Lessons I learned from Peter Drucker

1. First, manage thyself. – If you want the average performance of those around you to go up, you must first improve your own performance.
2. Do what you’re made for. – Your first responsibility is to determine your own distinctive competencies, what you can do uncommonly well, and what you are truly made for, and then navigate your life and career in direct alignment. | Do what you’re made for, yes, but then get better and better; eradicate weakness, yes, but only within strength.
3. Work how you work best(and let others do the same). – No one but you can take responsibility to leverage how you best work.
4. Count your time, and make it count. – The secret of people who do so many difficult things is that they do only one thing at a time; they refuse to let themselves be squandered away. This requires the discipline to consolidate times into blocks. i) create unbroken blocks for individual thinking time, preferably during the most lucid time of day. ii) create chunks of deliberately unstructured time for miscellaneous and inevitable matters. iii) engage in meetings that matter.
5. Prepare better meetings. – Effective people develop a recipe for how to make the most of meetings: preparation with a clear purpose in mind and disciplined follow-up.
6. Don’t make a hundred decisions when one will do. – zoom out and make a few big generic decisions that can apply to many specific situations, to find a pattern within → from chaos to concept.
7. Find your one big distinctive impact. – Identify one big thing that would most contribute to the organization’s future. If you make one distinctive contribution, a key decision that would only have happened with your leadership then you will have rendered excellent service. What is the one absolutely fundamental contribution that would not happen without you?
8. Stop what you would not start. – If it were a decision today to start something you are already in (to enter a business, to hire a person, to institute a policy, to launch a project, etc) would you? If not, then why do you persist?
9. Run lean – Get better people, give them really big things to do, enlarge, their responsibilities, and let them work. The fewer people, the smaller, the less activity inside, and the more nearly perfect the organization.
10. Be useful – “How to be successful is the wrong question. The question is: how to be useful”

Eight Practices

1. “What needs to be done?”
2. “What is right for the enterprise?”
3. They developed action plans.
4. They took responsibility for their decisions.
5. They took responsibility for communicating.
6. They were focused on opportunities rather than problems.
7. They ran productive meetings.
8. They thought and said “we” rather than “I”.

💡 Effective executives concentrate on one task at a time if possible.

💡 Enterprises perform if top management performs, and don’t if it doesn’t.

How to write an action plan:

• Think about desired results, probable restraints, future revisions, check-in points, and implications for how he’ll spend his time.
• What contributions should the enterprise expect from me over the next two years? What results will I commit to? With what deadlines?

A decision has not been made until people know:

• the name of the person accountable for carrying it out;
• the deadline;
• the names of the people who will be affected by the decision and therefore have to know about, understand, and approve it-or at least not be strongly opposed to it;
• the names of the people who have to be informed of the decision, even if they are not directly affected by it.

💡 EEs share their plans with and ask for comments from all their colleagues, superiors, subordinates, and peers.

Let each person know what information they’ll need to get the job done.

💡 Organizations are held together by information rather than by ownership or command.

💡 Treat change as an opportunity rather than a threat.

7 situations for opportunities:

1. an unexpected success or failure in their own enterprise, in a competing enterprise, or in the industry
2. a gap between what is and what could be in a market, process, product, or service
3. innovation in a process, product, or service, whether inside or outside the enterprise or its industry
4. changes in industry structure and market structure
5. demographics
6. changes in mindset, values, perception, mood, or meaning
7. new knowledge or a new technology

💡 EEs put their best people on opportunities rather than on problems.

Ask each member of the management group to prepare two lists every six months; a list of opportunities for the entire enterprise and a list of the best-performing people throughout the enterprise. These are discussed, then melded into two master lists, and the best people are matched with the best opportunities.

💡 Make meetings productive. Make sure that meetings are work sessions.

Decide in advance what kind of meeting it will be.

💡 Terminate the meeting as soon as its specific purpose has been accomplished.

Follow-up is just as important as the meeting itself.

Summarize the discussion and its conclusions and spell out any work assignment decided upon in the meeting(including a decision to hold another meeting on the subject or to study an issue). Specify the deadline and the executive who was to be accountable for the assignment.

💡 Don’t think or say “I”. Think and say “we”.

💡 Listen first, speak last.

Effectiveness can be Learned

Everyone who, as a knowledge worker, is responsible for actions and decisions which are meant to contribute to the performance capacity of his organization = “Executives”

EEs are effective only if and when other people make use of what he contributes.

The fewer people, the smaller, the less activity inside, and the more nearly perfect the organization in terms of its only reason for existence: the service to the environment.

The truly important events on the outside are not the trends. These ultimately determine the success or failure of an organization and its efforts. Such changes, however, have to be perceived; they cannot be counted, defined, or classified.

