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"Effectiveness as an executive...consists of a small number of practices..." "...these practices are not "inborn". In forty-five years of work as a consultant... I have not come across a single "natural"... All the effective ones have had to learn...and...to practice.. But all the ones who worked on making themselves effective executives succeeded in doing so."
"An effective executive does NOT need to be a leader in the sense that the term is now most commonly used."
"...some of the best... CEOs I've worked with over a 65-year consulting career were not stereotypical leaders. They were all over the map in terms of their personalities, attitudes, values, strengths, and weaknesses. They ranged from extroverted to nearly reclusive, from easygoing to controlling, from generous to parsimonious.
What made them all effective is that they followed the same eight practices:
They asked, ‘What needs to be done?’
They asked, ‘What is right for the enterprise?’
They developed action plans.
They took responsibility for decisions.
They took responsibility for communicating.
They were focused on opportunities rather than problems.
They ran productive meetings.
They thought and said ‘we’ rather than ‘I.’The first two practices gave them the knowledge they needed. The next four helped them convert this knowledge into effective action. The last two ensured that the whole organization felt responsible and accountable."
"I’m going to throw in one final, bonus practice. This one’s so important that I’ll elevate it to the level of a rule: "Listen first, speak last.”"
"Note that the question is not 'What do I want to do?'" Example: when Truman became U.S. president, he wanted to do more of the New Deal reforms, but what had to be done was foreign policy. When Jack Welch became CEO at GE he wanted to do an overseas expansion, but what needed to be done was getting rid of businesses that could not be #1 or #2 in their industries.
"...Concentrate on one task if at all possible." If you are in the "sizable minority—who work best with a change of pace in their working day, [then] pick two tasks. I have never encountered an executive who remains effective while tackling more than two tasks at a time."
"..after completing the original top-priority task, ... [reset] priorities rather than moving on to number two from the original list. [ask] “What must be done now?” This generally results in new and different priorities."
"asked [your]self which of the two or three tasks at the top of the list [you yourself are] best suited to undertake. [concentrate] on that task" and delegate the others.
"...do not ask if it’s right for the owners, the stock price, the employees, or the executives...a decision that isn’t right for the enterprise will ultimately not be right for any of the stakeholders."
"This ... is especially important for executives at family owned or family run businesses... In the successful family company, a relative is promoted only if he or she is measurably superior to all nonrelatives on the same level." (although family members may be preferentially hired into entry-level positions)
"Executives are doers; they execute"
"...think about desired results, probable restraints, future revisions, check-in points, and implications for how [you’ll] spend [your] time. "
“What contributions should the enterprise expect from me over the next 18 months to two years? What results will I commit to? With what deadlines?” Then [consider] the restraints on action: “Is this course of action ethical? Is it acceptable within the organization? Is it legal? Is it compatible with the mission, values, and policies of the organization?”
"The action plan is a statement of intentions rather than a commitment. It must not become a straitjacket. It should be revised often, because every success creates new opportunities. So does every failure. The same is true for changes in the business environment, in the market, and especially in people within the enterprise..."
" the action plan needs to create a system for checking the results against the expectations. Effective executives usually build two such checks into their action plans. The first check comes halfway through the plan’s time period; for example, at nine months. The second occurs at the end, before the next action plan is drawn up.
Finally, the action plan has to become the basis for the executive’s time management. Time is an executive’s scarcest and most precious resource. And organizations—whether government agencies, businesses, or nonprofits—are inherently time wasters. The action plan will prove useless unless it’s allowed to determine how the executive spends his or her time. Napoleon allegedly said that no successful battle ever followed its plan. Yet Napoleon also planned every one of his battles, far more meticulously than any earlier general had done. "
" A decision has not been made until people know:
An extraordinary number of organizational decisions run into trouble because these bases aren’t covered. One of my clients, 30 years ago, lost its leadership position in the fast-growing Japanese market because the company, after deciding to enter into a joint venture with a new Japanese partner, never made clear who was to inform the purchasing agents that the partner defined its specifications in meters and kilograms rather than feet and pounds—and nobody ever did relay that information. "
" It’s just as important to review decisions periodically—at a time that’s been agreed on in advance—as it is to make them carefully in the first place. That way, a poor decision can be corrected before it does real damage. These reviews can cover anything from the results to the assumptions underlying the decision. "
" A systematic decision review can be a powerful tool for self-development, too. Checking the results of a decision against its expectations shows executives what their strengths are, where they need to improve, and where they lack knowledge or information ... [particularly the areas in which they are simply incompetent]. "
"In areas [in which executives are simply incompetent], smart executives don’t make decisions or take actions. They delegate."
" Such a review is especially important for the most crucial and most difficult of all decisions, the ones about hiring or promoting people. Studies of decisions about people show that only one-third of such choices turn out to be truly successful. One-third are likely to be draws—neither successes nor outright failures. And one-third are failures, pure and simple. Effective executives know this and check up (six to nine months later) on the results of their people decisions. If they find that a decision has not had the desired results, they don’t conclude that the person has not performed. They conclude, instead, that they themselves made a mistake. "
" Executives also owe it to the organization and to their fellow workers not to tolerate nonperforming individuals in important jobs. It may not be the employees’ fault that they are underperforming, but even so, they have to be removed."
" People who have failed in a new job should be given the choice to go back to a job at their former level and salary. This option is rarely exercised; such people, as a rule, leave voluntarily, at least when their employers are U.S. firms. But the very existence of the option can have a powerful effect, encouraging people to leave safe, comfortable jobs and take risky new assignments. "
" Most discussions of decision making assume that only senior executives make decisions or that only senior executives’ decisions matter. This is a dangerous mistake. Decisions are made at every level of the organization... " "
"...share their plans with and ask for comments from all [your] colleagues—superiors, subordinates, and peers."
" let each person know what information they’ll need to get the job done. The information flow from subordinate to boss is usually what gets the most attention. But executives need to pay equal attention to peers’ and superiors’ information needs.
We all know, thanks to Chester Barnard’s 1938 classic The Functions of the Executive, that organizations are held together by information rather than by ownership or command. Still, far too many executives behave as if information and its flow were the job of the information specialist—for example, the accountant. As a result, they get an enormous amount of data they do not need and cannot use, but little of the information they do need. The best way around this problem is for each executive to identify the information he needs, ask for it, and keep pushing until he gets it. "
"...problem solving, however necessary, does not produce results. It prevents damage. Exploiting opportunities produces results.
Above all, effective executives treat change as an opportunity rather than a threat. "
" make sure that problems do not overwhelm opportunities. In most companies, the first page of the monthly management report lists key problems. It’s far wiser to list opportunities on the first page and leave problems for the second page. Unless there is a true catastrophe, problems are not discussed in management meetings until opportunities have been analyzed and properly dealt with.
Staffing is another important aspect of being opportunity focused. Effective executives put their best people on opportunities rather than on problems. One way to staff for opportunities is to 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. In Japan, by the way, this match-up is considered a major HR task in a big corporation or government department; that practice is one of the key strengths of Japanese business "
" very study of the executive workday has found that even junior executives and professionals are with other people—that is, in a meeting of some sort—more than half of every business day. The only exceptions are a few senior researchers. Even a conversation with only one other person is a meeting. Hence, if they are to be effective, executives must make meetings productive. They must make sure that meetings are work sessions rather than bull sessions.
The key to running an effective meeting is to decide in advance what kind of meeting it will be. Different kinds of meetings require different forms of preparation and different results:
A meeting to prepare a statement, an announcement, or a press release. For this to be productive, one member has to prepare a draft beforehand. At the meeting’s end, a preappointed member has to take responsibility for disseminating the final text.
A meeting to make an announcement—for example, an organizational change. This meeting should be confined to the announcement and a discussion about it.
A meeting in which one member reports. Nothing but the report should be discussed.
A meeting in which several or all members report. Either there should be no discussion at all or the discussion should be limited to questions for clarification. Alternatively, for each report there could be a short discussion in which all participants may ask questions. If this is the format, the reports should be distributed to all participants well before the meeting. At this kind of meeting, each report should be limited to a preset time—for example, 15 minutes.
A meeting to inform the convening executive. The executive should listen and ask questions. He or she should sum up but not make a presentation.
A meeting whose only function is to allow the participants to be in the executive’s presence. Cardinal Spellman’s breakfast and dinner meetings were of that kind. There is no way to make these meetings productive. They are the penalties of rank. Senior executives are effective to the extent to which they can prevent such meetings from encroaching on their workdays. Spellman, for instance, was effective in large part because he confined such meetings to breakfast and dinner and kept the rest of his working day free of them.
Making a meeting productive takes a good deal of self-discipline. It requires that executives determine what kind of meeting is appropriate and then stick to that format. It’s also necessary to terminate the meeting as soon as its specific purpose has been accomplished. Good executives don’t raise another matter for discussion. They sum up and adjourn.
Good follow-up is just as important as the meeting itself. The great master of follow-up was Alfred Sloan, the most effective business executive I have ever known. Sloan, who headed General Motors from the 1920s until the 1950s, spent most of his six working days a week in meetings—three days a week in formal committee meetings with a set membership, the other three days in ad hoc meetings with individual GM executives or with a small group of executives. At the beginning of a formal meeting, Sloan announced the meeting’s purpose. He then listened. He never took notes and he rarely spoke except to clarify a confusing point. At the end he summed up, thanked the participants, and left. Then he immediately wrote a short memo addressed to one attendee of the meeting. In that note, he summarized the discussion and its conclusions and spelled out any work assignment decided upon in the meeting (including a decision to hold another meeting on the subject or to study an issue). He specified the deadline and the executive who was to be accountable for the assignment. He sent a copy of the memo to everyone who’d been present at the meeting. It was through these memos—each a small masterpiece—that Sloan made himself into an outstandingly effective executive.
The final practice is this: Don’t think or say “I.” Think and say “we.” Effective executives know that they have ultimate responsibility, which can be neither shared nor delegated. But they have authority only because they have the trust of the organization. This means that they think of the needs and the opportunities of the organization before they think of their own needs and opportunities. This one may sound simple; it isn’t, but it needs to be strictly observed.
effectiveness := the job of the executive := to get the right things done
"...men of high effectiveness are conspicuous by their absence in executive jobs. High intelligence is common enough among executives. Imagination is far from rare. The level of knowledge tends to be high. But there seems to be little correlation between a man's effectiveness and his intelligence, his imagination or his knowledge"
(irrelevant but interesting: he hypothesizes that there used to be very few jobs requiring executives, so it used to be sufficient to rely on the exceedingly rare 'naturals'; i don't agree) " Formerly, the manual worker-whether machine operator or front-line soldier-predominated in an organizations. Few people of effectiveness were needed: those at the top who gave the orders that others carried out. They were so small a fraction of the total work population that we could, rightly or wrongly, take their effectiveness for granted. We could depend on the supply of "naturals," the few people in any area of human endeavor who somehow know what the rest of us have to learn the hard way.
This was true not only of business and the army. It is hard to realize today that "government" during the American Civil War a hundred years ago meant the merest handful of people. Lincoln's Secretary of War had fewer than fifty civilian subordinates, most of them not "executives' and policy-makers but telegraph clerks. The entire Washington establishment of the U.S. government in Theodore Roosevelt's time, around 1900, could be comfortably housed in any one of the government buildings along the Mall today. "
any knowledge worker is an "executive" the way he uses the term in this book; "WHO IS AN EXECUTIVE?
Every knowledge worker in modern organization is an “executive” if, by virtue of his position or knowledge, he is responsible for a contribution that materially affects the capacity of the organization to perform and to obtain results,"
the need for "effectiveness" skills (i would just say "executive" skills) is that you may be able to measure how much work someone does, but you cannot measure how good they are at choosing the RIGHT things to get done.
" The knowledge worker cannot be supervised closely or in detail. He can only be helped. But he must direct himself, and he must direct himself toward performance and contribution, that is, toward effectiveness.
One can indeed never be sure what the knowledge worker thinks—and yet thinking is his specific work; it is his “doing.” "
" The motivation of the knowledge worker depends on his being effective, on his being able to achieve. If effectiveness is lacking in his or her work, his commitment to work and to contribution will soon wither, and he will become a time-server going through the motions from 9-5. "
" There seems to be very little any one executive can do about it. He cannot, as a rule, like the physician, stick his head out the door and say to the nurse, “I won’t see anybody for the next half hour.” Just at this moment, the executive’s telephone rings, and he has to speak to the company’s best customer or to a high official in the city administration or to his boss— and the next half hour is already gone....This comes out clearly in Sune Carlson’s Executive Behavior (Stockholm, Strombergs, 1951), the one study of top management in large corporations which actually recorded the time-use of senior executives. Even the most effective executives in Professor Carlson’s study found most of their time taken up with the demands of others and for purposes which added little if anything to their effectiveness. In fact, executives might well be defined as people who normally have no time of their own, because their time is always pre-empted by matters of importance to somebody else. "
"...the complaint is common that the company president -- or any other senior officer -- still continues to run marketing or the plant, even though he is now in charge of the whole business and should be giving his time to its direction.
The fundamental problem is the reality around the executive. Unless he changes it by deliberate action, the flow of events will determine what he is concerned with and what he does....events rarely tell the executive anything, let alone the real problem.... What events are important and relevant and what events are merely distractions the events themselves do not indicate. They are not even symptoms in the sense in which the patient’s narrative is a clue for the physician.
