vmdrucker.ppt

/56 Elektrotehnicki fakultet, Beograd 1
Drucker, P. F.,
The Effective Executive,
Harper Business,
NY, NY, USA,
1966

Get the right things done!
Be effective!
Essence

 Little correlation between
a man’s effectiveness,
and his intelligence,
imagination, and knowledge!
 Brilliant men are often strikingly
ineffectual!?
 Brilliant insight is not by itself an
achievement, and definitely not the
effectiveness.
Mind Impact

Effectiveness <=
Insight + Hard Systematic Work
 Frenzy rush around and think that they are creative;
 Plodders put on foot in front of the other, and get there first.
 Effectiveness is what converts intelligence, imagination, and
knowledge into results!

Types of Work (1)
 Manual work => efficiency – ability to do things right.
 Knowledge work => effectiveness – ability to get the right things done!
 Manual worker can be judged based on
quantity and quality of a defined discrete output.
Producing a lot is what makes the manual worker effective!
 Knowledge work can be judged based on
the direction of the output generating activity.
 Working on the right things is what makes
the knowledge worker effective!

Types of Work (2)
 In the past,
manual workers predominated
in every organization.
 Now,
the center of gravity has shifted to
the knowledge worker!
 Every knowledge worker is an executive,
and most, but not all, managers are executives.

A non-effective knowledge
worker has a tendency
to become a manual worker,
and
to rush around w/o much
thinking.
Philosophy

 In every organization, there are four realities over which the executive
has no control, and has to “cooperate with the inevitable”:
a. The executive’s time
tends to belong to everybody else.
b. The executive has to keep on operating,
unless they take positive action to change the reality.
c. The executive is effective only when
other people make use of what he produces.
d. The executive’s view of outside is limited, as much as
his subordinates tell him.
Important Realities

Effectiveness Can Be Learned!
 Effectiveness is a series of practices.
 Practices can be learned.

The Five Major Practices of
Effective Management:
1. Effective executives know where their times goes,
and they manage carefully the little time that is under their control.
2. Effective executives focus on “What results are expected of me?”
rather than on “What I have to do?”.
3. Effective executives build on the strengths (on what they can do),
and not on the weaknesses (what they can not do).
4. Effective executives concentrate on the few major areas
where superior performance will produce outstanding results.
5. Effective executives judge based on options,
which are defined carefully.

Effective Executives (1)
- Do not start with their tasks, but with their time!
- Do not start with their plans, they start with where their time actually goes.
Then they cut back the unproductive demands on their time.
- Plans always remain on paper, always remain good intentions.
They seldom turn into achievements!

 Time is the most critical resource of an Effective Executive.
 If we rely on our memory, we do not know how our time was spent.
 Consequently, an Effective Executive must record his time,
to know where it actually goes,
in order to be able to rationalize its future time spending.
 Every executive has to spend a great deal of its time
on things that do not contribute at all
(e.g. official dinners or when the best customer calls).
 People around us are time consumers,
and most people are time wasters.

 On the other hand, things get done if one dedicates
non-trivial amounts of time to them.
 If executive wants to get to the point where he wants to have an impact,
he needs to spend at least an hour in a meeting with his subordinates.
 If one wants to establish a human relationship, one needs infinitely more time!
 Relationships with other knowledge workers are especially time consuming.
 Without this, knowledge workers loose their enthusiasm, and either become
time servers, or they direct their talents to activities outside the company.

Several hours of continued
and uninterrupted thought – the main
prerequisite for right decision making
(e.g., Sloan says,
“The first thought is always wrong”).

Time Influence (1)
 Time has to be recorded in real-time, not from memory.
 Only when one records time, one can become
aware of the fact that most of it leaked away on trivia.
 Systematic managing of time implies that one gets rid
of time-wasting activities, if one possibly can.

Time Influence (2)
This requires asking oneself a number of diagnostic questions:
a. What would happen if this were not done at all?
This is a way to identify things that need not be done!
One has to learn how to say NO!
Often, people expect you to say no when they invite you.
b. Which activity in my time log could be done by someone else just as well or better?
This is a way to move the burden onto someone else’s shoulder.
Do not forget that delegation exists in management, too.
c. What do I do that wastes your time, without contributing to your effectiveness?
This is a way to determine what and how much of the time of our subordinates we waste.
Very few executives dare to ask this question, because they are afraid of the truth.

Time Influence (3)
 Much of the time loss results from poor management and deficient organization
 Poor management wastes everybody’s time, but above all, it wastes the manager’s time.
 How to identify time-wasters that follow from lack of system or look-ahead?
The first symptom to look for is the recurrent crisis
(a crisis that comes back time after time).
As soon as it happens, mechanisms have to be established,
which make it manageable by a low level clerk
(so it becomes a routine job).
 Routine is what makes unskilled people without judgment able to do
what it took a near-genius to do before.
However, to turn such a job into a step-by-step procedure
often times needs an almost-genius.

 A clear sign of overstaffing is when management
spends more than 10% of its time on HR issues!
 Do not bring in a specialist unless
he is used day in and day out.
Otherwise, he better stays outside!
Tips!