Effectiveness, in other words, is a habit, a complex of practices. And practices can be learned.

5 habits of the mind that have to be acquired to be an EE:

1. know where their time goes. Work systematically at managing their time.
2. Gear their efforts to results rather than to work.
3. Build on strengths-strength of their own, superiors, colleagues, subordinates, and the situation.
4. Concentrate on a few major areas where superior performance will produce outstanding results.
5. Make effective decisions.

Know Thy Time

EEs do not start with their tasks. They start with their time. They do not start out with planning. They start by finding out where their time actually goes. Then they attempt to manage their time and cut back unproductive demands on their time.

Finally, they consolidate their “discretionary” time into the largest possible continuing units. This 3-step process:

1. recording time.
2. managing time.
3. consolidating time.

💡 The demand for capital, rather than the supply thereof, sets the limit to economic growth and activity.

EEs know that to manage their time, he first has to know where it actually goes.

EEs, take time out on a regular schedule to sit down with knowledge workers.

They ask: “What should we at the head of this organization know about your work? What do you want to tell me regarding this organization? Where do you see opportunities we do not exploit? Where do you see dangers to which we are still blind? What do you want to know from me about the organization?”

The more people have to work together, the more time will be spent on “interacting” rather than on work and accomplishment.

The first step towards becoming an EE is to record actual time use.

Time management is the next step.

In order to find and get rid of nonproductive, time-wasting activities:

1. Try to identify and eliminate the things that need not be done at all, the things that are a pure waste of time without any results whatever. To find these time-wasters: “What would happen if this were not done at all?”
2. “Which of the activities on my time log could be done by somebody else just as well, if not better?” – Getting rid of anything that can be done by somebody else so that one does not have to delegate but can really get to one’s own work; that is a major improvement in effectiveness.
3. “What do I do that wastes your time without contributing to your effectiveness?” – The manner in which an EE does productive work may still be a major waste of somebody else’s time.

We usually tend to overrate rather than underrate our importance and conclude that far too many things can only be done by ourselves.

Poor management wastes everybody’s time-but above all, it wastes the manager’s time.

💡 A crisis that recurs a second time is a crisis that must not occur again.

A recurrent crisis should always have been foreseen. It can therefore either be prevented or reduced to a routine that clerks can manage.

💡 The recurrent crisis is simply a symptom of slovenliness and laziness.
→ A well-managed factory is boring. Nothing exciting happens in it because the crises have been anticipated and have been converted into a routine.

One should only have on a team the knowledge and skills that are needed day in and day out for the bulk of the work.

💡 An undirected meeting is not just a nuisance; it is a danger.

Working at home one day a week can tremendously help with time consolidation.

Other men schedule all the operating work-the meetings, reviews, problem sessions, and so on for two days a week, for example, Monday and Friday, and set aside the mornings of the remaining days for consistent, continuing work on major issues.

The reason why working home nights is so popular is actually its worst feature: It enables an executive to avoid tackling his time and its management during the day.

💡 Time is the scarcest resource, and unless it is managed, nothing else can be managed.

What can I contribute?

The EE focuses on the contribution.

EEs who do not ask themselves, “What can I contribute?” are not only likely to aim too low, they are likely to aim at the wrong things.

Every organization needs performance in three major areas:

It needs direct results.

Building of values and their reaffirmation.

Building and developing people for tomorrow.
→ If deprived of performance in any one of these areas, it will decay and die.

→ People adjust to the level of the demands made on them.

💡 The EE who sets his sights on contribution raises the sights and standards of everyone with whom he works.

Commitment to contribution is a commitment to responsible effectiveness. Without it, a man shortchanges himself, deprives his organization, and cheats on the people he works with.

The 4 basic requirements of effective human relations:

• communications
• teamwork
• self-development
• development of others

“What are the contributions for which this organization that your superiors should hold you accountable?”

“What should we expect of you?”

“What is the best utilization of your knowledge and your ability?”

“Who has to use my output for it to become effective?” – will immediately show up the importance of people who are not in the line of authority.

💡 The more we automate information handling, the more we will have to create opportunities for effective communication.

The man who asks himself “What is the most important contribution I can make to the performance of this organization? asks in effect “What self-development do I need? What knowledge and skill do I have to acquire to make the contribution I should be making? What strengths do I have to put to work? What standards do I have to set myself?”

💡 People in general, and knowledge workers in particular, grow according to the demands they make on themselves.

EEs know what they expect to get out of a meeting, a report, or a presentation and what the purpose of the occasion is or should be.

They ask themselves: “Why are we having this meeting? Do we want a decision, do we want to inform, or do we want to make clear to ourselves what we should be doing?”