If the executive lets the flow of events determine what he does, what he works on, and what he takes seriously, he will fritter himself away “operating.” He may be an excellent man. But he is certain to waste his knowledge and ability and to throw away what little effectiveness he might have achieved. What the executive needs are criteria which enable him to work on the truly important, that is, on contributions and results, even though the criteria are not found in the flow of events. "
"Usually the people who are most important to the effectiveness of an executive are not people over whom he has direct control. They are people in other areas, people who in terms of organization, are “sideways.” Or they are his superiors. Unless the executive can reach these people, can make his contribution effective for them and in their work, he has no effectiveness at all. "
"Every executive... sees the inside—the organization—as close and immediate reality. He sees the outside only through thick and distorting lenses, if at all. What goes on outside is usually not even known firsthand. It is received through an organizational filter of reports, that is, in an already predigested and highly abstract form that imposes organizational criteria of relevance on the outside reality. ... Specifically, there are no results within the organization. All the results are on the outside. The only business results, for instance, are produced by a customer who converts the costs and efforts of the business into revenues and profits through his willingness to exchange his purchasing power...the decision-maker is outside rather than inside the business. .... What happens inside any organization is effort and cost. To speak of “profit centers” in a business as we are wont to do is polite euphemism. There are only effort centers. The less an organization has to do to produce results, the better it does its job. "
" An organization, a social artifact, is very different from a biological organism. Yet it stands under the law that governs the structure and size of animals and plants: The surface goes up with the square of the radius, but the mass grows with the cube. The larger the animal becomes, the more resources have to be devoted to the mass and to the internal tasks, to circulation and information, to the nervous system, and so on.
Every part of an amoeba is in constant, direct contact with the environment. It therefore needs no special organs to perceive its environment or to hold it together. But a large and complex animal such as man needs a skeleton to hold it together. It needs all kinds of specialized organs for ingestion and digestion, for respiration and exhalation, for carrying oxygen to the tissues, for reproduction, and so on. Above all, a man needs a brain and a number of complex nervous systems. Most of the mass of the amoeba is directly concerned with survival and procreation. Most of the mass of the higher animal—its resources, its food, its energy supply, its tissues—serve to overcome and offset the complexity of the structure and the isolation from the outside. "
"The patient who walks into his office brings with him everything to make the physician’s knowledge effective. During the time he is with the patient, the doctor can, as a rule, devote himself to the patient. He can keep interruptions to a minimum. The contribution the physician is expected to make is clear. What is important, and what is not, is determined by whatever ails the patient. The patient’s complaints establish the doctor’s priorities. And the goal, the objective, is given: It is to restore the patient to health or at least to make him more comfortable. Physicians are not noted for their capacity to organize themselves and their work. But few of them have much trouble being effective. ... an executive cannot, as a rule, like the physician, stick his head out the door and say to the nurse, “I won’t see anybody for the next half hour.” ...
Depending on the flow of events is appropriate for the physician. The doctor who looks up when a patient comes in and says: “Why are you here today?” expects the patient to tell him what is relevant. When the patient says, “Doctor, I can’t sleep. I haven’t been able to go to sleep the last three weeks,” he is telling the doctor what the priority area is. Even if the doctor decides, upon closer examination, that the sleeplessness is a fairly minor symptom of a much more fundamental condition he will do something to help the patient to get a few good nights’ rest.
But events rarely tell the executive anything, let alone the real problem. For the doctor, the patient’s complaint is central because it is central to the patient. The executive is concerned with a much more complex universe. What events are important and relevant and what events are merely distractions the events themselves do not indicate. They are not even symptoms in the sense in which the patient’s narrative is a clue for the physician.
"
This danger is being aggravated today by the advent of the computer and of the new information technology. The computer, being a mechanical moron, can handle only quantifiable data.... The relevant outside events are rarely available in quantifiable form until it is much too late to do anything about them. .... The problem is rather that the important and relevant outside events are often qualitative and not capable of quantification. .... The thalidomide tragedy which led to the birth of so many deformed babies is a case in point. By the time doctors on the European continent had enough statistics to realize that the number of deformed babies born was significantly larger than normal—so much larger that there had to be a specific and new cause—the damage had been done. In the United States, the damage was prevented because one public health physician perceived a qualitative change—a minor and by itself meaningless skin tingling caused by the drug—related it to a totally different event that had happened many years earlier, and sounded the alarm before thalidomide actually came into use.
The Ford Edsel holds a similar lesson. All the quantitative figures that could possibly be obtained were gathered before the Edsel was launched. All of them pointed to its being the right car for the right market. The qualitative change—the shifting of American consumer-buying of automobiles from income-determined to taste-determined market-segmentation—no statistical study could possibly have shown. By the time this could be captured in numbers, it was too late—the Edsel had been brought out and had failed.
The truly important events on the outside are not the trends. They are changes in the trends. These determine ultimately success or failure of an organization and its efforts. Such changes, however, have to be perceived; they cannot be counted, defined, or classified. The classifications still produce the expected figures—as they did for Edsel. But the figures no longer correspond to actual behavior. ... The danger is that executives will become contemptuous of information and stimulus that cannot be reduced to computer logic and computer language. Executives may become blind to everything that is perception (i.e., event) rather than fact (i.e., after the event). "
" Increasing effectiveness may well be the only area where we can hope significantly to raise the level of executive performance, achievement, and satisfaction.
We certainly could use people of much greater abilities in many places. We could use people of broader knowledge. I submit, however, that in these two areas, not too much can be expected from further efforts. We may be getting to the point where we are already attempting to do the inherently impossible or at least the inherently unprofitable. But we are not going to breed a new race of supermen. We will have to run our organizations with men as they are.
The books on manager development, for instance, envisage truly a “man for all seasons” in their picture of “the manager of tomorrow.” A senior executive, we are told, should have extraordinary abilities as an analyst and as a decision-maker. He should be good at working with people and at understanding organization and power relations, be good at mathematics, and have artistic insights and creative imagination. What seems to be wanted is universal genius, and universal genius has always been in scarce supply. The experience of the human race indicates strongly that the only person in abundant supply is the universal incompetent. We will therefore have to staff our organizations with people who at best excel in one of these abilities. And then they are more than likely to lack any but the most modest endowment in the others.
We will have to learn to build organizations in such a manner that any man who has strength in one important area is capable of putting it to work (as will be discussed in considerable depth in Chapter 4 below). But we cannot expect to get the executive performance we need by raising our standards for abilities, let alone by hoping for the universally gifted man. We will have to extend the range of human beings through the tools they have to work with rather than through a sudden quantum jump in human ability.
The same, more or less, applies to knowledge. However badly we may need people of more and better knowledge, the effort needed to make the major improvement may well be greater than any possible, let alone any probable, return.
• Fifteen years ago when “operations research” first came in, several of the brilliant young practitioners published their prescription for the operations researcher of tomorrow. They always came out asking for a polymath knowing everything and capable of doing superior and original work in every area of human knowledge. According to one of these studies, operations researchers need to have advanced knowledge in sixty-two or so major scientific and humanistic disciplines. If such a man could be found, he would, I am afraid, be totally wasted on studies of inventory levels or on the programing of production schedules.
Much less ambitious programs for manager development call for high knowledge in such a host of divergent skills as accounting and personnel, marketing, pricing and economic analysis, the behavioral sciences such as psychology, and the natural sciences from physics to biology and geology. And we surely need men who understand the dynamics of modern technology, the complexity of the modern world economy, and the labyrinth of modern government.
Every one of these is a big area, is indeed, too big even for men who work on nothing else. The scholars tend to specialize in fairly small segments of each of these fields and do not pretend to have more than a journeyman’s knowledge of the field itself.
I am not saying that one need not try to understand the fundamentals of every one of these areas.
• One of the weaknesses of young, highly educated people today—whether in business, medicine, or government—is that they are satisfied to be versed in one narrow specialty and affect a contempt for the other areas. One need not know in detail what to do with “human relations” as an accountant, or how to promote a new branded product if an engineer. But one has a responsibility to know at least what these areas are about, why they are around, and what they are trying to do. One need not know psychiatry to be a good urologist. But one had better know what psychiatry is all about. One need not be an international lawyer to do a good job in the Department of Agriculture. But one had better know enough about international politics not to do international damage through a parochial farm policy.
This, however, is something very different from the universal expert, who is as unlikely to occur as the universal genius. Instead we will have to learn how to make better use of people who are good in any one of these areas. But this means increasing effectiveness. If one cannot increase the supply of a resource, one must increase its yield. And effectiveness is the one tool to make the resources of ability and knowledge yield more and better results. "
" there is no “effective personality.”* The effective executives I have seen differ widely in their temperaments and their abilities, in what they do and how they do it, in their personalities, their knowledge, their interests—in fact in almost everything that distinguishes human beings. All they have in common is the ability to get the right things done.
Among the effective executives I have known and worked with, there are extroverts and aloof, retiring men, some even morbidly shy. Some are eccentrics, others painfully correct conformists. Some are fat and some are lean. Some are worriers, some are relaxed. Some drink quite heavily, others are total abstainers. Some are men of great charm and warmth, some have no more personality than a frozen mackerel. There are a few men among them who would answer to the popular conception of a “leader.” But equally there are colorless men who would attract no attention in a crowd. Some are scholars and serious students, others almost unlettered. Some have broad interests, others know nothing except their own narrow area and care for little else. Some of the men are self-centered, if not indeed selfish. But there are also some who are generous of heart and mind. There are men who live only for their work and others whose main interests lie outside—in community work, in their church, in the study of Chinese poetry, or in modern music. Among the effective executives I have met, there are people who use logic and analysis and others who rely mainly on perception and intuition. There are men who make decisions easily and men who suffer agonies every time they have to move.
Effective executives, in other words, differ as widely as physicians, high-school teachers, or violinists. They differ as widely as do ineffectual ones, are indeed indistinguishable from ineffectual executives in type, personality, and talents.
What all these effective executives have in common is the practices that make effective whatever they have and whatever they are. And these practices are the same, whether the effective executive works in a business or in a government agency, as hospital administrator, or as university dean.
But whenever I have found a man, no matter how great his intelligence, his industry, his imagination, or his knowledge, who fails to observe these practices, I have also found an executive deficient in effectiveness.
Effectiveness, in other words, is a habit; that is, a complex of practices. And practices can always be learned. Practices are simple, deceptively so; even a seven-year-old has no difficulty in understanding a practice. But practices are always exceedingly hard to do well. They have to be acquired, as we all learn the multiplication table; that is, repeated ad nauseam until “6 x 6 = 36” has become unthinking, conditioned reflex, and firmly ingrained habit. Practices one learns by practicing and practicing and practicing again. "
" 1. Effective executives know where their time goes. They work systematically at managing the little of their time that can be brought under their control.
2. Effective executives focus on outward contribution. They gear their efforts to results rather than to work. They start out with the question, “What results are expected of me?” rather than with the work to be done, let alone with its techniques and tools.
3. Effective executives build on strengths—their own strengths, the strengths of their superiors, colleagues, and subordinates; and on the strengths in the situation, that is, on what they can do. They do not build on weakness. They do not start out with the things they cannot do.
4. Effective executives concentrate on the few major areas where superior performance will produce outstanding results. They force themselves to set priorities and stay with their priority decisions. They know that they have no choice but to do first things first—and second things not at all. The alternative is to get nothing done.
5. Effective executives, finally, make effective decisions. They know that this is, above all, a matter of system—of the right steps in the right sequence. They know that an effective decision is always a judgment based on “dissenting opinions” rather than on “consensus on the facts.” And they know that to make many decisions fast means to make the wrong decisions. What is needed are few, but fundamental, decisions. What is needed is the right strategy rather than razzle-dazzle tactics. "
" Most discussions of the executive’s task start with the advice to plan one’s work. This sounds eminently plausible. The only thing wrong with it is that it rarely works. The plans always remain on paper, always remain good intentions. They seldom turn into achievement.
Effective executives, in my observation, do not start with their tasks. They start with their time. And 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 to cut back unproductive demands on their time. Finally they consolidate their “discretionary” time into the largest possible continuing units. This three-step process:
• recording time,
• managing time, and
• consolidating time is the foundation of executive effectiveness. "
time is important because it is often the limiting factor (every action requires some amount of time as an input), it is scarces than the supply of money or people, and the supply is totally inelastic.
"If we rely on our memory...we do not know how time has been spent.
I sometimes ask executives who pride themselves on their memory to put down their guess as to how they spend their own time. Then I lock these guesses away for a few weeks or months. In the meantime, the executives run an actual time record on themselves. There is never much resemblance between the way these men thought they used their time and their actual records. "
So record how you spend your time.
some examples are: ceremony, relationships with important customers, govenment officials, subordinates, peers, superiors.
many tasks require a lot of time at once to do well. e.g. writing the first draft of a document, talking to another person.
supervising knowledge workers: " One can say to a manual worker, “our work standard calls for fifty pieces an hour, and you are only turning out forty-two.” One has to sit down with a knowledge worker and think through with him what should be done and why, before one can even know whether he is doing a satisfactory job or not. And this is time-consuming.
Since the knowledge worker directs himself, he must understand what achievement is expected of him and why. He must also understand the work of the people who have to use his knowledge output. For this, he needs a good deal of information, discussion, instruction—all things that take time. And contrary to common belief, this time demand is made not only on his superior but equally on his colleagues. "
" Since the knowledge worker directs himself, he must understand what achievement is expected of him and why. He must also understand the work of the people who have to use his knowledge output.... Wherever knowledge workers perform well in large organizations, senior executives take time out, on a regular schedule, to sit down with them, sometimes all the way down to green juniors, and 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? And, all together, what do you want to know from me about the organization?”
This leisurely exchange is needed equally in a government agency and in a business, in a research lab and in an army staff. Without it, the knowledge people either lose enthusiasm and become time-servers, or they direct their energies toward their specialty and away from the opportunities and needs of the organization. But such a session takes a great deal of time, especially as it should be unhurried and relaxed. People must feel that “we have all the time in the world.” This actually means that one gets a great deal done fast. But it means also that one has to make available a good deal of time in one chunk and without too much interruption.