Malorganization
 Symptom – excess of meetings!
 One either meets or one works. Can not do both at the same time.
 It is not brainstorming or asking for help.
 In a good organization, there would be no meetings.
 Meetings have to be purposely directed.
 An undirected meeting is not just a time sink. It is a danger!
 Meetings have to be an exception, rather than the rule.
 Organization in which one meets all the time is an organization
in which no one gets any work done.
 If the time log tells that more than 10% of time
was spent in meetings, one has to start thinking.

Malfunction of Information
 It is the best if there is only one item on the agenda of the meeting.
 90 minutes (Why)?
Attention span is that long and serious meters
can not be explained/considered in less time!
An Effective Executive never allows an interrupt within these
90 minutes. Why?
Secretary holds each call for 90 minutes,
and the boss schedules 30 minutes of free time, after each
90 minute meeting slot, to respond to all calls and emails.

How to Get Rid of Nuisance?
 One day per week, work from home invisible till 10am.
 Wake up hours before work, to study important issues!
 Time is the scarcest resource, and unless it is managed,
nothing else can be managed.

How Can I Contribute? (1)
 Most executives tend to concentrate on the efforts,
rather then on the results.
 To give my managers the right info,
so they can make right decisions!
 To find out what products will our customers need tomorrow!

 What is the right answer to the following question:
What do you do to justify being on the payroll?
1. I run the accounting department!
2. I have 800 people working under me!
Wrong!
 The man who focuses on his position (1st answer)
and on his downward authority (2nd answer)
is not an Effective Executive, and is a subordinate,
no matter how exalted his title and rank!
 To ask “What can I contribute?”
is to look for unused potential of the job.

 Effective Executive can contribute in three different areas:
1. Building direct results, mostly profit (before all, profit).
2. Building of values and their reaffirmation
(e.g., family farm versus industrial agriculture).
3. Building and developing people for tomorrow
(people adjust to the level of demand made on them).
 The most common cause of executive failure is
inability or unwillingness to change
with the demands of a new position.

How to Make
the Specialist Effective?
- For the knowledge worker to be effective, he has to be specialist.
- Generalists are those who are specialized in several areas,
and know how to generate synergistic effects.
- Most specialists in several areas are not generalists!

Impact of Human Relationship (1)
 The right human relationship.
 If a good human relationship is developed in a company,
this is because the executive focuses on his contribution,
and not because he has a “talent for people”.
 Warm feelings and pleasant words are meaningless,
if there is no achievement!

Impact of Human Relationship (2)
 Four basic requirements
of effective human relations:
a. Communications
b. Teamwork
c. Self-development
d. Development of others

Communications
 Typical questions that induce a strong
bottom-up communication:
- What is the best utilization of your knowledge and ability?
- What should we expect of you?
- How can I be useful to you?

Teamwork
 The more sophisticated the knowledge work,
the more is the teamwork needed.
 Remember, one bad apple can spoil all good apples!
 So, the more sophisticated the knowledge work,
the more carefully one has to select team members!

Self-Development
 If one asks himself:
- What is the most important contribution I can make
to the performance of the organization I belong to?
 He is actually asking himself:
- What self-development do I need?

Development of Others
If employees demand little of themselves,
they will remain stunted.
If they demand a good deal of themselves,
they will grow to a giant stature
(with not much more effort than expected by non-achievers)!

The Effective Meeting (1)
 Each meeting/presentation/report has a goal/purpose:
1. Decision
2. Giving information or getting informed
3. Making clear to ourselves what we should be doing
 The goal/purpose of the meeting
has to be thought through
and spelled out before
the meeting is called,
a presentation is organized,
or a report is asked for.

The Effective Meeting (2)
 If the intention was to make things clear to ourselves,
it is a “brainstorming” and the more bright ideas the participants have,
the more successful the meeting is.
 If the intention was something else and it turns into everybody having
“bright” ideas, it is called a “bull meeting”,
and the more “bright” ideas the participants have,
the less successful the meeting is!
 At the end of each meeting, one must go again
to the “opening statement”, to double-check
if the final conclusions are in-line with original intentions!

Meetings - Rules of Importance
- You either come to listen to important things being said,
or you come and take part and you talk; you can not do both!
- You must have a wider view!
- You must keep the focus from the start to the end!
This is the cardinal rule!
If a meeting turns into chaos, the top level man is to be blamed!

Making Strength Productive
 One can not build on weaknesses of the organization;
one can build only on the strengths of the organization!
 Make the weaknesses irrelevant.
 Make the strength productive.
 Do not hire because of the lack of weaknesses;
hire because of an important strength!
 The first approach staffs you with mediocrity;
the second one with a winning team!

Strong People Always Have
Strong Weaknesses, too!
 People with no weaknesses are often incompetent!
 No executive has ever suffered because his subordinates
were stronger than him.
 Only very strong men dare to think that way!
 Effective Executive knows that his subordinates are paid to perform,
and not to please their superiors!