They insist that the purpose be thought through and spelled out before a meeting, a report asked for, or a presentation organized.

They insist that the meeting serves the contribution to which they have committed themselves.

The EE always states at the outset of a meeting the specific purpose and contribution it is to achieve. He makes sure that the meetings address their purpose.

💡 EEs, at the end of meetings, goes back to the opening statement and relate the final conclusion to the original intent.

Making Strength Productive

One cannot build on weakness. To achieve results, one has to use all the available strengths.

The strengths of associates, superiors, and one’s own strength. These strengths are true opportunities. To make strength productive is the unique purpose of the organization.

EEs do not make staffing decisions to minimize weaknesses but to maximize strengths.

The EE who is concerned with what a man cannot do rather than with what he can do, and who therefore tries to avoid weaknesses rather than make strength effective is a weak man himself.

By staying aloof it is possible to build teams of great diversity but also strength.

Any job that has defeated two or three men in succession, even though each had performed well in his previous assignments, must be assumed unfit for human beings. It must be redesigned.

Make each job demanding and big. It should have the challenge to bring out whatever strength a man may have. It should have a scope so that any strength that is relevant to the task can produce significant results.

There is no such test appropriate to knowledge work. What is needed in knowledge work is a configuration, and this will be revealed only by the test of performance.

The ones who are enthusiastic and who, in turn, have results to show for their work, are the ones whose abilities are being challenged and used.

EEs know that they have to start with what a man can do rather than with what a job requires.

Arrive at a man’s appraisal before deciding whether he is the right person to fill a bigger position.

💡 All one can measure is performance. And all one should measure is performance.

One can measure the performance of a man only against specific performance expectations.

Ask 4 questions:

1. What has he done well?
2. What, therefore, is he likely to be able to do well?
3. What does he have to learn or acquire to be able to get the full benefit from his strength?
4. If I had a son, would I be willing to have him work under this person? Why?

💡 It is the duty of the EE to remove ruthlessly anyone, and especially any manager, who consistently fails to perform with high distinction.
→ To let such a man stay on corrupts the others. It is grossly unfair to the whole organization.

To focus on weakness is not only foolish; it is irresponsible. A superior owes it to his organization to make the strength of every one of his subordinates as productive as it can be.

While the others complain about their inability to do anything, the EEs go ahead and do it.

Making strength productive is as much an attitude as it is a practice.

💡 In every area of effectiveness within an organization, one feeds the opportunities and starves the problems. Nowhere is this more important than with respect to people.

Only strength produces results. Weakness only produces headaches, and the absence of weakness produces nothing.

💡 The standard of any human group is set by the performance of the leaders.

Never allow leadership performance to be based on anything but true strength.

In human affairs, the distance between the leaders and the average is constant.

💡 If leadership performance is high, the average will go up.

The EE knows that it is easier to raise the performance of one leader than it is to raise the performance of a whole mass. He, therefore, makes sure that he puts into the leadership position, into the standard-setting, the performance-making position, the man who has the strength to do the outstanding, the pace-setting job.

First Things First

If there is any one “secret” of effectiveness, it is concentration.

The more an EE works at making strengths productive, the more will he become conscious of the need to concentrate the human strengths available to him on major opportunities. This is the only way to get results.

Doing one thing at a time, and doing first things first.

Ask yourself “Is this still worth doing?” And if it isn’t, he gets rid of it so as to be able to concentrate on the few tasks that, if done with excellence, will really make a difference in the results of his own job and in the performance of his organization.

The EE will slough off an old activity before he starts on a new one.

Most EEs have learned that what one postpones, one actually abandons.

The Elements of Decision-Making

EEs make decisions as a systematic process with clearly defined elements and in a distinct sequence of steps.

The elements of an effective decision process

1. The first question the EE asks is: “Is this a generic situation or an exception?”

The generic always has to be answered through a rule, a principle.

The exceptional can only be handled as such and as it comes.

💡 All events but the truly unique ones require a generic solution. They require a rule, a policy, a principle.

The EE always assumes that the event that clamors for his attention is in reality a symptom. He looks for the true problem.

The EE decision-maker always tries to put his solution on the highest possible conceptual level.

The EE asks himself “If I had to live with this for a long time, would I be willing to?” If the answer is No, he keeps on working to find a more general, more conceptual, more comprehensive solution-one that establishes the right principle.

The EE also always tests for signs that something atypical, or something unusual is happening; he always asks “Does the explanation explain the observed events, and does it explain all of them?”; he always writes out what the solution is expected to make happen-and then tests regularly to see if this really happens; and finally he goes back and thinks the problem through again when he sees something atypical, when he finds phenomena his explanation does not really explain, or when the course of events deviates, even in details, from his expectations.