Mixing personal relations and work relations is time-consuming. If hurried, it turns into friction. Yet any organization rests on this mixture. The more people are together, the more time will their sheer interaction take, the less time will be available to them for work, accomplishment, and results. "
" Management literature has long known the theorem of “the span of control,” which asserts that one man can manage only a few people if these people have to come together in their own work (that is, for instance, an accountant, a sales manager, and a manufacturing man, all three of whom have to work with each other to get any results). On the other hand, managers of chain stores in different cities do not have to work with each other, so that any number could conceivably report to one regional vice-president without violating the principle of the “span of control.” Whether this theorem is valid or not, there is little doubt that the more people have to work together, the more time will be spent on “interacting” rather than on work and accomplishment. Large organization creates strength by lavishly using the executive’s time.
The larger the organization, therefore, the less actual time will the executive have. The more important will it be for him to know where his time goes and to manage the little time at his disposal. "
" The more people there are in an organization, the more often does a decision on people arise. But fast personnel decisions are likely to be wrong decisions. The time quantum of the good personnel decision is amazingly large. What the decision involves often becomes clear only when one has gone around the same track several times.
Among the effective executives I have had occasion to observe, there have been people who make decisions fast, and people who make them rather slowly. But without exception, they make personnel decisions slowly and they make them several times before they really commit themselves.
• Alfred P. Sloan, Jr., former head of General Motors, the world’s largest manufacturing company, was reported never to make a personnel decision the first time it came up. He made a tentative judgment, and even that took several hours as a rule. Then, a few days or weeks later, he tackled the question again, as if he had never worked on it before. Only when he came up with the same name two or three times in a row was he willing to go ahead. Sloan had a deserved reputation for the “winners” he picked. But when asked about his secret, he is reported to have said: “No secret—I have simply accepted that the first name I come up with is likely to be the wrong name—and I therefore retrace the whole process of thought and analysis a few times before I act.” Yet Sloan was far from a patient man.
Few executives make personnel decisions of such impact. But all effective executives I have had occasion to observe have learned that they have to give several hours of continuous and uninterrupted thought to decisions on people if they hope to come up with the right answer.
• The director of a medium-sized government research institute found this out when one of his senior administrators had to be removed from his job. The man was in his fifties and had been with the institute all his working life. After years of good work, the man suddenly began to deteriorate. He clearly could no longer handle his job. But even if civil service rules had permitted it, the man could not be fired. He could of course have been demoted. But this, the director felt, would destroy the man—and the institute owed him consideration and loyalty for years of productive, loyal service. Yet he could not be kept in an administrative position; his shortcomings were much too obvious and were, indeed, weakening the whole institute.
The director and his deputy had been over this situation many times without seeing a way out. But when they sat down for a quiet evening where they could give three or four hours uninterruptedly to the problem, the “obvious” solution finally emerged. It was indeed so simple that neither could explain why he had not seen it before. It got the man out of the wrong job into a job which needed being done and which yet did not require the administrative performance he was no longer able to give.
Time in large, continuous, and uninterrupted units is needed for such decisions as whom to put on a task force set up to study a specific problem; what responsibilities to entrust to the manager of a new organizational unit or to the new manager of an old organizational unit; whether to promote into a vacancy a man who has the marketing knowledge needed for the job but lacks technical training, or whether to put in a first-rate technical man without much marketing background, and so on.
People-decisions are time-consuming, for the simple reason that the Lord did not create people as “resources” for organization. They do not come in the proper size and shape for the tasks that have to be done in organization—and they cannot be machined down or recast for these tasks. People are always “almost fits” at best. To get the work done with people (and no other resource is available) therefore requires lots of time, thought, and judgment. "
" a high standard of living presupposes an economy of innovation and change. But innovation and change make inordinate time demands on the executive. All one can think and do in a short time is to think what one already knows and to do as one has always done.
• There has been an enormous amount of discussion lately to explain why the British economy has lagged so badly since World War II. One of the reasons is surely that the British businessman of the older generation tried to have it as easy as his workers and to work the same short hours. But this is possible only if the business or the industry clings to the old established routine and shuns innovation and change. "
(bayle: note that this increase is unsustainable, as there are only so many hours in the day. This is one basis for my hypothesis that societal change will not increase exponentially, but only polynomially (linearly if a faster rate of change linearly increased the hours-per-day that executies would have to work, because eventually that would max out; but mb tools can make up for that a little, and we'll get something quadratic, or in between linear and quadratic, or some other power).
" A good many effective executives keep such a log continuously and look at it regularly every month. At a minimum, effective executives have the log run on themselves for three to four weeks at a stretch twice a year or so, on a regular schedule. After each such sample, they rethink and rework their schedule. But six months later, they invariably find that they have “drifted” into wasting their time on trivia. Time-use does improve with practice. But only constant efforts at managing time can prevent drifting. "
"1. First one tries to identify and eliminate the things that need not be done at all, the things that are purely waste of time without any results whatever. To find these time-wastes, one asks of all activities in the time records: “What would happen if this were not done at all?” And if the answer is, “Nothing would happen,” then obviously the conclusion is to stop doing it. ... example:
"• The chief executive mentioned above who had to dine out every night found, when he analyzed these dinners, that at least one third would proceed just as well without anyone from the company’s senior management. In fact, he found (somewhat to his chagrin) that his acceptance of a good many of these invitations was by no means welcome to his hosts. They had invited him as a polite gesture. But they had fully expected to be turned down and did not quite know what to do with him when he accepted. "
"
I have yet to see an executive, regardless of rank or station, who could not consign something like a quarter of the demands on his time to the wastepaper basket without anybody’s noticing their disappearance. "
"2. The next question is: “Which of the activities on my time log could be done by somebody else just as well, if not better?” ... There has been for years a great deal of talk about “delegation” in management....As usually presented, delegation makes little sense. If it means that somebody else ought to do part of “my work,” it is wrong. One is paid for doing one’s own work. And if it implies, as the usual sermon does, that the laziest manager is the best manager, it is not only nonsense; it is immoral.
But I have never seen an executive confronted with his time record who did not rapidly acquire the habit of pushing at other people everything that he need not do personally. The first look at the time record makes it abundantly clear that there just is not time enough to do the things the executive himself considers important, himself wants to do, and is himself committed to doing. The only way he can get to the important things is by pushing on others anything that can be done by them at all. "
examples of things to look at: " A good example is executive travel. ... There are also the meetings one attends, even though nothing is going to happen that someone else could not handle There are the hours spent discussing a document before there is even a first draft that can be discussed. There is, in the research lab, the time spent by a senior physicist to write a “popular” news release on some of his work "
" There is no one symptom for this. But there is still a simple way to find out. That is to ask other people. Effective executives have learned to ask systematically and without coyness: “What do I do that wastes your time without contributing to your effectiveness?” To ask this question, and to ask it without being afraid of the truth, is a mark of the effective executive. "
Example: status meetings:
" The manner in which an executive does productive work may still be a major waste of somebody’s else’s time.
• The senior financial executive of a large organization knew perfectly well that the meetings in his office wasted a lot of time. This man asked all his direct subordinates to every meeting, whatever the topic. As a result the meetings were far too large. And because every participant felt that he had to show interest, everybody asked at least one question — most of them irrelevant. As a result the meetings stretched on endlessly. But the senior executive had not known, until he asked, that his subordinates too considered the meetings a waste of their time. Aware of the great importance everyone in the organization placed on status and on being “in the know,” he had feared that the uninvited men would feel slighted and left out.
Now, however, he satisfies the status needs of his subordinates in a different manner. He sends out a printed form which reads: “I have asked [Messrs Smith, Jones, and Robinson] to meet with me [Wednesday at 3] in [the fourth floor conference room] to discuss budget. Please come if you think that you need the information or want to take part in the discussion. But you will in any event receive right away a full summary of the discussion and of any decisions reached, together with a request for your comments.”
Where formerly a dozen people came and stayed all afternoon, three men and a secretary to take the notes now get the matter over with within an hour or so. And no one feels left out. "
" Many executives know all about these unproductive and unnecessary time demands; yet they are afraid to prune them. They are afraid to cut out something important by mistake. But this mistake, if made, can be speedily corrected. If one prunes too harshly, one usually finds out fast enough.
Every new President of the United States accepts too many invitations at first. Then it dawns on him that he has other work to do and that most of these invitations do not add to his effectiveness. Thereupon, he usually cuts back too sharply and becomes inaccessible. A few weeks or months later, however, he is being told by the press and the radio that he is “losing touch.” Then he usually finds the right balance between being exploited without effectiveness and using public appearances as his national pulpit.
In fact, there is not much risk that an executive will cut back too much. We usually tend to overrate rather than underrate our importance and to conclude that far too many things can only be done by ourselves. Even very effective executives still do a great many unnecessary, unproductive things.
But the best proof that the danger of overpruning is a bugaboo is the extraordinary effectiveness so often attained by severely ill or severely handicapped people. "
" identify the time-wasters which follow from lack of system or foresight. The symptom to look for is the recurrent “crisis,” the crisis that comes back year after year. A crisis that recurs a second time is a crisis that must not occur again.
• The annual inventory crisis belongs here. That with the computer we now can meet it even more “heroically” and at greater expense than we could in the past is hardly a great improvement.
A recurrent crisis should always have been foreseen. It can therefore either be prevented or reduced to a routine which clerks can manage. The definition of a “routine” is that it makes unskilled people without judgment capable of doing what it took near-genius to do before; for a routine puts down in systematic, step-by-step form what a very able man learned in surmounting yesterday’s crisis.
....
The recurrent crisis is simply a symptom of slovenliness and laziness.
• Years ago when I first started out as a consultant, I had to learn how to tell a well-managed industrial plant from a poorly managed one—without any pretense to production knowledge. A well-managed plant, I soon learned, is a quiet place. A factory that is “dramatic,” a factory in which the “epic of industry” is unfolded before the visitor’s eyes, is poorly managed. A well-managed factory is boring. Nothing exciting happens in it because the crises have been anticipated and have been converted into routine.
Similarly a well-managed organization is a “dull” organization. The “dramatic” things in such an organization are basic decisions that make the future, rather than heroics in mopping up yesterday. "
"
• My first-grade arithmetic primer asked: “If it takes two ditch-diggers two days to dig a ditch, how long would it take four ditch-diggers?” In first grade, the correct answer is, of course, “one day.” In the kind of work, however, with which executives are concerned, the right answer is probably “four days” if not “forever.” A work force may, indeed, be too small for the task. And the work then suffers, if it gets done at all. But this is not the rule. Much more common is the work force that is too big for effectiveness, the work force that spends, therefore, an increasing amount of its time “interacting” rather than working.
There is a fairly reliable symptom of overstaffing. If the senior people in the group—and of course the manager in particular—spend more than a small fraction of their time, maybe one tenth, on “problems of human relations,” on feuds and frictions, on jurisdictional disputes and questions of cooperation, and so on, then the work force is almost certainly too large. "
" The excuse for overstaffing is always “but we have to have a thermodynamicist [or a patent lawyer, or an economist] on the staff.” This specialist is not being used much; he may not be used at all; but “we have to have him around just in case we need him.” (And he always “has to be familiar with our problem” and “be part of the group from the start”!) One should only have on a team the knowledges and skills that are needed day in and day out for the bulk of the work. Specialists that may be needed once in a while, or that may have to be consulted on this or on that, should always remain outside. "
" Its symptom is an excess of meetings. ... In an ideally designed structure (which in a changing world is of course only a dream) there would be no meetings. Everybody would know what he needs to know to do his job. Everyone would have the resources available to him to do his job. We meet because people holding different jobs have to cooperate to get a specific task done. We meet because the knowledge and experience needed in a specific situation are not available in one head, but have to be pieced together out of the experience and knowledge of several people. ...if executives in an organization spend more than a fairly small part of their time in meeting, it is a sure sign of malorganization.
Every meeting generates a host of little follow-up meetings —some formal, some informal, but both stretching out for hours. Meetings, therefore, need to be purposefully directed. An undirected meeting is not just a nuisance; it is a danger. But above all, meetings have to be the exception rather than the rule. An organization in which everybody meets all the time is an organization in which no one gets anything done. Wherever a time log shows the fatty degeneration of meetings—whenever, for instance, people in an organization find themselves in meetings a quarter of their time or more—there is time-wasting malorganization.
• There are exceptions, special organs whose purpose it is to meet—the boards of directors, for instance, of such companies as Du Pont and Standard Oil of New Jersey which are the final organs of deliberation and appeal but which do not operate anything. But as these two companies realized a long time ago, the people who sit on these boards cannot be permitted to do anything else; for the same reason, by the way, that judges cannot be permitted to be also advocates in their spare time.
As a rule, meetings should never be allowed to become the main demand on an executive’s time. Too many meetings always bespeak poor structure of jobs and the wrong organizational components. Too many meetings signify that work that should be in one job or in one component is spread over several jobs or several components. They signify that responsibility is diffused and that information is not addressed to the people who need it.
example: • In one large company, the root cause of an epidemic of meetings was a traditional but obsolescent organization of the energy business. Large steam turbines, the company’s traditional business since before 1900, were one division under their own management and with their own staff. During World War II, however, the company also went into aircraft engines and, as a result, had organized in another division concerned with aircraft and defense production a large jet engine capacity. Finally, there was an atomic energy division, really an offspring of the research labs and still organizationally more or less tied to them.