 Of course, everyone knew that these men were better in the following sense:
For each activity, Carnegie was able to find a person by far better than him, an the
was the master who combined all these activities into a great success story.
On the tombstone of Andrew Carnegie
(the father of US steal):
“Here lies a man who knew how to bring into his
service men better than he was himself”.

Important Questions
 Effective Executive never asks himself:
“How does he get along with me?”
He asks: “What does he contribute?”
 Each person can contribute in only one area!
 Universal geniuses do not exist!
Effective Executive always checks first what a man can do well,
and then demands that to be done.

Why Executives Pick
a Wrong Associate?
 The main reason is that the immediate task of the executive
is not to place a man, but to fill a job;
then they place the “least misfit” or they
change the job description – both wrong!
 Another frequent reason: Hiring friends – wrong!
Even worse to turn colleagues into friends!
Successful men like Roosevelt, Sloan, Lincoln
had no “friend” in their Cabinet, although they were warm men
in need of close human relationships, but they keep it off the job.
 A rare reason: because they follow the above rules inflexible!
 Exceptions always exist!

How to Pick a Right Associate?
1. Do not start with the assumption that jobs are created by nature of God;
instead they have been designed by fallible men.
Often they look logical on paper, but can not be filled.
Typical for jobs created to match a person.
Symptom: Several hires did not succeed.
The Effective Executive first must make sure that the job is well designed.
2. Make big and demanding jobs.
Divide and conquer applies only to non-sophisticated jobs.
Only such jobs enable men to rise to the new demands of a changed situation
(job requirements keep changing).
3. Effective Executive starts with a what a man can do, and not with what a job requires.
Be positive! Work changes people. Work brings health!
4. In order to get strength, one has to put up weaknesses!

How Do I Manage My Boss?
 If the boss is not promoted, you will be bottled behind him.
 If the boss is fired, it is rarely a young man behind him
who comes to his position.
 If the boss is promoted, you go up, too.
 Tell him what is wrong,
in a way that will not hurt his feelings!

People are Either
Readers or Listeners
 Do not waste your time trying to talk to a reader,
or to send email to a listener!
 Note that some people learn
while they talk (Roosevelt, Churchill);
so, make them talk about their improvements!
 All of us are “experts” on other people,
so changing your boss is doable;
only, make sure that you attack strengths,
and not weaknesses!

Making Yourself Effective
 People are always aware of what they are not allowed
or supposed to do! As a result, they waste time
by complaining about what they can not do.
 Effective Executive tries to improve on what he can do!
 Be positive!

Some People Work the Best
Under Pressure
 Others work better if they have great deal of time,
and can finish the job well before the deadline!
 Know yourself and adapt your work policies to that!
 It is easier to rise performance of one leader,
then of a whole mass.

If There is One Secret to Effectiveness,
it is Concentration
 Effective executives do the first thing first,
and they do one thing at the time.
- Why?
There is always more contributions to do,
then the time available, so you can not do all;
if you can not do all, you must do the highest rank first!

The Major Problem is:
What is the Right Ranking?
 That depends on the general strategy,
and the criteria within that strategy.
 Example:
NL is typically awarded to an absent minded prof!
 Always ask yourself: “Is this worth Doing?”

Multitasking
 Some people are the best in one task at the time!
 Others like two at the time, timesharing.
 Three, only if single-minded concentration on
one task at a time!
This is the secret of those who do so many things successfully!

How Much Time to Assign?
 More than expected,
because unexpected always happens;
the unexpected is indeed the only thing
that one can confidently expect.

Priorities and Posteriorities
 What tasks to tackle, and what not?
 Know how to forget!
 Setting posteriorities in not easy,
because every posteriori is someone’s priority!

Priorities
 Courage rather than analysis
dictates the truly important rules
for identifying priorities:
1. Pick the future as against the past.
2. Focus on opportunity rather than a problem.
3. Choose your own direction,
rather then climbing on the bandwagon.
4. Aim high, rather than on something
easy and “safe”.

The Elements of Decision Making
 Effective Executives do not make great many decisions;
they concentrate on the few important ones;
they think about strategic and generic,
rather than problem solving.
 The most time consuming step in the process
is not to make the decision, but to put it into effect.

Elements
of the Decision Making Process
1. Clear realization that the problem was generic,
and could be solved only by establishing a rule or a principle.
2. Definition of the boundary conditions of the solution.
3. Thinking about what is right.
4. Building onto the decision of the action to carry it out.
5. Feedback.

Effective Decisions
 Decision is a choice between alternatives.
 It is rarely a choice between right and wrong.
 It is typically a choice between alternatives
of which none is provably better.

Many Books State That
One Has to Start with Facts
 Actually, one has to start with opinions
(untested hypotheses).
 Often the method is: Producing disagreement!
 Disagreement is needed to stimulate imagination!
 So, the effective decision maker organizes disagreement.

Decision Making and
the Computer
 The computer will force executives to make, as true decisions,
what is today made mostly as on-the-spot adaptations.
 The greatest impact of the computer lies in its limitations.
95

Drucker, P. F.,
The Effective Executive
QUESTIONS?

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