most valuable assets of the 20th-century company were its productionequipment. The most valuable asset of a 21st-century institution, whether businessor non-business, will be its knowledge workers and their productivity.” Peter F.DruckerThis article addresses the following questions and Drucker’s views with respect toknowledge and manual workers:  What is the difference between “Manual Workers” and “Knowledge Workers”? www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 12 | P a g e  Why has the productivity of manual workers dramatically increased during the 20th century, while productivity of knowledge workers has decreased?  What are the characteristics of knowledge workers, their job needs, what motivates them, and how to lead, not manage them?  How do you increase the productivity of knowledge workers and why this is important?“Manual Workers” are those who essentially work with their hands, operatemachines, assemble parts, etc. and are generally involved in the manufacture of atangible product. The task of what they are to do is given, including the tools andequipment to use, with the focus on how to do it and to do things right, or efficiency.If manual workers leave the organization, the tools they used to perform their workgenerally remain behind with the organization. This may differ where certain tradesrequire the craftsman to furnish their own tools such as in home building, but rare inmost other cases such as an automobile manufacturing plant. In knowledge work the task of what to do is controlled by knowledge workers, theyown the means of production (knowledge not machines), they decide what methodsand steps to use, and they focus on what to do and to the right things oreffectiveness. When they leave an organization, they take the tools with them –knowledge.Drucker identified another group that is in between both the manual worker and theknowledge worker, the “Technologist.” This is someone who may work with theirhands but requires special knowledge, training, and skills to perform their work. Asan example, an X-Ray technician in the hospital, the dental assistant who cleans yourteeth, the Xerox service representative who repairs the copier and so forth.Drucker felt this group was becoming the largest of the three but did not really focuson them in his discussions of the knowledge worker. He did acknowledge thattechnologist have to be treated as knowledge workers and that although the manualwork of their job may comprise the majority of their time, the focus has to be onmaking the technologist knowledgeable, responsible, and productive as a knowledgeworker. In that regard, much of what is contained in this article would also apply tothe technologist, and I suggest, might also apply to most of today’s workforce otherthan perhaps the pure laborer digging a trench. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 13 | P a g eTHE PRODUCTIVITY ACHIEVEMENTS OF MANUALWORKERSIn the 20th century,organizations and managementexperts focused on increasingthe productivity of “ManualWorkers.” As a result, accordingto Drucker, there was a fifty-foldincrease in the productivity ofthe manual worker due to thecontribution of the earlyClassical School managementtheorist, Fredrick Taylor(Scientific Management) in the early 1900’s, and later in the century, by othercontributors, such as Edward Deming (statistical quality control and qualitymanagement). As recently as the 1960s, almost fifty percent of all workers inindustrialized countries were involved in making things or helping to make things.Today however, less than twelve to seventeen percent of the employees indeveloped countries are involved in manual work – making things with their hands. In1950, seventy three percent of employees in the United States worked in productionor manufacturing while now less than fifteen percent do. This decrease was notcreated by globalization and the exporting of jobs by multinational companies toChina and other low labor-cost countries as many in the U.S. Congress argue for thebenefit of their labor union constituencies who are few in number but vocal.It has largely been the direct result of the productivity gains in manual work asmentioned here.Also, farmers were the backbone of most economies a century ago – not only in thenumbers of people employed, but also in the value of what they produced. Now, indeveloped countries, few people are involved in farming work. As an example, in the1900’s, eighty five percent of the United States workforce was employed inagriculture. Now only three percent of the U.S. workforce is employed in agricultureand most likely are illegal Mexicans, while in the world’s second largest economy,approximately thirty one percent of the Chinese population is still involved in farmingtoday. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 14 | P a g eKNOWLEDGE WORK, KNOWLEDGE WORKERS ANDPRODUCTIVITYKnowledge work and theknowledge workerproduce a different typeof product, such as a newcomputer softwareprogram, a design for anew product, marketresearch studies as towhat opportunities theorganization shouldpursue, etc. Typically, theoutput of a knowledgeworker is someone else’s input and information for management decision-making.Knowledge workers are “specialists” in their own fields, and typically know moreabout their field than the managers they work for, which is why they are knowledgeworkers. This presents another challenge for the manager, how to manage someonewho knows more about the job than you do?In the 21st century organization and economy, there are now more knowledgeworkers than manual workers. Knowledge is now the main product of the advancedeconomy and the livelihood of the largest group of the population in developedcountries. Increasingly, knowledge is the key factor in a country’s internationaleconomic strength and managers need to understand how to lead and increase theproductivity of knowledge work.Alvin Toffler in his book Revolutionary Wealth (2006) discusses three waves ormovements. The first being the early transition from hunters to agriculture, thesecond from agriculture to industrialization, and now the third wave fromindustrialization to knowledge. Some developing nations such as China face thechallenge of transitioning in two waves at the same time, from agriculture toindustrial to absorb the over one hundred and fifty to two hundred million floatingunemployed migrant workers from the rural areas of China, and from industrial toknowledge as China attempts to keep pace with the developed world in technologicalachievements. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 15 | P a g eHOW CAN YOU MEASURE AND INCREASE THEPRODUCTIVITY OF KNOWLEDGE WORK?According to Drucker, “Wheremanual worker productivity hasdramatically increased, theproductivity of knowledgeworkers has been decreasing andthe problem has not beenaddressed.” The question is howto measure and improve theproductivity of knowledgeworkers when you really cannotobserve what they are doing, asin the case of manual workers?Are they looking out the windowat the birds, or are they creating a new product design? Drucker commented, “Interms of actual work on knowledge worker productivity we are, in the year 2000,roughly where we were in the year 1900, and a century ago, in terms of theproductivity of the manual worker.”REASONS FOR LOW KNOWLEDGE WORKER PRODUCTIVITYAs mentioned, Peter F. Drucker recognized this issue over 40 years ago. Some of thereasons he identified which contribute to decreasing knowledge worker productivityare as follows:  The tendency to confuse busyness (filling out paper, passing paper back and forth and attending meetings) with productivity  Knowledge work cannot be replaced by capital investment as in the case of manual work  Capital investment creates the need for more knowledge work and creates a demand for new and more highly paid employees  Few know how to deal with managing the knowledge worker and increasing their productivity. In fact, Drucker suggests that, “Knowledge workers need to be led, not managed.” www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 16 | P a g eA recent survey of 10,000 knowledge workers in the United States revealed they feelthey are less productive today compared to a decade ago and that they waste overtwo hours a day excluding lunch. Interesting, many attributed this to technology,namely the Internet and time consumed reading and responding to emails each dayalthough some also played games. Another major reason cited by the respondentswas not having enough work to do or they felt they were underpaid for the workthey did do. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 17 | P a g eUNDERSTANDING THE KNOWLEDGE WORKERTo improve knowledge workerproductivity, according to Drucker, itis necessary to understand thecharacteristics of knowledgeworkers, their job needs, and whatmotivates them. These are presentedas follows:CHARACTERISTICS OF THEKNOWLEDGE WORKERHOW DO THEY LIKE TO WORK?  