But today these three power sources are no longer separate, each with its own market. Increasingly, they are becoming substitutes for, as well as complements to, each other. Each of the three is the most economical and most advantageous generating equipment for electric power under certain conditions. In this sense the three are competitive. But by putting two of them together, one can also obtain performance capacities which no one type of equipment by itself possesses.
What the company needed, clearly, was an energy strategy. It needed a decision whether to push all three types of generating equipment, in competition with each other; whether to make one of the three the main business and consider the other two supplementary; or finally, whether to develop two of the three—and which two—as one “energy package.” It needed a decision how to divide available capital among the three. Above all, however, the energy business needed an organization which expressed the reality of one energy market, producing the same end product, electric power, for the same customers. Instead there were three components, each carefully shielded from the others by layers of organization, each having its own special folkways, rituals, and its own career ladders—and each blithely confident that it would get by itself 75 per cent of the total energy business of the next decade.
As a result, the three were engaged in a nonstop meeting for years. Since each reported to a different member of management, these meetings sucked in the entire top group. Finally, the three were cut loose from their original groups and put together into one organizational component under one manager. There is still a good deal of infighting going on; and the big strategy decisions still have to be made. But at least there is understanding now as to what these decisions are. At least top management no longer has to chair and referee every meeting. And total meeting-time is a fraction of what it used to be.
examples:
• The administrator of a large hospital was plagued for years by telephone calls from doctors asking him to find a bed for one of their patients who should be hospitalized. The admissions people “knew” that there was no empty bed. Yet the administrator almost invariably found a few. The admissions people simply were not informed immediately when a patient was discharged. The floor nurse knew, of course, and so did the people in the front office who presented the bill to the departing patient. The admissions people, however, got a “bed count” made every morning at 5:00 A.M.—while the great majority of patients were being sent home in midmorning after the doctors had made the rounds. It did not take genius to put this right; all it needed was an extra carbon copy of the chit that goes from the floor nurse to the front office.
Even worse, but equally common, is information in the wrong form.
• Manufacturing businesses typically suffer from production figures that have to be “translated” before operating people can use them. They report “averages”; that is, they report what the accountants need. Operating people, however, usually need not the averages but the range and the extremes — product mix and production fluctuations, length of runs, and so on. To get what they need, they must either spend hours each day adapting the averages or build their own “secret” accounting organization. The accountant has all the information, but no one, as a rule, has thought of telling him what is needed.
"
• One of the most accomplished time managers I have ever met was the president of a big bank with whom I worked for two years on top-management structure. I saw him once a month for two years. My appointment was always for an hour and a half. The president was always prepared for the sessions—and I soon learned to do my homework too. There was never more than one item on the agenda. But when I had been in there for an hour and twenty minutes, the president would turn to me and say, “Mr. Drucker, I believe you’d better sum up now and outline what we should do next.” And an hour and thirty minutes after I had been ushered into his office, he was at the door shaking my hand and saying good-by.
After this had been going on for about one year, I finally asked him, “Why always an hour and a half?” He answered, “That’s easy. I have found out that my attention span is about an hour and a half. If I work on any one topic longer than this, I begin to repeat myself. At the same time, I have learned that nothing of importance can really be tackled in much less time. One does not get to the point where one understands what one is talking about.”
During the hour and a half I was in his office every month, there was never a telephone call, and his secretary never stuck her head in the door to announce that an important man wanted to see him urgently. One day I asked him about this. He said, “My secretary has strict instructions not to put anyone through except the President of the United States and my wife. The President rarely calls—and my wife knows better. Everything else the secretary holds till I have finished. Then I have half an hour in which I return every call and make sure I get every message. I have yet to come across a crisis which could not wait ninety minutes.” Needless to say, this president accomplished more in this one monthly session than many other and equally able executives get done in a month of meetings.
But even this disciplined man had to resign himself to having at least half his time taken up by things of minor importance and dubious value, things that nonetheless had to be done—the seeing of important customers who just “dropped in,” attendance at meetings which could just as well have proceeded without him; specific decisions on daily problems that should not have reached him but invariably did.
Whenever I see a senior executive asserting that more than half his time is under his control and is really discretionary time which he invests and spends according to his own judgment, I am reasonably certain that he has no idea where his time goes.
Senior executives rarely have as much as one quarter of their time truly at their disposal and available for the important matters, the matters that contribute, the matters they are being paid for. This is true in any organization except that in the government agency the unproductive time demands on the top people tend to be even higher than they are in other large organizations.
The higher up an executive, the larger will be the proportion of time that is not under his control and yet not spent on contribution. The larger the organization, the more time will be needed just to keep the organization together and running, rather than to make it function and produce. "
" Even one quarter of the working day, if consolidated in large time units, is usually enough to get the important things done. But even three quarters of the working day are useless if they are only available as fifteen minutes here or half an hour there. .... There are a good many ways of doing this. Some people, usually senior men, work at home one day a week; this is a particularly common method of time-consolidation for editors or research scientists.
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.
• This was how the bank president handled his time. Monday and Friday he had his operating meetings, saw senior executives on current matters, was available to important customers, and so on. Tuesday, Wednesday, and Thursday afternoons were left unscheduled—for whatever might come up; and something of course always did, whether urgent personnel problems, a surprise visit by one of the bank’s representatives from abroad or by an important customer, or a trip to Washington. But in the mornings of these three days he scheduled the work on the major matters—in chunks of ninety minutes each.
Another fairly common method is to schedule a daily work period at home in the morning.
• One of the most effective executives in Professor Sune Carlson’s study, mentioned above, spent ninety minutes each morning before going to work in a study without telephone at home. Even if this means working very early so as to get to the office on time, it is preferable to the most popular way of getting to the important work: taking it home in the evening and spending three hours after dinner on it. By that time, most executives are too tired to do a good job. Certainly those of middle age or older are better off going to bed earlier and getting up earlier. And 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.
But the method by which one consolidates one’s discretionary time is far less important than the approach. Most people tackle the job by trying to push the secondary, the less productive matters together, thus clearing, so to speak, a free space between them. This does not lead very far, however. One still gives priority in one’s mind and in one’s schedule to the less important things, the things that have to be done even though they contribute little. As a result, any new time pressure is likely to be satisfied at the expense of the discretionary time and of the work that should be done in it. Within a few days or weeks, the entire discretionary time will then be gone again, nibbled away by new crises, new immediacies, new trivia.
Effective executives start out by estimating how much discretionary time they can realistically call their own. Then they set aside continuous time in the appropriate amount. And if they find later that other matters encroach on this reserve, they scrutinize their record again and get rid of some more time demands from less than fully productive activities. They know that, as has been said before, one rarely overprunes.
And all effective executives control their time management perpetually. They not only keep a continuing log and analyze it periodically. They set themselves deadlines for the important activities, based on their judgment of their discretionary time.
• One highly effective man I know keeps two such lists—one of the urgent and one of the unpleasant things that have to be done—each with a deadline. When he finds his deadlines slipping, he knows his time is again getting away from him. "
" The effective executive focuses on contribution. He looks up from his work and outward toward goals. He asks: “What can I contribute that will significantly affect the performance and the results of the institution I serve?” His stress is on responsibility. "
" The great majority of executives tend to focus downward. They are occupied with efforts rather than with results. They worry over what the organization and their superiors “owe” them and should do for them. And they are conscious above all of the authority they “should have.” As a result, they render themselves ineffectual.
• The head of one of the large management consulting firms always starts an assignment with a new client by spending a few days visiting the senior executives of the client organization one by one. After he has chatted with them about the assignment and the client organization, its history and its people, he asks (though rarely, of course, in these words): “And what do you do that justifies your being on the payroll?” The great majority, he reports, answer: “I run the accounting department,” or “I am in charge of the sales force.” Indeed, not uncommonly the answer is, “I have 850 people working under me.” Only a few say, “It’s my job to give our managers the information they need to make the right decisions,” or “I am responsible for finding out what products the customer will want tomorrow,” or “I have to think through and prepare the decisions the president will have to face tomorrow.”
The man who focuses on efforts and who stresses his downward authority is a subordinate no matter how exalted his title and rank. But the man who focuses on contribution and who takes responsibility for results, no matter how junior, is in the most literal sense of the phrase, “top management.” He holds himself accountable for the performance of the whole. "
" To ask, “What can I contribute?” is to look for the unused potential in the job. And what is considered excellent performance in a good many positions is often but a pale shadow of the job’s full potential of contribution. "
" ...every organization needs performance in three major areas: It needs direct results; building of values and their reaffirmation; and building and developing people for tomorrow. If deprived of performance in any one of these areas, it will decay and die. "
"
The direct results of an organization are clearly visible, as a rule. In a business, they are economic results such as sales and profits. In a hospital, they are patient care, and so on. But even direct results are not totally unambiguous...when there is confusion as to what they should be, there are no results.
Direct results always come first. In the care and feeding of an organization, they play the role calories play in the nutrition of the human body. But any organization also needs a commitment to values and their constant reaffirmation, as a human body needs vitamins and minerals. There has to be something “this organization stands for,” or else it degenerates into disorganization, confusion, and paralysis. In a business, the value commitment may be to technical leadership or (as in Sears Roebuck) to finding the right goods and services for the American family and to procuring them at the lowest price and the best quality. "
" An executive’s focus on contribution by itself is a powerful force in developing people. People adjust to the level of the demands made on them. The executive who sets his sights on contribution, raises the sights and standards of everyone with whom he works.
• A new hospital administrator, holding his first staff meeting, thought that a rather difficult matter had been settled to everyone’s satisfaction, when one of the participants suddenly asked: “Would this have satisfied Nurse Bryan?” At once the argument started all over and did not subside until a new and much more ambitious solution to the problem had been hammered out.
Nurse Bryan, the administrator learned, had been a long-serving nurse at the hospital. She was not particularly distinguished, had not in fact ever been a supervisor. But whenever a decision on patient care came up on her floor, Nurse Bryan would ask, “Are we doing the best we can do to help this patient?” Patients on Nurse Bryan’s floor did better and recovered faster. Gradually over the years, the whole hospital had learned to adopt what came to be known as “Nurse Bryan’s Rule”; had learned, in other words, to ask: “Are we really making the best contribution to the purpose of this hospital?”
Though Nurse Bryan herself had retired almost ten years earlier, the standards she had set still made demands on people who in terms of training and position were her superiors. "
" The most common cause of executive failure is inability or unwillingness to change with the demands of a new position. "
" This was the main reason for the failure of so many able men as executives in World War II Washington. That Washington was “political” or that men who had always been on their own suddenly found themselves “cogs in a big machine” were at most contributing factors. Plenty of men proved themselves highly effective Washington executives even though they had no political sense or had never worked in anything bigger than a two-man law practice...The men who succeeded in wartime Washington focused on contribution...As a result, they changed both what they did and the relative weight they gave to each of the value dimensions in their work. The failures worked much harder in a good many cases. But they did not challenge themselves, and they failed to see the need for redirecting their efforts. "
"
From then on for the rest of his tenure, he walked through the personnel department three times a week on his way back from lunch and picked up at random eight or ten file folders of young men in the supervisory group. Back in his office, he opened the first man’s folder, scanned it rapidly, and put through a telephone call to the man’s superior. “Mr. Robertson, this is the president in New York. You have on your staff a young man, Joe Jones. Didn’t you recommend six months ago that he be put in a job where he could acquire some merchandising experience? You did. Why haven’t you done anything about it?” And down would go the receiver.
The next folder opened, he would call another manager in another city: “Mr. Smith, this is the president in New York. I understand that you recommended a young man on your staff, Dick Roe, for a job in which he can learn something about store accounting. I just noticed that you have followed through with this recommendation, and I want to tell you how pleased I am to see you working at the development of our young people.” This man was in the president’s chair only a few years before he himself retired. But today, ten or fifteen years later, executives who never met him attribute to him, and with considerable justice, the tremendous growth and success of the company since his time.
"
"
The McNamara? story shows that the higher the position an executive holds, the larger will the outside loom in his contribution. No one else in the organization can as a rule move as freely on the outside. "
" For the knowledge worker to focus on contribution is particularly important. This alone can enable him to contribute at all.
Knowledge workers do not produce a “thing.” They produce ideas, information, concepts. The knowledge worker, moreover, is usually a specialist. In fact, he can, as a rule, be effective only if he has learned to do one thing very well; that is, if he has specialized. By itself, however, a specialty is a fragment and sterile. Its output has to be put together with the output of other specialists before it can produce results.
The task is not to breed generalists. It is to enable the specialist to make himself and his specialty effective. This means that he must think through who is to use his output and what the user needs to know and to understand to be able to make productive the fragment the specialist produces. • It is popular today to believe that our society is divided into “scientists” and “laymen.” It is then easy to demand that the laymen learn a little bit of the scientists’ knowledge, his terminology, his tools, and so on. But if society was ever divided that way, it was a hundred years ago. Today almost everybody in modern organization is an expert with a high degree of specialized knowledge, each with its own tools, its own concerns, and its own jargon. "
" The man of knowledge has always been expected to take responsibility for being understood. It is barbarian arrogance to assume that the layman can or should make the effort to understand him, and that it is enough if the man of knowledge talks to a handful of fellow experts who are his peers. Even in the university or in the research laboratory, this attitude—alas, only too common today—condemns the expert to uselessness and converts his knowledge from learning into pedantry. If a man wants to be an executive—that is, if he wants to be considered responsible for his contribution—he has to concern himself with the usability of his “product”—that is, his knowledge. "
" Effective executives... are almost imperceptibly led by their upward orientation into finding out what the other fellow needs, what the other fellow sees, and what the other fellow understands. Effective executives find themselves asking other people in the organization, their superiors, their subordinates, but above all, their colleagues in other areas: “What contribution from me do you require to make your contribution to the organization? When do you need this, how do you need it, and in what form?” "
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Executives in an organization do not have good human relations because they have a “talent for people.” They have good human relations because they focus on contribution in their own work and in their relationships with others. As a result, their relationships are productive—and this is the only valid definition of “good human relations.” Warm feelings and pleasant words are meaningless, are indeed a false front for wretched attitudes, if there is no achievement in what is, after all, a work-focused and task-focused relationship. On the other hand, an occasional rough word will not disturb a relationship that produces results and accomplishments for all concerned. "
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The focus on contribution by itself supplies the four basic requirements of effective human relations:
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We have been working at communications downward from management to the employees, from the superior to the subordinate. But communications are practically impossible if they are based on the downward relationship. This much we have learned from our work in perception and communications theory. The harder the superior tries to say something to his subordinate, the more likely is it that the subordinate will mishear. He will hear what he expects to hear rather than what is being said.
