"Management" means, in the last analysis, the substitution of thought for brawn and muscle, of knowledge for folklore and superstition, and of cooperation for force. . .
People and Performance
My February issue of the Harvard Business Review came in a couple of days ago, and I just finished reading a great article on "What Executives Should Remember." This article is a "best of" compilation of some phenomenal essays by the late Peter F. Drucker (1909-2005), perhaps the most influential business thinker in the last century.
These are the kinds of articles that keep me coming back to the HBR as a subscriber. If you don't subscribe, head down to the book store or news stand and pick up this issue even if this is the only article in there that you read.
Here an example of what I took away from this piece:
It's wrong to keep doing "the right things" after the old reasons no longer exist.
In the first essay of this compilation, "The Theory of Business," Drucker talks about how so many companies find a routine that works for them and then cling to that routine long after the world has moved on. It's the old story of "survival of the most adaptive," and he uses GM as an example (he wrote this article back in 1994, by the way).
There is a great discussion of how the "right thing" for success in business is dependent on the times you live in, and the conditions that impact you. This isn't about values, ethics, compassion, or any of that - it's about effective response to changing economic realities. Sure, some of those economic changes are driven by social change, but social responsibility alone isn't enough to drive business success. A cost model is an unfeeling bastard (my words, not his).
I love Drucker's closing thought in this piece: "[CEO's of stumbling organizations] accept that a theory's obsolescence is a degenerative and, indeed, life-threatening disease. And, they know and accept the surgeon's time-tested principle, the oldest principle of effective decision making: A degenerative disease will not be cured by procrastination. It requires decisive action." Whoa.
More nuggets of gold await you, o reader!
The other essays are excellent, as well.
- In 1963's "Managing for Business Effectiveness," he tells us how to "organize the job of managing for economic effectiveness and how to do it with both direction and results." This is masterfully done through his treatment of the three questions: "What is a managers job?," What is the major problem?," and "What is the principle?"
- In "What Business Can Learn from Nonprofits," from 1989, when he talks about how nonprofits have a stronger sense of mission, a higher sense of responsibility, and better focus on the long term than their for-profit peers. His theory is that a big reason for this is that the nonprofit board is more committed and active. Indeed, in many cases, the board members are some of the largest financial contributors to the organization, and have often spent their own time volunteering to support the cause. Very thought-provoking.
- In "The New Society of Organizations," 1992, you'll find a disconcerting discussion about how modern organizations are a destabilizing influence (as opposed to society, community, and family which are all "conserving institutions" that try to maintain stability by preventing or slowing change). Again, this essay is even more interesting in light of the recent public challenges of Ford, GM, et al.
- And the fun continues through "The Information Executives Truly Need," "Managing Oneself," "They're Not Employees, They're People," and "What Makes an Executive Effective" (the last line says it all: Listen first, speak last.)
I really only began to appreciate the wisdom of Peter Drucker about 3 years ago. When he died in November, I was sad to hear the news. But the ideas of this special man live on in his writing - pick up a copy of HBR and see for yourself.