Knowledge workers have their own routines and patterns of work and therefore, they may not necessarily conform to 9 AM to 5 PM office hours.  They consider the productivity of their work to be the quality, not quantity, of their output of their work.  They are highly mobile and can move to a new company if learning and personal growth opportunities do not exist, or if they are underutilized in their present positions. As such, they are more committed to their professions rather than to the organization where they are employed.  They will work with associates in a team depending on the assignment but often prefer to work alone.  They must respect who they work for.  They need feedback but do not accept criticism of their work well.  The physical space where they work does not need to be too large but it should also not be a “black hole.”  They have a “mental space” and do not appreciate people intruding on it.  Their performance and energy levels operate in cycles – they are not machines that can be turned on and off easily. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 18 | P a g eWHAT KIND OF WORK DO THEY WANT AND HOW TO PERFORM IT?  Knowledge workers need challenging work – opportunities to pursue and problems to solve. Continuous innovation must be built into the job.  Their authorities and responsibilities need to be clear – what decisions can they make?  Knowledge workers need to take responsibility for the job and need productive work.  They are self-directed, but need leadership and support from their manager.  Continuous learning in their field of specialty and profession is extremely important.  Knowledge workers need feedback information in order to measure their own performance against standards and objectives.WHAT MOTIVATES THEM TO PERFORM?  Knowledge workers are not motivated by fear, but are motivated by achievement – they want to see the results of their work.  They are self-motivated – given a positive organizational environment.  The value support – they want others to think that what they’re working on is important.  Money and promotional opportunities are low on their list of motivation factors – typically they are well paid and enjoy what they do. Their chief reward is in their job and the work itself – if it is meaningful and makes a contribution to the organization.As can be seen, the characteristics, job needs and what motivates knowledgeworkers are considerably different than that of manual workers. In relation topopular motivational and leadership theories, knowledge workers can be consideredto be at the highest level of motivational needs.As an example, they are at the highest level of Abraham Maslow’s “Hierarchy ofNeeds Theory” in that they are motivated by “Self Actualization and Learning andUnderstanding Needs” rather than the lower level “Security and Safety Needs.” Withrespect to Frederick Hertzberg’s “Hygiene and Motivation Theory,” they aremotivated by the need for “Achievement and the Quality of Their Work” rather thanother “Hygiene Factors,” such as compensation and benefits and working conditions. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 19 | P a g eAnd in terms of David McClelland’s “Needs Theory” they are motivated by the “Needfor Achievement,” rather than the needs for “Power” or “Affiliation.”It is not practical to expand on all of the motivational theories sited here. For thosenot familiar with these and other motivational theories, I suggest a reference textwritten by Steven P. Robbins, Organizational Behavior. As previously noted in anearlier article, Drucker took a relatively dim view of the various leadership andmotivational theories that emanated from the Behavioral School although he didhave is own views on these topics that were covered in that article such as it is easierto de-motivate than motivate people including knowledge workers. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 20 | P a g eGUIDELINES FOR IMPROVING THE PRODUCTIVITYAND EFFECTIVENESS OF KNOWLEDGE WORKERSAccording to Drucker, increasingthe productivity of the knowledgeworker requires addressing anumber of key factors and askingsome important questions. Thesehave been incorporated into achecklist for easier referencecompared to searching for the keypoints on knowledge workers inDrucker’s books that are mainlynarratives. It should also be interesting to ask yourself as you review the checklist, dothese factors apply only to knowledge workers or everyone who works for me(manual workers, technologists, managers who report to me, etc.)?There are Eight Major Factors and key questions associated with each factor toconsider that are outlined below. Also building on the checklist, each factor will beaddressed in detail.DEFINING THE “TASK” OR THE “RESULTS”According to Drucker, “The first requirement in tackling knowledge work is to findout what is the task is so to make it possible to concentrate knowledge workers onthe task and eliminate everything else – at least as far as it can possibly bedetermined.”This initially can create some confusion in terms of attempting to differentiatebetween the knowledge worker’s “job” (Market Research Analyst), the “tasks” thatthe knowledge worker performs (conducts market research surveys, designs surveyquestionnaires, conducts focused interviews, etc. and the desired “results” (deliversa market research report on a particular market segment in China).It was also felt that Drucker deviated here from his holding people accountable andresponsible for “results” by now focusing on how these results are to be achieved –the “task.” To maintain consistency, we should focus on the “desired results” theknowledge worker is expected to produce – not the tasks. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 21 | P a g eTHE EIGHT KEY FACTORS IN KNOWLEDGE WORKERPERFORMANCE 1. Define Results: What results is the knowledge worker to produce? 2. The Job Assignment: What is the job the knowledge worker is to be assigned to or in now? 3. Task and Time Assessment: What are the tasks the knowledge worker is to perform and over what period of time? When do we expect the results? 4. Agreement on Objectives and Their Measurement: What objectives will be mutually agreed to and how will they be measured? 5. Providing Support: What support does the knowledge worker require to produce the results (budget, information, your coordination to involve others, etc.)? 6. Feedback and Self-Feedback Systems: How will the knowledge worker be able to measure his or her progress (self-control)? 7. Recognition: How do you plan to recognize the knowledge worker for producing the desired results (financial and non-financial rewards)? 8. Continuous Learning: What continuous learning and self-development experience will be made available to the knowledge worker (courses, seminars, professional conferences, and associations, etc.)?The following is a more detailed discussion of each of these eight factors and keyquestions to ask relative to the factor.FACTOR #1: DEFINING RESULTSDrucker stressed that the starting point in managing knowledge workers and theirproductivity is a definition of “results.” What is the final product the knowledge www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 22 | P a g eworker is to produce? Drucker also outlined “Four Dimensions” with respect todefining results that include; The Quality and Quantity Dimension, The TimeDimension, The Resource Dimension, and The Restrictions and LimitationsDimension. These Dimensions are summarized in the following checklists for easyreference.THE QUALITY AND QUANTITY DIMENSION  What should the quality and quantity of the results be?  How will quality and quantity be measured (agreed upon standards)?THE TIME DIMENSION  When should these results be delivered?  Is when the results are expected to be delivered flexible enough to allow the knowledge worker time to perform?THE RESOURCE DIMENSION  What financial resources are needed to produce the results (budget)?  What special knowledge and skills will be needed by the knowledge worker to produce the desired results?  What additional resources may be required (clerical support, research assistants, other knowledge workers, etc.)THE RESTRICTIONS AND LIMITATIONS DIMENSION  What restrictions and limitations exist that must be considered (limited budget, hiring freeze, other restrictions, etc.)?FACTOR #2: THE JOB ASSIGNMENTAccording to Drucker, “Assignment control is the key to knowledge workerproductivity.” Here again, Drucker suggests there are “Three Dimensions” to the JobAssignment; The Selection Dimension, The Autonomy and Responsibility Dimension,and The Knowledge Worker Reflection and Work Plan. A checklist is provided againfor easy reference. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 23 | P a g eTHE SELECTION DECISION DIMENSION  Who has the best strengths for this assignment (knowledge, skills, qualifications, and experience) to produce the desired results?  Can an individual complete the assignment or will it require a team of knowledge workers? If a team, who should be included and who should be the team leader?  Is this assignment the best one for this knowledge worker(s) that will produce the desired results?  Is this the best use of the knowledge worker?  Is this the best assignment for this person? Does it utilize his or her strengths?  Will this assignment present a challenge for the knowledge worker?  Is this assignment an opportunity to pursue or a problem to solve? If a problem, how long will the knowledge worker be dedicated to solving it?THE AUTONOMY AND RESPONSIBILITY DIMENSION  Will the knowledge worker be provided the autonomy to complete the assignment or is there a tendency of the manager to want to over or micromanage the project?  Will the knowledge worker be able to make decisions relative to his or her work? What decisions will require additional approval?  What will the knowledge worker be responsible for – and not responsible for?  What responsibilities will the manager of the knowledge worker retain?KNOWLEDGE WORKER REFLECTION & WORK PLAN DIMENSION  How will the assignment be performed to produce the desired results?  Has the knowledge worker been provided time for reflection on what work needs to be done and how to produce the desired results?  What are the tasks that need to be completed? Who should perform these tasks and in what order? Will some tasks of other knowledge workers or www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 24 | P a g e support people be input for other tasks? (See Knowledge Worker’s Preliminary Work Plan for an example.)  How will progress be measured (objectives, milestones, and feedback and self-feedback systems)?FACTOR #3: TASK ANALYSIS AND TIME ASSESSMENT In assessing the Tasks to be completed and the Time to complete them in, severalkey questions needed to be asked by both the manager and the knowledge workerwho has been assigned to produce the results. This could also be considered part ofthe knowledge worker’s reflection prior to starting the project. The key questions toanswer are also included in the checklists.TASK ANALYSIS CHECKLISTSTHE “WHAT?”Check the need and use of the job considered.  What is being done?  What is the purpose?  Is it essential? Would the sky fall down on us if we stopped doing it?  What keeps you from doing your tasks and should be eliminated?THE “WHERE?”In order to check if the place where we are doing something is the most appropriateone.  Where is the job performed? Why?  Could it be performed somewhere else, in a more economical and satisfactory manner? Outsourced?THE “WHEN?”In order to make sure that the job is being carried out at the most appropriate time.  When is the job being carried out? Why?  Is this the best time to do it? www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 25 | P a g e  Could it be done in another sequence?  What is the current status toward achieving the knowledge worker’s present objectives?THE “WHO?”In order to make sure that the person who performs the job is the most appropriateone.  Who does this job? Why? Who could or must do it? Why?  Could a more qualified person do it more economically?  Could a less qualified person do it after being trained?  Could the tasks be outsourced?THE “HOW?”In order to find out whether the job can be simplified or better performed, with lesscomplication, higher quality, and lower cost.  How is the job done? Why?  Could it be done in an easier and simper way?  Can it be done with higher quality, without introducing complications?  Are the means used the most appropriate?  Are there alternative means or other ways of doing the job that are better than the present ones?  Which things make the job complicated or difficult for the people who perform it? Could some things be eliminated?As can be seen, there are number of important questions that need to be addressedin this area alone if the productivity of knowledge workers is to be improved. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 26 | P a g eFACTOR #4: OBJECTIVES AND THEIR MEASUREMENTDIMENSIONThis Dimension is classic Drucker and directly from his book Managing for Results(1964) and later adopted in the Classical School as Management by Objectives(MBO). Since the practice of MBO is now over forty years old this checklist isrelatively brief:MBO as Applied to the Knowledge Worker  Knowledge and Objectives - Knowledge workers require that demands be made on them by knowledge – rather than bosses and by objectives – not people.  Mutually Established - The knowledge worker’s objectives should be mutually established between the management and the knowledge worker and directly relate to the results to be produced and the tasks to be completed to produce the desired results.  Milestones – Establish milestones for each task and objective. The manager should not over manage, but needs information as to progress in achieving the desired results.  Reporting - The times the knowledge worker will report results or progress need to be determined.FACTOR #5: PROVIDING SUPPORTThis factor includes a number of “Key Questions to Ask” in terms of providing supportto the knowledge worker.PROVIDING SUPPORT – KEY QUESTIONS  Support Required - What can management do to help the knowledge worker do his or her job? Ask when discussing the “Knowledge Worker’s Preliminary Work Plan” and provide the support that is required.  Obstacles - What hinders the knowledge worker from doing the job? Ask and remove it.  Others – Who else needs to know about this assignment? Do they have to provide input to the knowledge worker to complete a task? Are they cooperative or acting in their own self interests and not as a team? www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 27 | P a g eFACTOR #6: FEEDBACK & SELF FEEDBACKOnce again, the literature on providing feedback to people for their performance tosustain or improve performance is extensive. Thousands of books have been writtenon performance appraisal and so another tree will be spared here. Drucker did stress,although not entirely unique, that the best feedback for knowledge workers is self-feedback.In essence then, the knowledge worker should be able to refer to his or her WorkPlan and the tasks and milestones and be able to gauge where he or she is in thepath to producing the desired results. This also relates to one of the characteristics ofthe knowledge worker in that they do not accept criticism well.This is not to say that the manager avoids contact with the knowledge worker, orworse yet, adopts a Management by Exception (MBE) approach, one of the worstconcepts ever developed in management theory. This is the old, “You have completefreedom to do what is necessary to get the job done – just don’t screw up and thenyou will hear from me.” In the MBE approach, the only time the knowledge workersees his or her manager is when he or she makes a mistake and as such dreads seeingthe manager. It does not take long for the relationship between the manager andknowledge worker to deteriorate. During the progress review, the manager shouldprovide both positive and constructive feedback to the knowledge worker but caremust be taken in how the constructive feedback is presented.FACTOR #7: RECOGNITIONAnother factor in Drucker’s approach to improving knowledge worker productivity isto provide recognition for producing the desired results, once again a concept notunique to Drucker. Recognition could be in the form of both financial and non-financial rewards. Since the knowledge worker wants to stay abreast ofdevelopments in his or her own field, allowing them to attend industry conferencesand professional organizations on company time versus their own time is aninexpensive form of recognition. If the manager is unsure as to what non-financialrewards would be appealing to the knowledge worker, simply ask them. Recognitioncan also be provided by providing the knowledge worker with opportunities for self-development as covered in Drucker’s last factor.FACTOR #8: CONTINUOUS LEARNINGThe following are several of Drucker’s guidelines in dealing with the knowledgeworker’s self development and the need for continuous learning, one of the jobneeds of knowledge workers previously discussed. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 28 | P a g e  The knowledge worker should ask – what do I need to learn to keep up with the knowledge and know the things I am paid to know?  