But executives who take responsibility for contribution in their own work will as a rule demand that their subordinates take responsibility too. They will tend to ask their men: “What are the contributions for which this organization and I, your superior, should hold you accountable? What should we expect of you? What is the best utilization of your knowledge and your ability?” And then communication becomes possible, becomes indeed easy.
Once the subordinate has thought through what contribution should be expected of him, the superior has, of course, both the right and the responsibility to judge the validity of the proposed contribution. • According to all our experience, the objectives set by subordinates for themselves are almost never what the superior thought they should be. The subordinates or juniors, in other words, do see reality quite differently. And the more capable they are, the more willing to take responsibility, the more will their perception of reality and of its objective opportunities and needs differ from the view of their superior or of the organization. But any discrepancy between their conclusions and what their superior expected will stand out strongly.
Who is right in such a difference is not as a rule important. For effective communication in meaningful terms has already been established. "
" The focus on contribution leads to communications sideways and thereby makes teamwork possible.
The question, “Who has to use my output for it to become effective?” immediately shows up the importance of people who are not in line of authority, either upward or downward, from and to the individual executive. "
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In a hospital in which the focus on contribution has become ingrained habit, there is almost no difficulty in achieving such team work. In other hospitals this sideways communication, this spontaneous self-organization into the right task-focused teams, does not occur despite frantic efforts to obtain communications and coordination through all kinds of committees, staff conferences, bulletins, sermons, and the like. ... Focus on upward contribution will not, by itself, provide the organizational solution. It will, however, contribute understanding of the task and communications to make imperfect organization perform. "
" Communications within the knowledge work force is becoming critical as a result of the computer revolution in information. Throughout the ages the problem has always been how to get “communication” out of “information.” Because information had to be handled and transmitted by people, it was always distorted by communications; that is, by opinion, impression, comment, judgment, bias, and so on. Now suddenly we are in a situation in which information is largely impersonal and, therefore, without any communications content. It is pure information.
But now we have the problem of establishing the necessary minimum of communications so that we understand each other and can know each other’s needs, goals, perceptions, and ways of doing things. Information does not supply this. Only direct contact, whether by voice or by written word, can communicate.
The more we automate information-handling, the more we will have to create opportunities for effective communication. "
" The man who asks of 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?” "
" We know very little about self-development. But we do know one thing: People in general, and knowledge workers in particular, grow according to the demands they make on themselves. They grow according to what they consider to be achievement and attainment. If they demand little of themselves, they will remain stunted. If they demand a good deal of themselves, they will grow to giant stature—without any more effort than is expended by the nonachievers. "
" The executive who focuses on contribution also stimulates others to develop themselves "
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Effective executives 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 is called, a report asked for, or a presentation organized. They insist that the meeting serve the contribution to which they have committed themselves. • The effective man always states at the outset of a meeting the specific purpose and contribution it is to achieve. He makes sure that the meeting addresses itself to this purpose. He does not allow a meeting called to inform to degenerate into a “bull session” in which everyone has bright ideas. But a meeting called by him to stimulate thinking and ideas also does not become simply a presentation on the part of one of the members, but is run to challenge and stimulate everybody in the room. He always, at the end of his meetings, goes back to the opening statement and relates the final conclusions to the original intent.
There are other rules for making a meeting productive (for instance, the obvious but usually disregarded rule that one can either direct a meeting and listen for the important things being said, or one can take part and talk; one cannot do both). But the cardinal rule is to focus it from the start on contribution. "
"The effective executive... does not make staffing decisions to minimize weaknesses but to maximize strength. "
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• President Lincoln when told that General Grant, his new commander-in-chief, was fond of the bottle said: “If I knew his brand, I’d send a barrel or so to some other generals.” After a childhood on the Kentucky and Illinois frontier, Lincoln assuredly knew all about the bottle and its dangers. But of all the Union generals, Grant alone had proven consistently capable of planning and leading winning campaigns. Grant’s appointment was the turning point of the Civil War. It was an effective appointment because Lincoln chose his general for his tested ability to win battles and not for his sobriety, that is, for the absence of a weakness.
Lincoln learned this the hard way however. Before he chose Grant, he had appointed in succession three or four Generals whose main qualifications were their lack of major weaknesses. As a result, the North, despite its tremendous superiority in men and materiel, had not made any headway for three long years from 1861 to 1864. In sharp contrast, Lee, in command of the Confederate forces, had staffed from strength. Every one of Lee’s generals, from Stonewall Jackson on, was a man of obvious and monumental weaknesses. But these failings Lee considered—rightly—to be irrelevant. Each of them had, however, one area of real strength—and it was this strength, and only this strength, that Lee utilized and made effective. As a result, the “well-rounded” men Lincoln had appointed were beaten time and again by Lee’s “single-purpose tools,” the men of narrow but very great strength.
Whoever tries to place a man or staff an organization to avoid weakness will end up at best with mediocrity. The idea that there are “well-rounded” people, people who have only strengths and no weaknesses (whether the term used is the “whole man,” the “mature personality,” the “well-adjusted personality,” or the “generalist”) is a prescription for mediocrity if not for incompetence. Strong people always have strong weaknesses too. Where there are peaks, there are valleys. And no one is strong in many areas. Measured against the universe of human knowledge, experience, and abilities, even the greatest genius would have to be rated a total failure. There is no such thing as a “good man.” Good for what? is the question.
The executive who is concerned with what a man cannot do rather than with what he can do, and who therefore tries to avoid weakness rather than make strength effective is a weak man himself. He probably sees strength in others as a threat to himself. But no executive has ever suffered because his subordinates were strong and effective. There is no prouder boast, but also no better prescription, for executive effectiveness than the words Andrew Carnegie, the father of the U.S. steel industry, chose for his own tombstone: “Here lies a man who knew how to bring into his service men better than he was himself.” But of course every one of these men was “better” because Carnegie looked for his strength and put it to work. Each of these steel executives was a “better man” in one specific area and for one specific job. Carnegie, however, was the effective executive among them.
• Another story about General Robert E. Lee illustrates the meaning of making strength productive. One of his generals, the story goes, had disregarded orders and had thereby completely upset Lee’s plans—and not for the first time either. Lee, who normally controlled his temper, blew up in a towering rage. When he had simmered down, one of his aides asked respectfully, “Why don’t you relieve him of his command?” Lee, it is said, turned around in complete amazement, looked at the aide, and said, “What an absurd question—he performs.” Effective executives know that their subordinates are paid to perform and not to please their superiors. They know that it does not matter how many tantrums a prima donna throws as long as she brings in the customers. The opera manager is paid after all for putting up with the prima donna’s tantrums if that is her way to achieve excellence in performance. It does not matter whether a first-rate teacher or a brilliant scholar is pleasant to the dean or amiable in the faculty meeting. The dean is paid for enabling the first-rate teacher or the first-rate scholar to do his work effectively—and if this involves unpleasantness in the administrative routine, it is still cheap at the price.
Effective executives never ask “How does he get along with me?” Their question is “What does he contribute?” Their question is never “What can a man not do?” Their question is always “What can he do uncommonly well?” In staffing they look for excellence in one major area, and not for performance that gets by all around.
To look for one area of strength and to attempt to put it to work is dictated by the nature of man. In fact, all the talk of “the whole man” or the “mature personality” hides a profound contempt for man’s most specific gift: his ability to put all his resources behind one activity, one field of endeavor, one area of accomplishment. It is, in other words, contempt for excellence. Human excellence can only be achieved in one area, or at the most in very few.
People with many interests do exist—and this is usually what we mean when we talk of a “universal genius.” People with outstanding accomplishments in many areas are unknown. Even Leonardo performed only in the area of design despite his manifold interests; if Goethe’s poetry had been lost and all that were known of his work were his dabblings in optics and philosophy, he would not even rate a footnote in the most learned encyclopedia. What is true for the giants holds doubly for the rest of us. Unless, therefore, an executive looks for strength and works at making strength productive, he will only get the impact of what a man cannot do, of his lacks, his weaknesses, his impediments to performance and effectiveness. To staff from what there is not and to focus on weakness is wasteful—a misuse, if not abuse, of the human resource.
To focus on strength is to make demands for performance. The man who does not first ask, “What can a man do?” is bound to accept far less than the associate can really contribute. He excuses the associate’s nonperformance in advance. He is destructive but not critical, let alone realistic. The really “demanding boss”—and one way or another all makers of men are demanding bosses—always starts out with what a man should be able to do well—and then demands that he really do it.
To try to build against weakness frustrates the purpose of organization. Organization is the specific instrument to make human strengths redound to performance while human weakness is neutralized and largely rendered harmless. The very strong neither need nor desire organization. They are much better off working on their own. The rest of us, however, the great majority, do not have so much strength that by itself it would become effective despite our limitations. "
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All this is obvious, one might say. Why then, is it not done all the time? Why are executives rare who make strength productive— especially the strength of their associates? Why did even a Lincoln staff from weakness three times before he picked strength?
The main reason is that the immediate task of the executive is not to place a man; it is to fill a job. The tendency is therefore to start out with the job as being a part of the order of nature. Then one looks for a man to fill the job. It is only too easy to be misled this way into looking for the “least misfit” —the one man who leaves least to be desired. And this is invariably the mediocrity.
The widely advertised “cure” for this is to structure jobs to fit the personalities available. But this cure is worse than the disease—except perhaps in a very small and simple organization. Jobs have to be objective; that is, determined by task rather than by personality.
One reason for this is that every change in the definition, structure, and position of a job within an organization sets off a chain reaction of changes throughout the entire institution. Jobs in an organization are interdependent and interlocked. One cannot change everybody’s work and responsibility just because one has to replace a single man in a single job. To structure a job to a person is almost certain to result in the end in greater discrepancy between the demands of the job and the available talent. It results in a dozen people being uprooted and pushed around in order to accommodate one. "
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But there is a subtler reason for insistence on impersonal, objective jobs. It is the only way to provide the organization with the human diversity it needs. It is the only way to tolerate — indeed to encourage—differences in temperament and personality in an organization. To tolerate diversity, relationships must be task-focused rather than personality-focused. Achievement must be measured against objective criteria of contribution and performance. This is possible, however, only if jobs are defined and structured impersonally. Otherwise the accent will be on “Who is right?” rather than on “What is right?” In no time, personnel decisions will be made on “Do I like this fellow?” or “Will he be acceptable?” rather than by asking “Is he the man most likely to do an outstanding job?” Structuring jobs to fit personality is almost certain to lead to favoritism and conformity. "
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• One implication is that the men who build first-class executive teams are not usually close to their immediate colleagues and subordinates. Picking people for what they can do rather than on personal likes or dislikes, they seek performance, not conformance. To insure this outcome, they keep a distance between themselves and their close colleagues.
Lincoln, it has often been remarked, only became an effective chief executive after he had changed from close personal relations—for example, with Stanton, his Secretary of War —to aloofness and distance. Franklin D. Roosevelt had no “friend” in the Cabinet—not even Henry Morgenthau, his Secretary of the Treasury, and a close friend on all nongovernmental matters. General Marshall and Alfred P. Sloan were similarly remote. These were all warm men, in need of close human relationships, endowed with the gift of making and keeping friends. They knew however that their friendships had to be “off the job.” They knew that whether they liked a man or approved of him was irrelevant, if not a distraction. And by staying aloof they were able to build teams of great diversity but also of strength. "
" Of course there are always exceptions where the job should be fitted to the man. Even Sloan, despite his insistence on impersonal structure, consciously designed the early engineering organization of General Motors around a man, Charles F. Kettering, the great inventor. Roosevelt broke every rule in the book to enable the dying Harry Hopkins to make his unique contribution. But these exceptions should be rare. And they should only be made for a man who has proven exceptional capacity to do the unusual with excellence. "
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By and large they follow four rules:
1. They do not start out with the assumption that jobs are created by nature or by God. They know that they have been designed by highly fallible men. And they are therefore forever on guard against the “impossible” job, the job that simply is not for normal human beings.
Such jobs are common. They usually look exceedingly logical on paper. But they cannot be filled. One man of proven performance capacity after the other is tried—and none does well. Six months or a year later, the job has defeated them.
Almost always such a job was first created to accommodate an unusual man and tailored to his idiosyncrasies. It usually calls for a mixture of temperaments that is rarely found in one person. Individuals can acquire very divergent kinds of knowledge and highly disparate skills. But they cannot change their temperaments. A job that calls for disparate temperaments becomes an “undoable” job, a man-killer.
The rule is simple: 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.
• Every text on marketing concludes, for instance, that sales management belongs together with advertising and promotion and under the same marketing executive. The experience of large, national manufacturers of branded and mass-marketed consumer goods has been, however, that this overall marketing job is impossible. Such a business needs both high effectiveness in field selling—that is, in moving goods —and high effectiveness in advertising and promo-tion—that is, in moving people. These appeal to different personalities which rarely can be found in one man.