2. The second question the EE asks: “What are the objectives the decision has to reach?”

Clear specifications as to what the decision has to accomplish.

The more concise and clear boundary conditions are stated, the greater the likelihood that the decision will indeed be an effective one and will accomplish what it set out to do.

Conversely, any serious shortfall in defining these boundary conditions is almost certain to make a decision ineffectual, no matter how brilliant it may seem.

1. One has to start out with what is right rather than what is acceptable (let alone who is right) precisely because one always has to compromise in the end.
2. Convert decision into action. Thinking through the boundary conditions is the most difficult step in decision-making. Converting the decision into effective action is usually the most time-consuming one.

Converting a decision into action requires answering several distinct questions:

• Who has to know of this decision?
• What action has to be taken?
• Who is to take it?
• And what does the action have to be so that the people who have to do it can do it?
• The first and last of these are too often overlooked-with dire results.

Feedback has to be built into the decision to provide continuous testing, against actual events, of the expectations that underlie the decision.

💡 The officer who has given an order goes out and sees for himself whether it has been carried out.

To go and look for oneself is also the best, if not the only way to test whether the assumptions on which a decision has been made are still valid or whether they are becoming obsolete and need to be thought through again.

Effective Decisions

The EE insists that people who voice an opinion also take responsibility for defining what factual findings can be expected and should be looked for.

The crucial question here is: “What is the criterion of relevance?”

💡 Unless one has considered alternatives, one has a closed mind.

This, above all, explains why EE decision-makers create dissension and disagreement, rather than consensus.

💡 The right decision demands adequate disagreement.

3 main reasons for the insistence on disagreement:

1. It is the only safeguard against the decision-maker becoming the prisoner of the organization.
2. Disagreement alone can provide alternatives to a decision.
3. Disagreement is needed to stimulate the imagination.

💡 One needs “creative” solutions which create a new situation.
→ One needs imagination-a new and different way of perceiving and understanding.

💡 Imagination needs to be challenged and stimulated.

The EE organizes disagreement.

💡 Disagreement converts the plausible into the right and the right into the good decision.

The EE starts out with the commitment to find out why people disagree.

The EE is concerned first with understanding.
→ Only then does he even think about who is right and who is wrong.

The EE decision-maker either acts or doesn’t act.
→ He does not take half-action. This is the one thing that is always wrong.

There is no inherent reason why medicines should taste horrible-but effective ones usually do.

Similarly, there is no inherent reason why decisions should be distasteful-but most effective ones are. → Effective decisions leave a bad taste in your mouth.

Effectiveness Must Be Learned

This book rests on two premises:

1. The executive’s job is to be effective; and
2. Effectiveness can be learned.

💡 The executive is paid for being effective.

While capable of being learned, surely cannot be taught. Effectiveness is, after all, not a “subject”, but self-discipline.

The first step toward effectiveness is a procedure: recording where the time goes.

If this is all the executive ever does, he will reap a substantial improvement.
→ Record time.

The executive is asked to focus his vision on contribution advances from the procedural to the conceptual, from mechanics to analysis, and from efficiencies to concern with results.

In focusing himself and his vision on the contribution the executive has to think through purpose and ends rather than means alone. → Focus on contribution.

1. Make strengths productive.
2. Rational action.

It is the way towards the performance of the organization.

💡 As executives work toward becoming effective, they raise the performance level of the whole organization.

They raise the sights of people-their own as well as others.

Organizations are not more effective because they have better people.

They have better people because they motivate self-development through their standards, their habits, through their climate.

These, in turn, result from systematic, focused, purposeful self-training of the individuals in becoming EEs.

💡 Organizations as well as executives need to work systematically on effectiveness and need to acquire the habit of effectiveness.

The EE’s level, his standards, and his demands on himself determine to a large extent the motivation, direction, the dedication of the other knowledge workers around him.

💡 Self-development of the executive toward effectiveness is the only available answer.

It is the only way in which organizational goals and individual needs can come together.

The executive who works at making strengths productive-his own as well as those of others-works at making organizational performance compatible with personal achievement.

Afterword

The EE aims beyond himself by focusing on contribution.

This requires turning one’s attention away from “one’s own specialty, one’s own narrow skills, one’s own department, and toward the performance of the whole.”

Although analysis should always shape and inform action, it cannot provide the initial spark required to create action.

With courage, knowledge becomes productive.

Pick the future as against the past.

Choose your own direction rather than climb on the bandwagon.

💡 Aim high, aim for something that will make a difference, rather than for something that is ‘safe’ and easy to do.