Knowledge workers should request their own training and development needs.  Training and development should be focused on people’s strengths, rather than on their weaknesses and limitations.  The objective is to do better the things that one already does well.  Everyone (knowledge workers) should be encouraged to teach and share their knowledge with others in the organization.  The knowledge worker should also ask, what do others need to know and understand about my area and what it can contribute to their own work?  Finally, the knowledge worker should ask what does my manager need to know about my knowledge in order to understand the opportunities, issues, and problems we need to deal with?SUMMARYThe productivity of knowledge workers has not kept pace with the productivity ofmanual workers and in fact, has been decreasing. Management must know how toaddress this problem, since the number of knowledge workers as compared tomanual workers in organizations, is increasing and will continue to do so.A number of application tools that can be used in dealing with knowledge workers inyour organization that should prove useful in applying a number of the concepts thatwere presented here can be obtained from the author, Dr. Robert Swaim, directly bycontacting him on docswaim@gmail.com.Click here to read the original article: Getting Down to Busy-ness: Knowledge WorkersAre Less Productive than Ever www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 29 | P a g e “There is nothing quite so useless, as doing withgreat efficiency, something that should not be done at all.” ― Peter F. Drucker www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 30 | P a g eABANDONING THE OBSOLETE ANDUNPRODUCTIVE: A DIFFICULT BUTNECESSARY TASKA fruit tree growsstronger and fuller whenit is pruned periodically.In a long-out-of-printbook entitled TheFolklore of Management,Clarence B. Randall, aretired president ofInland Steel, expressedthis thought mostelegantly:"The world around, hearty men who make a living by harvesting the fruits of the soilknow when and how to use the pruning knife. They have no more useful workingtool...whether it be a French peasant who gives daily, almost hourly, care to hisprecious two hectares of sun drenched hillside soil in Burgundy, or the cherry growerof Michigan or the owner of an apple orchard in the Virginia, he preserves the qualityof his product by his skill in removing deadwood...... the significant thing about his operation, however, is that he works at it all thetime...Never does he rush out in terror to lay about him with an ax, slashingindiscriminately right and left...he is steady and consistent about the whole processand keeps constantly at it…in the spring following a bumper crop, when he is sure hehas a vintage product, he does the same amount of trimming as after one of thosesad years when the hail damage has all but ruined him..."THE MESSAGE IS CLEAREvery enterprise, business or non-business, must constantly abandon the obsoleteand the unproductive. Every organization is likely to be loaded down with yesterdayspromises. These include activities and programs that no longer contribute; theventures that looked so enticing when started, but now, five years later, are stillunproductive. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 31 | P a g eThe best therapy for any organization from the point of view of performance is topurge itself of mediocrities. Systematic sloughing off of yesterday frees energies andresources. It makes available the people and funds required for new things.WHY PETER DRUCKERS IDEAS STILL MATTERThe late Peter Drucker identified the key management challenge of the 21st centuryas leading change and believed that the first question to ask is: “What should weabandon?" He realized abandoning yesterday is excruciatingly difficult.Modern organizations must be capable of change. Indeed, they must be able toinitiate change, that is, innovation. It is essential to move scarce and expensiveresources from areas of low productivity and non-results to areas where there areopportunities for achievement and contribution.Drucker observed:"Maintaining yesterday is difficult and time-consuming and therefore alwayscommits the institutions scarcest and most valuable resources—and above all, itsablest people—to non-results...organizational inertia always push for continuingwhat we are already doing......organizations are always in danger of being overwhelmed by yesterdays tasks andbeing rendered sterile by them... An organization - whatever its objectives - musttherefore be able to get rid of yesterdays tasks and thus free its energies andresources for new and more productive tasks."CONTINUITY VS. CHANGEDruckers central theme involved the never-ending battle of continuity vs. change. Herepeated over and over again that an organizations most able people tend to becommitted to yesterdays tasks, which means they are not available to createtomorrow. Every strategic plan stresses what should be done. But Drucker reasonedthat the initial emphasis of a strategic plan must focus on what to stop doing.Weeding out the nonproductive activity garden is as important in "running HR like abusiness" as is in the example given by Randall. One sobering method of avoidingputting too much effort into the soil bed of yesterdays activities and programs is toraise the Drucker question, "If we were not presently doing this or that activity wouldwe risk going into it today?" www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 32 | P a g eShortly after Jack Welch became CEO of General Electric in 1981, Business Weekmagazine reported, “He sat down with Drucker at the companys New Yorkheadquarters... Drucker posed two questions that arguably changed the course ofWelchs tenure: If you werent already in a business, would you enter it today?’ heasked. And if the answer is no, what are you going to do about it?"Those questions led Welch to a slew of abandonment decisions and to realize that"maintaining what no longer works draws your most valuable resources away fromyour number one job, creating tomorrow." Welch reinvented General Electric and iscredited with allocating resources on the right results. And in the process, Welchmade General Electric into one of Americas most successful organizations.WHY IS ABANDONMENT SO DIFFICULT?Without doubt, abandoning yesterday is painfully difficult but necessary. Yesterday iscomfortable. By contrast, the new and different always produce new problems.Custodial managers nurture yesterday far too long.In short, it boils down to familiarity with and sentimentality for what already exists.Organizations that are incapable of abandoning old and tired programs and activitiesare unlikely to make the new happen. Just asking the question, "What should weabandon or de-emphasize?" will force thinking and actions that can significantlyimprove operations and productivity. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 33 | P a g e"Successful enterprises create the conditions to allow their employees to do their best work." -Peter F. Drucker www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 34 | P a g eTHE SECRET TO ACHIEVING MORE WITHLESS - THE PARETO PRINCIPLE IN ACTIONFrom the Editorial Staff at Process Excellence NetworkPublished 19 September 2011Improving productivityrequires abandoning thingsthat do not work, neverworked, or have outlivedtheir usefulness and capacityto contribute. As bothgovernments and businesseslook out at a tough newoperating environment thatdoesnt look set to changeanytime soon, heres howPareto analysis can help.INTRODUCTIONPeter F. Drucker rendered explicit the interrelationship between and among threedistinct concepts—namely, abandonment, concentration and Paretos Law (a.k.a. the80/20 Principle).Abandonment and concentration, Drucker reminded us, are opposite sides of thesame coin. Simply put, abandoning unproductive and obsolete activities frees upresources to concentrate on result areas.However, deciding what to abandon is never easy. We all need a framework ormethodology to help us decide what to stop doing... and to pinpoint areas we shouldconcentrate efforts and resources.Pareto analysis is one of many tools used to identify activities, programs, productsand services that should be considered candidates for abandonment/de-emphasis. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 35 | P a g ePARETOS PRINCIPLEOne of the best books ever written about the Pareto Principle is Richard Kochs The80/20 Principle. It details how systematic and predictable lack of balance appears indata relating to a wide range of activities in both life and management activities.Heres an excerpt from Kochs book:"The pattern underlying the 80/20 Principle was discovered in 1897 by the Italianeconomist Vilfredo Pareto (1848- 1923). His discovery has since been called manynames, including the Pareto Principle... the Pareto Law... the 80/20 Rule... thePrinciple of Least Effort... and the Principle of Imbalance."So what did Pareto discover? He happened to be looking at patterns of wealth andincome in 19th-century England. He found that most income and wealth went to aminority of the people in his samples."Koch explains that, in essence, Pareto found that 20 percent of the populationenjoyed 80 percent of the wealth in all the countries studied. Indeed, thats whatreally excited Pareto.This pattern of imbalance was repeated consistently whenever he looked at datareferring to different time periods or different countries.It took many years for others to discover that Paretos finding could be extended allkinds of resources. In most situations, a pattern of imbalance with respect to effortsand results is a near-certainty."In 1949, George K. Zipk, a professor at Harvard, discovered the ‘Principle of LeastEffort,’ which was actually a rediscovery and elaboration of Paretos principle..."Ever so slightly paraphrasing Kochs summary of Zipks principle:Resources (people, products, time, knowledge, physical assets or anything else thatcan be made more productive) tends to arrange themselves so that approximately20- 30 percent of any resource accounts for 70-80 percent of the activity related tothat resource.What does this really mean? More results can be squeezed out of existing resources.Its a good bet that an organizations resources are not as productive as they couldbe. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 36 | P a g eAN EXAMPLEDrucker provided an excellent example of how nurses in a major hospital were askeda few questions in an employee survey:  What is your task?  What should it be?  What should you be expected to contribute?  What hampers you in doing your task, and should these obstacles be eliminated?According to Drucker:“The nurses were sharply divided as to what their task was, with one group saying‘patient care’ and another saying ‘satisfying physicians.’ However, they were incomplete agreement on the things that made them unproductive.“They called them ‘chores:’ paperwork, arranging flowers, answering the phone callsof patients relatives, answering the patient bells and so on.“All—nearly all—of these could be turned over to a non-nurse floor clerk, [who are]paid a fraction of a nurse’s pay.“When the nurses were freed of chores, their productivity nearly doubled, asmeasured by the time at the patients’ bedsides.“Further, patient satisfaction more than doubled and turnover of nurses (which hadbeen catastrophically high) almost disappeared, all within four months."The point? Resources have a tendency to decline in productivity. But, as Drucker soclearly illustrates, the way to get more output from existing resources is to make theresource "work smarter."Making resources productive is the specific job of management. In this case, aworkplace survey revealed that a large percentage of the nurses time was spent innon- nursing activities.That percentage had to be favorably altered—a greater percentage of nursing timehad to be directed towards the results desired. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 37 | P a g eZipks principle is valid. This means we have to constantly improve the productivity ofresources in existing employments. "We know that we need to work on theproductivity of each of the factors of production: capital, natural resources, time andknowledge."Why? Because its near-certain that the efforts-to-results ratio with respect to mostresources is predictably unbalanced.JURANS CONTRIBUTIONThe other pioneer of the 80/20 Principle was the quality guru Joseph M. Juran.Indeed, he coined the phrases "Pareto Principle" and the "Rule of the Vital Few."According to Juran, in any relevant data set a small number of elements will beresponsible for the preponderant portion of results. In terms of results the vital fewwithin the configuration or data set will always take precedence over the trivialmany.For example, if we assume there are five frequently cited reasons for customercomplaints, one reason (20 percent of the reasons) probably accounts for 80 percentof the complaints. Efforts should be concentrated on the one reason causing themajority of complaints.Still another example: While a manufacturer makes 20 different products, five ofthose products account for 75 percent of its customers complaints.And still another example: While there may be 12 distinct steps in the process oftransferring a patient out of an intensive care unit into a standard bed, two of thosesteps account for 82 percent of the total time in the total process.LESSON LEARNED SO FAR?Always look for the predictable imbalance. Breakdown the numbers. Disaggregatethe data.Expect the unexpected. Expect 20 percent to lead 80 percent... and 80 percent tolead to 20 percent. Always look for the powerful vital few. Its bound to be there.This will enable you to spot the important things. Accept the reality that with respectto causes, inputs and efforts the majority have little impact. But, rather, a smallminority of causes, inputs and efforts will have the major, dominant impact. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 38 | P a g eDRUCKERS SUMMARY OF THE PARETO PRINCIPLEDrucker repeatedly demonstrated how the application of Paretos Law could be usedin diagnosing patterns of potential misallocation of resources."Business enterprise is not a phenomenon of nature but one of society. In a socialsituation, however, events are not distributed according to a ‘normal distribution’ ofa natural universe..."In a social situation a very small number of events at one extreme—the first 10percent to 20 percent at most—account for 90 percent of all results; whereas thegreat majority of the events accounts for 10 percent or so of the results.“This is true in the marketplace: A handful of large customers out of many thousandsproduce the bulk of orders; a handful of products out of hundreds of items in the lineproduce the bulk of the volume; and so on.“It is true of sales efforts: A few sales people out of several hundred always producetwo-thirds of all new business. It is true in the plant: A handful of production runsaccount for most of the tonnage.“It is true in research: The same few people in the laboratory are apt to producenearly all the important innovations.“It holds true for practically all personnel problems: The bulk of grievances alwayscomes from one group of employees (for example, from the older, married womenor from the clean-up people on the night shift), as does the great bulk ofabsenteeism, of turnover, of suggestions under a suggestion system and accidents..." www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 39 | P a g ePREDICTABLE IMBALANCES HAVE IMPORTANTIMPLICATIONSIn short, Drucker, Zipk, Juranobserved that aggregatedata misinform, misdirect,mislead. Its a near-certaintythat theres an imbalancepresent between efforts andresults.Every manager, to beeffective, must assume animbalance exists withrespect to resource allocation. And must work hard to incrementally change theratio.The relationship between efforts and results are generally in a state of imbalance.The imbalance may be 65/35, 70/30, 75/25, 80/20 or 99/1, or any set of numbers inbetween.The key is to alter the ratio between effort and results. For example, if a managercould change the percentage proportion from 90-10 to 60-40, 70-30 or even 80-20,misallocation could be reduced and results improved.To be specific, if 10 percent of the sales force is contributing 90 percent of the resultsand the other 90 percent of the sales force is producing most of the cost, then theelimination of marginal performers and improvement of the mediocre performersshould be a priority commitment.Eliminating non-productive efforts, that is, abandonment will enhance performanceand make resources more productive.TO SUMMARIZEImproving productivity requires abandoning things that do not work, never worked,or have outlived their usefulness and capacity to contribute. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 40 | P a g eIt also requires concentrating on the things that do work—the things that produceresults—or the things that improve the organizations ability to perform.Economic results, Drucker reminded us, require efforts be concentrated on the fewactivities that are capable of producing significant business results.In making a distinction between the vital few and the trivial many, management canimprove its asset management by making its capital work more effectively. The morethe Pareto Principle is explored, the greater the relevance to improving theproductivity of all resources.Drucker frequently mentioned—indeed, emphasized—that:"In every industry there are institutions that operate at an essentially higherproductivity level than the average... What makes one company stand out and lead inany one industry is that it operates at about twice the average productivity of itsindustry..."Most of todays managers have grown up in a period of rapid economic growth.Productivities have become endangered because they have been neglected.In many organizations, to reverse the trend in productivities is a major managerialtask. It requires abandonment of obsolete and unproductive activities. It requiresfocusing resources on what works.It requires, among other tools and techniques, systematic application of the ParetoPrinciple.Read the original article here: The Secret to Achieving More with Less - The ParetoPrinciple in Action www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 41 | P a g e "The first sign of decline of a company is loss ofappeal to qualified, able, and ambitious people." - Peter F. Drucker www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 42 | P a g eTHE DEMOTIVATION TRAP AND WHATYOU CAN DO ABOUT ITContributor: Robert W. Swaim1 March 2011Understand Drucker’s approachto motivation, and you canforget the countless otherbooks on employee motivation.In this months Drucker Files,Dr. Robert Swaim - student,colleague and friend of PeterDrucker for thirty years -summarizes Druckers SevenKeys to inspiring performance inyour people.There are many textbook definitions of what managers are supposed to do; the jobof the manager, but perhaps one of the more pragmatic definitions is one by PeterDrucker:“A manager is paid to enable those people who are able and capable of work to earntheir wage and not hinder them in the process.” Peter Drucker at the ClaremontGraduate School (1976).Along this line, Dr. Drucker pointed out that, “People know they are on the payroll toget work out. They respect this and also want to respect the company and managerthey work for. When people are not allowed to do the work they are paid for, theylose respect.”THE SEVEN KEYS TO MOTIVATIONThere are Seven Key Areas in which Drucker suggested the manager needs to askquestions relative to motivating performance and include: 1. The performance of your people. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 43 | P a g e 2. Time – the scare resource 3. Taking responsibility for the relationship with others. 4. Establishing and maintaining the relationships with others. 5. Accountability for results. 6. Relationship with your manager. 7. Assignment control and staffing.AREA 1: PERFORMANCEIn terms of motivating the performance of your people, Drucker suggested the firstthing you as a manager can do today is to ask the following questions:  What does this organization do that allows your people to do the job they are paid for?  When you have identified what “helps,” – provide them with more. When you have identified what “hinders,” – remove it. In terms of what hinders your employees the most, don’t speculate and assume you know – ask your employees.AREA 2: TIME  Am I wasting my people’s time?Another area worthy of exploration is the resource of time. No matter what thedemand for time, there is no more supply – it is a perishable resource. Investigate tosee if you are taking time away from your people by making them do things theyreally aren’t paid for.In other words, make sure your people can do the work they are paid for and havethe necessary tools to do it.AREA 3: UNDERSTANDING RELATIONSHIPS  Who depends on me for information, ideas, products, etc.?  Whose input is my output? www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 44 | P a g e  Who do I depend on for my input? As a manager you must take responsibility for your relationship. When you have answered these questions, take the responsibility for establishing and maintaining the relationship. It will probably be no surprise to find many of these relationshipsare with your counterparts in other functional areas. Drucker pointed out that,“Work and information flow sideways thorough the organization, not through theorganization chart.”Therefore, it would also be helpful to keep in mind you are responsible for the workof other people, not just subordinates. This includes yourself, your manager, yourpeers, and finally, your subordinates, in the order of easiest to control, to mostdifficult to control.AREA 4: MAINTAINING RELATIONSHIPSThis logically leads to the fourth area of how to establish and maintain theserelationships, and can be summarized by a very simple Drucker Rule:“Don’t ever assume there are mind readers at work.” Peter DruckerDrucker, in support of this rule stated, “There is no such thing as a communicationsproblem – you have not told them and furthermore, assumed they understood.”Therefore, concentrate on relationships, not communications. You can’t assume thatpeople you deal with don’t need to know – take responsibility by keeping theminformed and let them make the decision whether they need to know or not. Peopledo not trust things they do not understand, so make sure they understand. They maynot approve of what you are doing, but they should at least know what you are tryingto do. Also, it is important they understand what you are not trying to do otherwisepeople will be working on it. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 45 | P a g eAREA 5: ACCOUNTABILITYThe fifth area you should investigate is accountability by asking the next series ofquestions:  What do you do that explains your being on the payroll?  Why do you do this work?  If you don’t do this, what happens?When you have answered these questions, take the responsibility for the results andcontribution, and demand the same of everyone who reports to you.After you have accomplished this, appraise the results of your people, don’t judge.Your job is not to judge people, but to get them to perform. With respect to thisanalysis or appraisal, don’t let effort absorb you, remind yourself of why it is done,and what is the result supposed to be.AREA 6: RELATIONSHIP WITH YOUR MANAGERThe sixth area to explore closely corresponds to relationships and specifically, therelationship you have with your manager. In this regard, it would be helpful to askhim the following questions:  What do I need to know about what you are trying to do?  What is it that he considers to be our organization’s greatest contribution?  What is it you think I should be doing to support you?  What is it I should be concentrating on and held accountable for?When you have answers to these questions, establish a priority list of what must bedone, and begin by concentrating on the first thing on your list. When you havecompleted the first thing, don’t go on to number two on the list, but rather makeanother priority list. You may find number two is still number two, replaced bysomething more critical. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 46 | P a g eAREA 7: ASSIGNMENT CONTROLThe seventh and final area is Assignment Control, or as traditional management textsdescribe as staffing. Every six months, make a list of the people who report to you,and deliver and produce.Then ask the question:  Are they assigned where the results are?If they are not assigned where the demands are for results, they are being mis-allocated. Look at these assignments every six months in terms of planning. Druckerstated, “Plans fail because you don’t allocate an individual who can perform.” If youidentify an opportunity in your plan that can be exploited, it should be staffed withpeople who can deliver.In terms of making this list, don’t get confused between performance and potential.If you have someone on the list that has potential, ask what he or she has done?Don’t be misled by those with high potential, but don’t deliver, look for low potentialpeople who perform. Drucker expanded on this idea by indicating that, “Lowpotential people have learned to perform, to do honest work and not to fail becausethey are not bright enough to improvise.”Finally, don’t leave high performing people assigned to the problem areas too longfor it is a poor use of them. Assigning the best salesmen to move the dead productsin Drucker’s view, “May be an honest and respectable goal, but it is hard work,useless, and the quickest way to create a market for competition.” www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 47 | P a g eDRUCKER ON MOTIVATION“There are only two books that a publisher does not lose money on - cook books andbooks on motivation. The reason is they are purchased by people who can doneither.” Peter DruckerDRUCKER’S CRITICISM OF THE BEHAVIORAL SCIENCES ANDMOTIVATIONAL THEORIES“There have been no major substantive intellectual breakthroughs in ourunderstanding of employee motivation since the Hawthorne Study