The presidency of a large university in the United States is also such an impossible job. At least our experience has been that only a small minority of the appointments to this position work out—even though the men chosen have almost always a long history of substantial achievement in earlier assignments.
Another example is probably the international vice-president of today’s large multinational business. As soon as production and sales outside the parent company’s territory become significant—as soon as they exceed one fifth of the total or so—putting everything that is “not parent company” in one organizational component creates an impossible, a man-killing, job. The work either has to be reorganized by worldwide product groups (as Philips in Holland has done, for instance) or according to common social and economic characteristics of major markets. For instance, it might be split into three jobs: one managing the business in the industrialized countries (the United States, Canada, Western Europe, Japan); one the business in the developing countries (most of Latin America, Australia, India, the near East); one the business in the remaining underdeveloped ones. Several major chemical companies are going this route.
The ambassador of a major power today is in a similar predicament. His embassy has become so huge, unwieldy, and diffuse in its activities that a man who can administer it has no time for, and almost certainly no interest in, his first job: getting to know the country of his assignment, its government, its policies, its people, and to get known and trusted by them. And despite Mr. McNamara’s? lion-taming act at the Pentagon, I am not yet convinced that the job of Secretary of Defense of the United States is really possible (though I admit I cannot conceive of an alternative).
The effective executive therefore first makes sure that the job is well-designed. And if experience tells him otherwise, he does not hunt for genius to do the impossible. He redesigns the job.
He knows that the test of organization is not genius. It is its capacity to make common people achieve uncommon performance. "
"It should have challenge to bring out whatever strength a man may have."
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This, however, is not the policy of most large organizations. They tend to make the job small ... The demands of any job above the simplest are also bound to change, and often abruptly. The “perfect fit” then rapidly becomes the misfit. Only if the job is big and demanding to begin with, will it enable a man to rise to the new demands of a changed situation. "
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This rule applies to the job of the beginning knowledge worker in particular. Whatever his strength it should have a chance to find full play. In his first job the standards are set by which a knowledge worker will guide himself the rest of his career and by which he will measure himself and his contribution. Till he enters the first adult job, the knowledge worker never has had a chance to perform. All one can do in school is to show promise. Performance is possible only in real work, whether in a research lab, in a teaching job, in a business or in a government agency. Both for the beginner in knowledge work and for the rest of the organization, his colleagues and his superiors, the most important thing to find out is what he really can do.
It is equally important for him to find out as early as possible whether he is indeed in the right place, or even in the right kind of work. "
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• This not only holds for different kinds of organization, such as government agencies, universities, or businesses. It is equally true between organizations of the same kind. I have yet to see two large businesses which have the same values and stress the same contributions. That a man who was happy and productive as a member of the faculty of one university may find himself lost, unhappy, and frustrated when he moves to another one every academic administrator has learned. "
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Every survey of young knowledge workers—physicians in the Army Medical Corps, chemists in the research lab, accountants or engineers in the plant, nurses in the hospital—produces the same results. 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. Those that are deeply frustrated all say, in one way or another: “My abilities are not being put to use.” "
" The young knowledge worker whose job is too small to challenge and test his abilities either leaves or declines rapidly into premature middle-age, soured, cynical, unproductive. Executives everywhere complain that many young men with fire in their bellies turn so soon into burned-out sticks. They have only themselves to blame: They quenched the fire by making the young man’s job too small. "
" This, however, means that they do their thinking about people long before the decision on filling a job has to be made, and independently of it.
This is the reason for the wide adoption of appraisal procedures today, in which people, especially those in knowledge work, are regularly judged. The purpose is to arrive at an appraisal of a man before one has to decide whether he is the right person to fill a bigger position.
However, while almost every large organization has an appraisal procedure, few of them actually use it. Again and again the same executives who say that of course they appraise every one of their subordinates at least once a year, report that, to the best of their knowledge, they themselves have never been appraised by their own superiors. Again and again the appraisal forms remain in the files, and nobody looks at them when a personnel decision has to be made. Everybody dismisses them as so much useless paper. Above all, almost without exception, the “appraisal interview” in which the superior is to sit down with the subordinate and discuss the findings never takes place. Yet the appraisal interview is the crux of the whole system. One clue to what is wrong was contained in an advertisement of a new book on management which talked of the appraisal interview as “the most distasteful job” of the superior.
Appraisals, as they are now being used in the great majority of organizations, were designed originally by the clinical and abnormal psychologists for their own purposes. The clinician is a therapist trained to heal the sick. He is legitimately concerned with what is wrong, rather than with what is right with the patient. He assumes as a matter of course that nobody comes to him unless he is in trouble. The clinical psychologist or the abnormal psychologist, therefore, very properly looks upon appraisals as a process of diagnosing the weaknesses of a man.
• I became aware of this in my first exposure to Japanese management. Running a seminar on executive development, I found to my surprise that none of the Japanese participants —all top men in large organizations—used appraisals. When I asked why not, one of them said: “Your appraisals are concerned only with bringing out a man’s faults and weaknesses. Since we can neither fire a man nor deny him advancement and promotion, this is of no interest to us. On the contrary, the less we know about his weaknesses, the better. What we do need to know are the strengths of a man and what he can do. Your appraisals are not even interested in this.” Western psychologists—especially those that design appraisals— might well disagree. But this is how every executive, whether Japanese, American, or German, sees the traditional appraisals. "
" As everyone has heard, there is “lifetime employment” in Japan. Once a man is on the payroll, he will advance in his category—as a worker, a white-collar employee, or a professional and executive employee — according to his age and length of service, with his salary doubling about once every fifteen years. He cannot leave, neither can he be fired. Only at the top and after age forty-five is there differentiation, with a very small group selected by ability and merit into the senior executive positions. How can such a system be squared with the tremendous capacity for results and achievement Japan has shown? The answer is that their system forces the Japanese to play down weaknesses. Precisely because they cannot move people, Japanese executives always look for the man in the group who can do the job. They always look for strength.
I do not recommend the Japanese system. It is far from ideal. A very small number of people who have proven their capacity to perform do, in effect, everything of any importance whatever. The rest are carried by the organization. But if we in the West expect to get the benefit of the much greater mobility that both individual and organization enjoy in our tradition, we had better adopt the Japanese custom of looking for strength and using strength. "
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For a superior to focus on weakness, as our appraisals require him to do, destroys the integrity of his relationship with his subordinates. ... To discuss a man’s defects when he comes in as a patient seeking help is the responsibility of the healer. But, as has been known since Hippocrates, this presupposes a professional and privileged relationship between healer and patient which is incompatible with the authority relationship between superior and subordinate. It is a relationship that makes continued working together almost impossible. That so few executives use the official appraisal is thus hardly surprising. It is the wrong tool, in the wrong situation, for the wrong purpose.
Appraisals—and the philosophy behind them—are also far too much concerned with “potential.” But experienced people have learned that one cannot appraise potential for any length of time ahead or for anything very different from what a man is already doing. ... All one can measure is performance. And all one should measure is performance. This is another reason for making jobs big and challenging. It is also a reason for thinking through the contribution a man should make to the results and the performance of his organization. For one can measure the performance of a man only against specific performance expectations.
Still one needs some form of appraisal procedure—or else one makes the personnel evaluation at the wrong time, that is when a job has to be filled. Effective executives, therefore, usually work out their own radically different form. It starts out with a statement of the major contributions expected from a man in his past and present positions and a record of his performance against these goals. Then it asks four questions:
(a) “What has he [or she] done well?”
(b) “What, therefore, is he likely to be able to do well?”
(c) “What does he have to learn or to acquire to be able to get the full benefit from his strength?”
(d) “If I had a son or daughter, would I be willing to have him or her work under this person?”
(i) “If yes, why?”
(ii) “If no, why?”
This appraisal actually takes a much more critical look at a man than the usual procedure does. But it focuses on strengths. It begins with what a man can do. Weaknesses are seen as limitations to the full use of his strengths and to his own achievement, effectiveness, and accomplishment.
The last question (ii) is the only one which is not primarily concerned with strengths. Subordinates, especially bright, young, and ambitious ones, tend to mold themselves after a forceful boss. There is, therefore, nothing more corrupting and more destructive in an organization than a forceful but basically corrupt executive. Such a man might well operate effectively on his own; even within an organization, he might be tolerable if denied all power over others. But in a position of power within an organization, he destroys. Here, therefore, is the one area in which weakness in itself is of importance and relevance.
By themselves, character and integrity do not accomplish anything. But their absence faults everything else. Here, therefore, is the one area where weakness is a disqualification by itself rather than a limitation on performance capacity and strength.
" There have been few great commanders in history who were not self-centered, conceited, and full of admiration for what they saw in the mirror. (The reverse does not, of course, hold: There have been plenty of generals who were convinced of their own greatness, but who have not gone down in history as great commanders.) Similarly, the politician who does not with every fiber in his body want to be President or Prime Minister is not likely to be remembered as a statesman. "
" If the need is for the ability to command in a perilous situation, one has to accept a Disraeli or a Franklin D. Roosevelt and not worry too much about their lack of humility. There are indeed no great men to their valets. But the laugh is on the valet. He sees, inevitably, all the traits that are not relevant, all the traits that have nothing to do with the specific task for which a man has been called on the stage of history. "
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The effective executive will therefore ask: “Does this man have strength in one major area? And is this strength relevant to the task? If he achieves excellence in this one area, will it make a significant difference?” And if the answer is “yes,” he will go ahead and appoint the man.
Effective executives rarely suffer from the delusion that two mediocrities achieve as much as one good man. They have learned that, as a rule, two mediocrities achieve even less than one mediocrity—they just get in each other’s way. They accept that abilities must be specific to produce performance. They never talk of a “good man” but always about a man who is “good” for some one task. But in this one task, they search for strength and staff for excellence.
This also implies that they focus on opportunity in their staffing—not on problems.
They are above all intolerant of the argument: “I can’t spare this man; I’d be in trouble without him.” They have learned that there are only three explanations for an “indispensable man”: He is actually incompetent and can only survive if carefully shielded from demands; his strength is misused to bolster a weak superior who cannot stand on his own two feet; or his strength is misused to delay tackling a serious problem if not to conceal its existence.
In every one of these situations, the “indispensable man” should be moved anyhow—and soon. Otherwise one only destroys whatever strengths he may have.
• The chief executive who was mentioned in Chapter 3 for his unconventional methods of making effective the manager-development policies of a large retail chain also decided to move automatically anyone whose boss described him as indispensable. “This either means,” he said, “that I have a weak superior or a weak subordinate—or both. Whichever of these, the sooner we find out, the better.”
Altogether it must be an unbreakable rule to promote the man who by the test of performance is best qualified for the job to be filled. All arguments to the contrary—“He is indispensable” . . . “He won’t be acceptable to the people there” . . . “He is too young” . . . or “We never put a man in there without field experience”—should be given short shrift. Not only does the job deserve the best man. The man of proven performance has earned the opportunity. Staffing the opportunities instead of the problems not only creates the most effective organization, it also creates enthusiasm and dedication.
Conversely, it is the duty of the executive 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. It is grossly unfair to his subordinates who are deprived by their superior’s inadequacy of opportunities for achievement and recognition. Above all, it is senseless cruelty to the man himself. He knows that he is inadequate whether he admits it to himself or not. Indeed, I have never seen anyone in a job for which he was inadequate who was not slowly being destroyed by the pressure and the strains, and who did not secretly pray for deliverance. That neither the Japanese “lifetime employment” nor the various civil service systems of the West consider proven incompetence ground for removal is a serious weakness—and an unnecessary one.
• General Marshall during World War II insisted that a general officer be immediately relieved if found less than outstanding. To keep him in command, he reasoned, was incompatible with the responsibility the army and the nation owed the men under an officer’s command. Marshall flatly refused to listen to the argument: “But we have no replacement.” “All that matters,” he pointed out, “is that you know that this man is not equal to the task. Where his replacement comes from is the next question.”
But Marshall also insisted that to relieve a man from command was less a judgment on the man than on the commander who had appointed him. “The only thing we know is that this spot was the wrong one for the man,” he argued. “This does not mean that he is not the ideal man for some other job. Appointing him was my mistake, now it’s up to me to find what he can do.”
Altogether General Marshall offers a good example how one makes strength productive. When he first reached a position of influence in the mid-thirties, there was no general officer in the U.S. Army still young enough for active duty. (Marshall himself only beat the deadline by four months. His sixtieth birthday when he would have been too old to take office as Chief of Staff, was on December 31, 1939. He was appointed on September 1 of the same year.) The future generals of World War II were still junior officers with few hopes for promotion when Marshall began to select and train them. Eisenhower was one of the older ones and even he, in the mid-thirties, was only a major. Yet by 1942, Marshall had developed the largest and clearly the ablest group of general officers in American history. There were almost no failures in it and not many second-raters.
This—one of the greatest educational feats in military his-tory—was done by a man who lacked all the normal trappings of “leadership,” such as the personal magnetism or the towering self-confidence of a Montgomery, a de Gaulle or a MacArthur?. What Marshall had were principles. “What can this man do?” was his constant question. And if a man could do something, his lacks became secondary.
• Marshall, for instance, again and again came to George Patton’s rescue and made sure that this ambitious, vain, but powerful wartime commander would not be penalized for the absence of the qualities that make a good staff officer and a successful career soldier in peacetime. Yet Marshall himself personally loathed the dashing beau sabreur of Patton’s type.
Marshall was only concerned with weaknesses when they limited the full development of a man’s strength. These he tried to overcome through work and career opportunities.
• The young Major Eisenhower, for instance, was quite deliberately put by Marshall into war-planning in the mid-thirties to help him acquire the systematic strategic understanding which he apparently lacked. Eisenhower did not himself become a strategist as a result. But he acquired respect for strategy and an understanding of its importance and thereby removed a serious limitation on his great strength as a team-builder and tactical planner.
Marshall always appointed the best qualified man no matter how badly he was needed where he was. “We owe this move to the job . . . we owe it to the man and we owe it to the troops,” was his reply when someone—usually someone high up— pleaded with him not to pull out an “indispensable” man.
• He made but one exception: When President Roosevelt pleaded that Marshall was indispensable to him, Marshall stayed in Washington, yielded supreme command in Europe to Eisenhower, and thus gave up his life’s dream.
Finally Marshall knew—and everyone can learn it from him—that every people-decision is a gamble. By basing it on what a man can do, it becomes at least a rational gamble.
A superior has responsibility for the work of others. He also has power over the careers of others. Making strengths productive is therefore much more than an essential of effectiveness. It is a moral imperative, a responsibility of authority and position. 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. But even more does he owe it to the human beings over whom he exercises authority to help them get the most out of whatever strength they may have. Organization must serve the individual to achieve through his strengths and regardless of his limitations and weaknesses. "
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Above all, the effective executive tries to make fully productive the strengths of his own superior.
I have yet to find a manager, whether in business, in government, or in any other institution, who did not say: “I have no great trouble managing my subordinates. But how do I manage my boss?” It is actually remarkably easy—but only effective executives know that. The secret is that effective executives make the strengths of the boss productive.
• This should be elementary prudence. Contrary to popular legend, subordinates do not, as a rule, rise to position and prominence over the prostrate bodies of incompetent bosses. If their boss is not promoted, they will tend to be bottled up behind him. And if their boss is relieved for incompetence or failure, the successor is rarely the bright, young man next in line. He usually is brought in from the outside and brings with him his own bright, young men. Conversely, there is nothing quite as conducive to success, as a successful and rapidly promoted superior.
But way beyond prudence, making the strength of the boss productive is a key to the subordinate’s own effectiveness. It enables him to focus his own contribution in such a way that it finds receptivity upstairs and will be put to use. It enables him to achieve and accomplish the things he himself believes in.
One does not make the strengths of the boss productive by toadying to him. One does it by starting out with what is right and presenting it in a form which is accessible to the superior.
The effective executive accepts that the boss is human (something that intelligent young subordinates often find hard). Because the superior is human, he has his strengths; but he also has limitations. To build on his strengths, that is, to enable him to do what he can do, will make him effective—and will make the subordinate effective. To try to build on his weaknesses will be as frustrating and as stultifying as to try to build on the weaknesses of a subordinate. The effective executive, therefore, asks: “What can my boss do really well?” “What has he done really well?” “What does he need to know to use his strength?” “What does he need to get from me to perform?” He does not worry too much over what the boss cannot do.
• Subordinates typically want to “reform” the boss. The able senior civil servant is inclined to see himself as the tutor to the newly appointed political head of his agency. He tries to get his boss to overcome his limitations. The effective ones ask instead: “What can the new boss do?” And if the answer is: “He is good at relationships with Congress, the White House, and the public,” then the civil servant works at making it possible for his minister to use these abilities. For the best administration and the best policy decisions are futile unless there is also political skill in representing them. Once the politician knows that the civil servant supports him, he will soon enough listen to him on policy and on administration.
The effective executive also knows that the boss, being human, has his own ways of being effective. He looks for these ways. They may be only manners and habits, but they are facts.
It is, I submit, fairly obvious to anyone who has ever looked that people are either “readers” or “listeners” (excepting only the very small group who get their information through talking, and by watching with a form of psychic radar the reactions of the people they talk to; both President Franklin Roosevelt and President Lyndon Johnson belong in this category, as apparently did Winston Churchill). People who are both readers and listeners—trial lawyers have to be both, as a rule—are exceptions. It is generally a waste of time to talk to a reader. He only listens after he has read. It is equally a waste of time to submit a voluminous report to a listener. He can only grasp what it is all about through the spoken word.
Some people need to have things summed up for them in one page. (President Eisenhower needed this to be able to act.)
Others need to be able to follow the thought processes of the man who makes the recommendation and therefore require a big report before anything becomes meaningful to them. Some superiors want to see sixty pages of figures on everything. Some want to be in at the early stages so that they can prepare themselves for the eventual decision. Others do not want even to hear about the matter until it is “ripe,” and so on.
The adaptation needed to think through the strengths of the boss and to try to make them productive always affects the “how” rather than the “what.” It concerns the order in which different areas, all of them relevant, are presented, rather than what is important or right. If the superior’s strength lies in his political ability in a job in which political ability is truly relevant, then one presents to him first the political aspect of a situation. This enables him to grasp what the issue is all about and to put his strength effectively behind a new policy.
All of us are “experts” on other people and see them much more clearly than they see themselves. To make the boss effective is therefore usually fairly easy. But it requires focus on his strengths and on what he can do. It requires building on strength to make weaknesses irrelevant. Few things make an executive as effective as building on the strengths of his superior. "
" Effective executives lead from strength in their own work. They make productive what they can do.
Most executives I know in government, in the hospital, in a business, know all the things they cannot do. They are only too conscious of what the boss won’t let them do, of what company policy won’t let them do, of what the government won’t let them do. As a result, they waste their time and their strengths complaining about the things they cannot do anything about.
Effective executives are of course also concerned with limitations. But it is amazing how many things they find that can be done and are worth while doing. While the others complain about their inability to do anything, the effective executives go ahead and do. As a result, the limitations that weigh so heavily on their brethren often melt away.
• Everyone in the management of one of the major railroads knew that the government would not let the company do anything. But then a new financial vice-president came in who had not yet learned that “lesson.” Instead he went to Washington, called on the Interstate Commerce Commission and asked for permission to do a few rather radical things. “Most of these things,” the commissioners said, “are none of our concern to begin with. The others you have to try and test out and then we will be glad to give you the go-ahead.” The assertion that “somebody else will not let me do anything” should always be suspected as a cover-up for inertia. But even where the situation does set limitations—and everyone lives and works within rather stringent limitations—there are usually important, meaningful, pertinent things that can be done. The effective executive looks for them. If he starts out with the question: “What can I do?” he is almost certain to find that he can actually do much more than he has time and resources for. "
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It is not very difficult to know how we achieve results. By the time one has reached adulthood, one has a pretty good idea as to whether one works better in the morning or at night. One usually knows whether one writes best by making a great many drafts fast, or by working meticulously on every sentence until it is right. One knows whether one speaks well in public from a prepared text, from notes, without any prop, or not at all. One knows whether one works well as a member of a committee or better alone—or whether one is altogether unproductive as a committee member.
Some people work best if they have a detailed outline in front of them; that is, if they have thought through the job before they start it. Others work best with nothing more than a few rough notes. Some work best under pressure. Others work better if they have a good deal of time and can finish the job long before the deadline. Some are “readers,” others “listeners.” All this one knows, about oneself—just as one knows whether one is right-handed or left-handed.
These, it will be said, are superficial. This is not necessarily correct—a good many of these traits and habits mirror fundamentals of a man’s personality such as his perception of the world and of himself in it. But even if superficial, these work habits are a source of effectiveness. And most of them are compatible with any kind of work. The effective executive knows this and acts accordingly.
All in all, the effective executive tries to be himself; he does not pretend to be someone else. He looks at his own performance and at his own results and tries to discern a pattern. “What are the things,” he asks, “that I seem to be able to do with relative ease, while they come rather hard to other people?” One man, for instance, finds it easy to write up the final report while many others find it a frightening chore. At the same time, however, he finds it rather difficult and unrewarding to think through the report and face up to the hard decisions. He is, in other words, more effective as a staff thinker who organizes and lays out the problems than as the decision-maker who takes command responsibility.
One can know about oneself that one usually does a good job working alone on a project from start to finish. One can know that one does, as a rule, quite well in negotiations, particularly emotional ones such as negotiating a union contract. But at the same time, one also knows whether one’s predictions what the union will ask for have usually been correct or not.
These are not the things most people have in mind when they talk about the strengths or weaknesses of a man. They usually mean knowledge of a discipline or talent in an art. But temperament is also a factor in accomplishment and a big one. An adult usually knows quite a bit about his own temperament. To be effective he builds on what he knows he can do and does it the way he has found out he works best. "
"only strength produces results. Weakness only produces headaches—and the absence of weakness produces nothing.
He knows, moreover, that the standard of any human group is set by the performance of the leaders. And he, therefore, never allows leadership performance to be based on anything but true strength. • In sports we have long learned that the moment a new record is set every athlete all over the world acquires a new dimension of accomplishment. For years no one could run the mile in less than four minutes. Suddenly Roger Bannister broke through the old record. And soon the average sprinters in every athletic club in the world were approaching yesterday’s record, while new leaders began to break through the four-minute barrier.
In human affairs, the distance between the leaders and the average is a constant. If leadership performance is high, the average will go up. The effective executive 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. This always requires focus on the one strength of a man and dismissal of weaknesses as irrelevant unless they hamper the full deployment of the available strength.
The task of an executive is not to change human beings. Rather, as the Bible tells us in the parable of the Talents, the task is to multiply performance capacity of the whole by putting to use whatever strength, whatever health, whatever aspiration there is in individuals. "
" concentration. Effective executives do first things first and they do one thing at a time.
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Some do their best work when doing two tasks in parallel at the same time, thus providing a change of pace. This presupposes however that they give each of the two tasks the minimum quantum needed to get anything done. But few people, I think, can perform with excellence three major tasks simultaneously. "
this maximizes throughput.
" This is the “secret” of those people who “do so many things” and apparently so many difficult things. They do only one at a time. As a result, they need much less time in the end than the rest of us. "
" The people who get nothing done often work a great deal harder. In the first place, they underestimate the time for any one task. They always expect that everything will go right "
slough off the past that has ceased to be productive. Effective executives periodically review their work programs—and those of their associates—and ask: “If we did not already do this, would we go into it now?” And unless the answer is an unconditional “Yes,” they drop the activity or curtail it sharply. At the least, they make sure that no more resources are being invested in the no-longer-productive past. And those first-class resources, especially those scarce resources of human strength which are engaged in these tasks of yesterday, are immediately pulled out and put to work on the opportunities of tomorrow.
Executives, whether they like it or not, are forever bailing out the past. This is inevitable. ...
Yet it is the executive’s specific job—whether he works in government, in a business, or in any other institution—to commit today’s resources to the future. This means that every executive forever has to spend time, energy, and ingenuity on patching up or bailing out the actions and decisions of yesterday, whether his own or those of his predecessors. In fact this always takes up more hours of his day than any other task.
But one can at least try to limit one’s servitude to the past by cutting out those inherited activities and tasks that have ceased to promise results.
No one has much difficulty getting rid of the total failures. They liquidate themselves. Yesterday’s successes, however, always linger on long beyond their productive life. Even more dangerous are the activities which should do well and which, for some reason or other, do not produce. These tend to become, as I have explained elsewhere “investments in managerial ego” and sacred.* Yet unless they are pruned, and pruned ruthlessly, they drain the lifeblood from an organization. It is always the most capable people who are wasted in the futile attempt to obtain for the investment in managerial ego the “success it deserves.”
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There is serious need for a new principle of effective administration under which every act, every agency, and every program of government is conceived as temporary and as expiring automatically after a fixed number of years— maybe ten—unless specifically prolonged by new legislation following careful outside study of the program, its results and its contributions.
President Johnson in 1965-1966 ordered such a study for all government agencies and their programs, adapting the “program review” which Secretary McNamara? had developed to rid the Defense department of the barnacles of obsolete and unproductive work. This is a good first step, and badly needed. But it will not produce results as long as we maintain the traditional assumption that all programs last forever unless proven to have outlived their usefulness. The assumption should rather be that all programs outlive their usefulness fast and should be scrapped unless proven productive and necessary. Otherwise, modern government, while increasingly smothering society under rules, regulations, and forms, will itself be smothered in its own fat.
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The need to slough off the outworn old to make possible the productive new is universal. It is reasonably certain that we would still have stagecoaches—nationalized, to be sure, heavily subsidized, and with a fantastic research program to “retrain the horse”—had there been ministries of transportation around 1825. "
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But while government is particularly endangered by organizational obesity, no organization is immune to the disease. The businessman in the large corporation who complains the loudest about bureaucracy in government may encourage in his own company the growth of “controls” which do not control anything, the proliferation of studies that are only a cover-up for his own unwillingness to face up to a decision, the inflation of all kinds of staffs for all kinds of research or “relations.” And he himself may waste his own time and that of his key people on the obsolescent product of yesterday while starving tomorrow’s successful product. The academician who is loudest in his denunciation of the horrible wastefulness of big business may fight the hardest in the faculty meeting to prolong the life of an obsolescent subject by making it a required course.
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...the effective executive will slough off an old activity before he starts on a new one. This is necessary in order to keep organizational “weight control.” Without it, the organization soon loses shape, cohesion, and manageability. Social organizations need to stay lean and muscular as much as biological organisms. "
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But also, as every executive has learned, nothing new is easy. It always gets into trouble. Unless one has therefore built into the new endeavor the means for bailing it out when it runs into heavy weather, one condemns it to failure from the start. The only effective means for bailing out the new are people who have proven their capacity to perform. Such people are always already busier than they should be. Unless one relieves one of them of his present burden, one cannot expect him to take on the new task.