of seventy yearsago (Elton Mayo)." - Peter Drucker.Drucker’s quote above is in reference to a major event that led to the evolution ofthe Human Relations School in the 1930s. This was the conclusions that weregenerally reached as a result of the infamous “Hawthorne Studies” by Elton Mayoand his colleagues at Harvard, F.J. Roethlisberger and T. N. Whitehead. Although thestudies were originally designed to attempt to measure changes in the employees’working environment and their effect on productivity (the “IlluminationExperiments”), it was finally discovered that the changes that were observed werethe result of other factors, such as how the employees were treated.This lead to the “human relations-be kind to people” approach to motivation thatwas really more manipulative than sincere in attempts to improve productivity.Drucker therefore felt that nothing meaningful in the way of research on motivationhas occurred since then.Of the 39 books Drucker wrote, not one was solely dedicated to discussing leadershipand motivation. In fact, Drucker had little use for the behavioral sciences. Drucker’smajor criticism of the behavioral science was that many of their theories focused onjob satisfaction and ignored productivity. The problem he cited here was that therewas no measurement as to what employee satisfaction really is. If the mean score onthe results of employee attitude surveys registered 85, are the employees moresatisfied than if the score was 75?Drucker also argued that there was no evidence from the behavioral sciences tosubstantiate that employee satisfaction results in any better organizationalperformance – in other words a “happy worker” is not necessarily a productive www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 48 | P a g eworker. Actually, Drucker did feel Frederick Herzberg’s “Two-Factor” theory ofmotivation was useful as a diagnostic tool in terms of assessing an organization’senvironment from the perspective of “dissatisfiers” that tended to support his ownviews on motivation. Drucker therefore made a limited contribution to this schoolbased on a somewhat simplistic approach to leadership and motivation as shared inthis article.THE RESEARCH SUPPORTS DRUCKER’S VIEWSMany studies have been conducted in an attempt to show a relationship between jobsatisfaction and productivity and the results of those studies actually supportDrucker’s views in terms of their inability to prove a positive relationship. Someother studies have actually suggested a causal relationship exists in the oppositedirection in that productivity leads to job satisfaction. These studies concluded that,“If you do a good job, you intrinsically feel good about it. Additionally, assuming thatthe organization rewards productivity, your higher productivity should increaseverbal recognition, your pay level, and probabilities for promotion. These rewards, inturn, increase your level of satisfaction with the job.” Once again, this differentrelationship may actually support Drucker’s views on motivation.“It is easier to de-motivate people than to motivate them.” Peter DruckerDrucker took a completely different and unique approach to the subject ofmotivation by expressing the following views:  It is easier to de-motivate people.  The best way to motivate people is through example.  To set an example by having standards, both of performance and of basics, by realizing that being a manager is not a rank and a privilege, but a responsibility.  To motivate professionals, knowledge people, and managers is by making demands on them for performance and responsibility. (Note: the next article will deal with the growing number of knowledge workers compared to manual workers and their unique job and personal needs and how to measure their performance.) www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 49 | P a g eWHAT DE-MOTIVATES YOUR PEOPLE?In keeping with Drucker’s view, refer to the following statements and ask if you andyour organization are contributing to some of these de-motivators?MY ORGANIZATION AND MANAGEMENT:  Creates a company environment of internal politics as the way to get promoted.  Promotes destructive internal competition between workers.  Changes the rules in the middle of a project.  Creates unclear expectations regarding employees performance and results.  Creates a bureaucracy of forms and reports and unnecessary rules for individuals to follow.  Over manages (tells what to do, how to do, and controls) vs. leading and does not allow autonomy.  Withholds information that individuals need to perform their jobs, lying, and claiming it’s a misunderstanding.  Takes time from people by having them attend unproductive meetings.  Emphasizes criticism and negative feedback vs. recognition and positive feedback.  Tolerates poor performance of others so that high performing people feel taken advantage of.  Treats people unfairly and show favoritism to a select few.  Underutilizes the capabilities of people and inhibits their personal growth. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 50 | P a g eWHAT SHOULD YOU DO AS MANAGER?Refer to the above statements. These were management actions that Drucker feltcontributed to employee de-motivation. Which actions do you and your organizationneed to change to create a more positive and motivating environment? Also reviewthe seven key areas Drucker suggested contribute to organizational performance andanswer the key questions relative to each area. Ideally, you will find Drucker’sapproach to be more useful as compared to reviewing the countless number ofbooks and theories on employee motivation.Read the original article here: The Demotivation Trap and What You Can Do About It www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 51 | P a g e “Efficiency is doing the thing right. Effectiveness is doing the right thing.” ― Peter F. Drucker www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 52 | P a g e5 GLOBAL “CERTAINTIES” YOU CAN’T AFFORD TOIGNOREBy William Cohen, PHD, First Published 25 October 2011Drucker wrote that the purpose ofstrategy is to enable an organizationto achieve its desired results in anunpredictable environment. Socontrary to what many believe,strategy is not about achieving resultsin a known and foreseeableenvironment, but an environmentthat is unknown and unforeseeable. InDrucker’s own words, it allows anorganization to be “purposefullyopportunistic.”THE FIVE CERTAINTIESDrucker was never afraid to propose ideas which others may never have evenconsidered, and this was certainly the case with the five environmental variableswhich he felt were phenomena so unique that they could safely be consideredcertainties and not just possibilities as we normally assume for fixed variables thatwe sometimes call “environmental.”Moreover, he believed that they were different from anything current strategiesconsidered as they were not essentially economic, but were primarily social andpolitical.CERTAINTY #1: COLLAPSING BIRTHRATE IN THE DEVELOPED WORLDDrucker found the falling birthrate in the developed world to be a phenomenonunique in history, with dramatic collateral effects and important secondary effects.Perhaps the most obvious change was in the very old assumption that markets wouldcontinue to increase as the population increased.How many times have we heard that markets are bound to enlarge due to simply tothe automatic increase in birthrate? But Drucker looked at the facts and found thatbirthrates were no longer steadily increasing for populations in the developed world. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 53 | P a g eOf course the decline in birthrate could be somewhat offset, delayed, or somewhatconcealed by immigration. But even this would result in dramatic changes and wouldalso cause turmoil as border populations with different, customs, religions, and evenlanguages were attracted into countries of diminished numbers of younger workers.Drucker saw several important secondary effects resulting from the collapsingbirthrate. He said that for the immediate future demographics would dominate thepolitics in developed countries, shunted aside only temporarily by wars andeconomic conditions.Eventually government instability in developed countries would likely soon becomethe norm. The definition of the concept of retirement was certain to change. Whileearly “retirement” would continue, it would no longer mean a return to childhood insome kind of golden year’s playground. Rather it might mean extended employmentwith the former employer, but under a different name and conditions.We have seen this come to pass even before the onset of the current recession.Drucker noted that older workers, especially the knowledge worker who workedprimarily with his mind and not his hands would become increasingly productive. Hespeculated that firms that first discovered how best to utilize this experienced talentin a new type of relationship would acquire a significant competitive advantage.Perhaps of even more direct importance would be the effect on potential markets.The size of the youth and younger market would inevitably decline and the seniormarket increase. But the increase in potential would not only be due to numbers ofpotential customers, but to the individual purchasing power of those who retiredfrom a first career and continued to find employment while in a “retired” state.CERTAINTY #2: SHIFTS IN DISTRIBUTION OF DISPOSABLE INCOMEDrucker found that the truly important statistic that most companies overlookcompletely is the share of disposable income that is being spent on the products orservices that they provide.Drucker believed that this figure was the most reliable in formulating strategy as itchanged very little over long periods while any change in trends of disposable incomeare crucial to a firm’s strategy. He concluded that utilizing this certainty requiredboth quantitative information and qualitative analysis.Thus another example of looking at data but deciding what the data meant ratherthan primarily crunching numbers.CERTAINTY #3: CHANGING DEFINITION OF PERFORMANCE www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 54 | P a g eAccording to Drucker, the traditional view of performance has been that thecorporation was run for the interest of the manual worker, at least in Japan,Germany, Scandinavian countries and some others. Of course, in the U.S. and Britain,the interests have been somewhat different, at least since the late 1920s.Though not clearly defined, business is supposed to be run for an ill definedconglomeration of interests including customers, employees, shareholders, andsociety. The only big question is whether this should be short term for gain in stockprice, or longer term for future growth.Drucker noted that even “long term” isn’t necessarily all that long since the averagespan of a “successful” enterprise in the U.S. is usually less than thirty years. Theresulting fixed certainty was many traditional views would need to be revisedincluding the definition of performance.These new definitions of performance would have a clear impact on strategy, wouldbe based on longer term estimates, and less and less on “social harmony,” and thatperformance would need to be defined non-financially with a nonfinancial “value”return. Only in this way would this be meaningful to knowledge workers andgenerate the commitment which today is frequently termed “engagement.”CERTAINY #4: INCREASING GLOBAL COMPETITIONAccording to most definitions of global competitiveness, this has to do withcompetiveness of nations. Each year the World Economic Forum compiles a weightedaverage of many different components measured by publically available data andsurveys of a country’s relative competitiveness globally. That’s not what Drucker wastalking about with this certainty.As he looked into the future, no small business, giant corporation, hospital,university, you name it could ignore institutions outside of its own nationalboundaries. It could neither succeed, nor even survive, without measuring up tostandards set by the leaders in its industry anywhere on the planet.Of considerable benefit if our political, corporate, and labor leaders would simplyintegrate the knowledge into their strategies it was Drucker’s contention thattraditional means of protection of home industries no longer protects, “no matterhow high the customs duties nor how low the import quotas.”Drucker predicted the struggles now occurring for increased protectionism. He saidthat the net result of protectionism would not solve a nation’s problems, or aparticular institutions, only make individual companies even more vulnerable. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 55 | P a g eThe only solution was for the organization to find a way to compete considering thestandards set by the best organizations in every area of management no matterwhere located, and essentially to consider such issues as government subsidies ofglobal competitors as environmental variables which must be overcome by superiorstrategies, not by similar protection strategies of its own government.CERTAINTY #5: GROWING INCONGRUENCE BETWEEN ECONOMICGLOBALIZATION AND POLITICAL SPLINTERINGDrucker’s first successful book, The End of Economic Man took on the historic notionthat man behaved rationally in response to economics. According to Drucker, the riseof Nazism disproved that theory.Sixty years later Drucker revisited his earlier work in a management context andstrategy development. His conclusion: even within transnational economic units,national politics will invariably overrule economic rationality.Managers in all industries and disciplines are well advised to consider thesecertainties as equally important to traditional environmental variables usuallyconsidered the sole factors in developing strategy.Read the original article here: 5 Global Certainties You Can’t Afford to Ignore www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 56 | P a g eABOUT THE AUTHORS Dr. Robert W. Swaim was a colleague and personal friend of Drucker’s for nearly thirty years and worked with him for five years prior to his death to develop both the Drucker EMBA and Executive Development Programs that are now offered in China. He is no doubt the foremost authority in Asia on Drucker’s workand in this article he attempts to relate a number of Drucker’s concepts to today’spresent uncertain environment – what would Drucker have said about this and wouldhis concepts still be applicable? Dr. Swaim also expands on these views in his newbook that was released in 2010, The Strategic Drucker: Peter Drucker’s Strategies forBusiness Growth published by John Wiley and Sons (Asia) Pte Ltd. He may be reachedvia email at: docswaim@gmail.com.To see a full list of articles authored by Dr. Robert W. Swaim please go toPEXNetwork.com/RobertSwam Dr. William F. Cohen was Peter Drucker’s first executive Ph.D. graduate at what is now the Peter F. Drucker and Masatoshi Ito Graduate School of Management. His latest books are Drucker on Leadership (Jossey-Bass, 2010) and Heroic Leadership: Leading with Integrity and Honor (Jossey-Bass, 2010). Cohen is the president of The Institute of Leader Arts and a vice president of the26 Peter F. Drucker Academies of China and Hong Kong. He is also a retired Air Forcegeneral. He can be reached at www.stuffofheroes.com.To see a full list of articles authored by Dr. William F. Cohen, please go toPEXNetwork.com/WilliamCohen www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 57 | P a g eLEARN MORE ABOUT PRODUCTIVITYENHANCEMENT THROUGH LEAN SIXSIGMA & BPMIf you’d like to continue your learning, this year’s PEX Week Orlando will be looking athow you can achieve operational efficiencies and take your workforce to higherlevels of productivity through Lean, Six Sigma, BPM and operational excellence.The event takes place 21-25 January 2013 in Orlando, Florida. To find out more aboutthis event or to register, please visit www.pexweek.com. www.pexnetwork.com www.pexweek.com
    • Making Knowledge Workers More Productive: Insights from the Works of Peter F. Drucker 58 | P a g eABOUT USWhat is the Process Excellence Network?PEX Network is an online, free to join, membership portal providing processprofessionals with exclusive access to a library of multimedia resources from topexecutives on Lean Six Sigma, BPM, Operational Excellence, ContinuousImprovement and other process excellence related topics.The Process Excellence Network has a subscribed membership of 80,000+ with anadditional 20,000 connected to us via our social networks and a global contactdatabase of over 450,000.In addition to online resources, PEX Network organizes 30+ targeted face-to-faceevents globally per year with industry specific focuses on Financial Services, Telecoms& Utilities, and Energy. We also hold major cross industry summits on processexcellence in Orlando, FL (PEX Week) and in London, England (PEX Week Europe)every January and April.Contact UsWebsite: www.pexnetwork.comGeneral Inquiries: enquire@pexnetwork.comTelephone: +44 (0)20 7368 9300About the EditorDiana Davis is editor of PEXNetwork.com and follows trends in process excellenceincluding Lean, Six Sigma, and BPM. She worked previously as a producer withAssociated Press Television News and she has also worked in marketing and businessdevelopment in the software industry. Davis holds a Masters in InternationalJournalism from City University, London and a BA in English from the University ofBritish Columbia, Vancouver. She can be reached on diana.davis@pexnetwork.com www.pexnetwork.com www.pexweek.com