The alternative—to “hire in” new people for new tasks—is too risky. One hires new people to expand on already established and smoothly running activity. But one starts something new with people of tested and proven strength, that is, with veterans. Every new task is such a gamble—even if other people have done the same job many times before—that an experienced and effective executive will not, if humanly possible, add to it the additional gamble of hiring an outsider to take charge. He has learned the hard way how many men who looked like geniuses when they worked elsewhere show up as miserable failures six months after they have started working “for us.” • An organization needs to bring in fresh people with fresh points of view fairly often. If it only promotes from within it soon becomes inbred and eventually sterile. But if at all possible, one does not bring in the newcomers where the risk is exorbitant—that is, into the top executive positions or into leadership of an important new activity. One brings them in just below the top and into an activity that is already defined and reasonably well understood.
Systematic sloughing off of the old is the one and only way to force the new. There is no lack of ideas in any organization I know. “Creativity” is not our problem. But few organizations ever get going on their own good ideas. Everybody is much too busy on the tasks of yesterday. "
" A decision ... has to be made as to which tasks deserve priority and which are of less importance. The only question is which will make the decision—the executive or the pressures. But somehow the tasks will be adjusted to the available time and the opportunities will become available only to the extent to which capable people are around to take charge of them.
If the pressures rather than the executive are allowed to make the decision, the important tasks will predictably be sacrificed. Typically, there will then be no time for the most time-consuming part of any task, the conversion of decision into action. ... This almost always means that no task is completed unless other people have taken it on as their own, have accepted new ways of doing old things or the necessity for doing something new, and have otherwise made the executive’s “completed” project their own daily routine. If this is slighted because there is no time, then all the work and effort have been for nothing.
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Another predictable result of leaving control of priorities to the pressures is that the work of top management does not get done at all. That is always postponable work, for it does not try to solve yesterday’s crises but to make a different tomorrow. ... In particular, a top group which lets itself be controlled by the pressures... will not pay attention to the outside of the organization....For the pressures always favor what goes on inside. They always favor what has happened over the future, the crisis over the opportunity, the immediate and visible over the real, and the urgent over the relevant.
The job is, however, not to set priorities. That is easy.... The reason why so few executives concentrate is the difficulty of setting “posteriorities”—that is, deciding what tasks not to tackle -- and of sticking to the decision.
Most executives have learned that what one postpones, one actually abandons. A good many of them suspect that there is nothing less desirable than to take up later a project one has postponed when it first came up. The timing is almost bound to be wrong, and timing is a most important element in the success of any effort. To do five years later what it would have been smart to do five years earlier is almost a sure recipe for frustration and failure. "
" That one actually abandons what one postpones makes executives, however, shy from postponing anything altogether. They know that this or that task is not a first priority, but giving it a posteriority is risky. What one has relegated may turn out to be the competitor’s triumph. There is no guarantee that the policy area a politician or an administrator has decided to slight may not explode into the hottest and most dangerous political issue. ... Setting a posteriority is also unpleasant. Every posteriority is somebody else’s top priority. It is much easier to draw up a nice list of top priorities and then to hedge by trying to do “just a little bit” of everything else as well. This makes everybody happy. The only drawback is, of course, that nothing whatever gets done.
A great deal could be said about the analysis of priorities. The most important thing about priorities and posteriorities is, however, not intelligent analysis but courage.
Courage rather than analysis dictates the truly important rules for identifying priorities: • Pick the future as against the past; • Focus on opportunity rather than on problem; • Choose your own direction—rather than climb on the bandwagon; and • Aim high, aim for something that will make a difference, rather than for something that is “safe” and easy to do.
A good many studies of research scientists have shown that achievement (at least below the genius level of an Einstein, a Niels Bohr, or a Max Planck) depends less on ability in doing research than on the courage to go after opportunity. Those research scientists who pick their projects according to the greatest likelihood of quick success rather than according to the challenge of the problem are unlikely to achieve distinction. They may turn out a great many footnotes, but neither a law of physics nor a new concept is likely to be named after them. Achievement goes to the people who pick their research priorities by the opportunity and who consider other criteria only as qualifiers rather than as determinants.
Similarly, in business the successful companies are not those that work at developing new products for their existing line but those that aim at innovating new technologies or new businesses. As a rule it is just as risky, just as arduous, and just as uncertain to do something small that is new as it is to do something big that is new.
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Priorities and posteriorities always have to be reconsidered and revised in the light of realities. No American president, for instance, has been allowed by events to stick to his original list of priority tasks ... The effective executive does not, in other words, truly commit himself beyond the one task he concentrates on right now. Then he reviews the situation and picks the next one task that now comes first.
Concentration—that is, the courage to impose on time and events his own decision as to what really matters and comes first—is the executive’s only hope of becoming the master of time and events instead of their whipping boy. "
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Decision-making is only one of the tasks of an executive. It usually takes but a small fraction of his time. But to make decisions is the specific executive task. Decision-making therefore deserves special treatment in a discussion of the effective executive.
Only executives make decisions. "
" Effective executives do not make a great many decisions. They concentrate on the important ones. They try to think through what is strategic and generic, rather than “solve problems.” They try to make the few important decisions on the highest level of conceptual understanding. They try to find the constants in a situation. They are, therefore, not overly impressed by speed in decision-making. Rather they consider virtuosity in manipulating a great many variables a symptom of sloppy thinking. They want to know what the decision is all about and what the underlying realities are which it has to satisfy. "
" the most time-consuming step in the process is not making the decision but putting it into effect. Unless a decision has “degenerated into work” it is not a decision; it is at best a good intention. This means that, while the effective decision itself is based on the highest level of conceptual understanding, the action to carry it out should be as close as possible to the working level and as simple as possible. "
" THE ELEMENTS OF THE DECISION PROCESS The truly important features of the decisions Vail and Sloan made are neither their novelty nor their controversial nature. They are: 1. The clear realization that the problem was generic and could only be solved through a decision which established a rule, a principle;
2. The definition of the specifications which the answer to the problem had to satisfy, that is, of the “boundary conditions”;
3. The thinking through what is “right,” that is, the solution which will fully satisfy the specifications before attention is given to the compromises, adaptations, and concessions needed to make the decision acceptable;
4. The building into the decision of the action to carry it out;
5. The “feedback” which tests the validity and effectiveness of the decision against the actual course of events.
These are the elements of the effective decision process.
1. The first question the effective decision-maker asks is: “Is this a generic situation or an exception?” “Is this something that underlies a great many occurrences? Or is the occurrence a unique event that needs to be dealt with as such?” The genetic always has to be answered through a rule, a principle. The exceptional can only be handled as such and as it comes.
Strictly speaking, one might distinguish between four, rather than between two, different types of occurrences. There is first the truly generic of which the individual occurrence is only a symptom.
Typically, a product control and engineering group will handle many hundreds of problems in the course of a month. Yet, whenever these are analyzed, the great majority prove to be just symptoms—that is, manifestations of underlying basic situations. The individual process control engineer or production engineer who works in one part of the plant usually cannot see this. He might have a few problems each month with the couplings in the pipes that carry steam or hot liquids. But only when the total workload of the group over several months is analyzed does the generic problem appear. Then one sees that temperatures or pressures have become too great for the existing equipment and that the couplings, holding different lines together, need to be redesigned for greater loads. Until this is done, process control will spend a tremendous amount of time fixing leaks without ever getting control of the situation.
Then there is the problem which, while a unique event for the individual institution, is actually generic.
• The company that receives an offer to merge from another, larger one, will never receive such an offer again if it accepts.
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Next there is the truly exceptional, the truly unique event.
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Truly unique events are rare, however. Whenever one appears, one has to ask: Is this a true exception or only the first manifestation of a new genus?
And this, the early manifestation of a new generic problem, is the fourth and last category of events with which the decision process deals. ...
All events but the truly unique require a generic solution. They require a rule, a policy, a principle. .... The effective decision-maker spends time to determine with which of these four situations he is dealing. He knows that he will make the wrong decision if he classifies the situation wrongly.
By far the most common mistake is to treat a generic situation as if it were a series of unique events; that is, to be pragmatic when one lacks the generic understanding and principle. ... Equally common is the mistake of treating a new event as if it were just another example of the old problem to which, therefore, the old rules should be applied. .... Almost as common is the plausible but erroneous definition of the fundamental problem. Here is one example.
• Since the end of World War II the American military services have been plagued by their inability to keep highly trained medical people in uniform. There have been dozens of studies... However, all of the studies start out with the plausible hypothesis that pay is the problem—whereas the real problem lies in the traditional structure of military medicine. With its emphasis on the general practitioner, it is out of alignment with today’s medical profession, which stresses the specialist. The career ladder in military medicine leads from specialization to medical and hospital administration and away from research and specialized practice. Today’s young, well-trained physicians, therefore, feel that they waste their time and skill in the military service where they either have to work as general practitioners or become chairbound administrators....
Or the definition of the problem may be incomplete.
• This largely explains why the American automobile industry found itself in 1966 suddenly under sharp attack for its unsafe cars—and also why the industry itself was so totally bewildered by the attack. It is simply not true that the industry has paid no attention to safety. On the contrary, it has worked hard at safer highway engineering and at driver training. ... Long ago it should have become clear that we have to do something about a small but significant probability of accidents that will occur despite safety laws and safety training. And this means that safe-highway and safe-driving campaigns have to be supplemented by engineering to make accidents themselves less dangerous. Where we engineered to make cars safe when used right, we also have to engineer to make cars safe when used wrong. This, however, the automobile industry failed to see.
This example shows why the incomplete explanation is often more dangerous than the totally wrong explanation. Everyone connected with safe-driving campaigns—the automobile industry, but also state highway commissioners, automobile clubs, and insurance companies—felt that to accept a probability of accidents was to condone, if not to encourage, dangerous driving— just as my grandmother’s generation believed that the doctor who treated venereal diseases abetted immorality. It is this common human tendency to confuse plausibility with morality which makes the incomplete hypothesis so dangerous a mistake and so hard to correct. "
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The effective decision-maker, therefore, always assumes initially that the problem is generic.
He always assumes that the event that clamors for his attention is in reality a symptom.
... And if the event is truly unique, the experienced decision-maker suspects that this heralds a new underlying problem and that what appears as unique will turn out to have been simply the first manifestation of a new generic situation. "
"This also explains why the effective decision-maker always tries to put his solution on the highest possible conceptual level. He does not solve the immediate financing problem by issuing whatever security would be easiest to sell at the best price for the next few years. If he expects to need the capital market for the foreseeable future, he invents a new kind of investor and designs the appropriate security for a mass-capital market that does not yet exist." (a reference to Vail of Bell, who invented "grandmother stocks" that paid reliable dividends, in an era where stocks were for speculators)
"
One of the most obvious facts of social and political life is the longevity of the temporary. British licensing hours for taverns, for instance, French rent controls, or Washington “temporary” government buildings, all three hastily developed in World War I to last “a few months of temporary emergency” are still with us fifty years later. The effective decision-maker knows this. He too improvises, of course. But he asks himself every time, “If I had to live with this for a long time, would I be willing to?”
And if the answer is “No,” he keeps on working to find a more general, a more conceptual, a more comprehensive solution— one which establishes the right principle.
As a result, the effective executive does not make many decisions. But the reason is not that he takes too long in making one—in fact, a decision on principle does not, as a rule, take longer than a decision on symptoms and expediency. The effective executive does not need to make many decisions. Because he solves generic situations through a rule and policy, he can handle most events as cases under the rule; that is, by adaptation. “A country with many laws is a country of incompetent lawyers,” says an old legal proverb. It is a country which attempts to solve every problem as a unique phenomenon, rather than as a special case under general rules of law. Similarly, an executive who makes many decisions is both lazy and ineffectual.
The decision-maker also always tests for signs that something atypical, 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—make automobile accidents disappear, for instance—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.
These are in essence the rules Hippocrates laid down for medical diagnosis well over 2,000 years ago. They are the rules for scientific observation first formulated by Aristotle and then reaffirmed by Galileo three hundred years ago. These, in other words, are old, well-known, time-tested rules, rules one can learn and can systematically apply. "
" 2. The second major element in the decision process is clear specifications as to what the decision has to accomplish. What are the objectives the decision has to reach? What are the minimum goals it has to attain? " (he calls these "boundary conditions"; i call them "specifications" or "axioms")
"The effective executive knows that a decision that does not satisfy the boundary conditions is ineffectual and inappropriate. It may be worse indeed than a decision that satisfies the wrong boundary conditions. Both will be wrong, of course. But one can salvage the appropriate decision for the incorrect boundary conditions. It is still an effective decision. One cannot get anything but trouble from the decision that is inadequate to its specifications. "
"
In fact, clear thinking about the boundary conditions is needed so that one knows when a decision has to be abandoned. There are two famous illustrations for this—one of a decision where the boundary conditions had become confused and one of a decision where they were kept so clear as to make possible immediate replacement of the outflanked decision by a new and appropriate policy. • The first example is the famous Schlieffen Plan of the German General Staff at the outbreak of World War I. This plan was meant to enable Germany to fight a war on both the eastern and the western fronts simultaneously without having to splinter her forces between East and West. To accomplish this, the Schlieffen Plan proposed to offer only token opposition to the weaker enemy, that is, to Russia, and to concentrate all forces first on a quick knockout blow against France, after which Russia would be dealt with. This, of course, implied willingness to let the Russian armies move fairly deeply into German territory at the outbreak of the war and until the decisive victory over France. But in August 1914, it became clear that the speed of the Russian armies had been underrated. The Junkers in East Prussia whose estates were overrun by the Russians set up a howl for protection.
Schlieffen himself had kept the boundary conditions clearly in his mind. But his successors were technicians rather than decision-makers and strategists. They jettisoned the basic commitment underlying the Schlieffen Plan, the commitment not to splinter the German forces. They should have dropped the plan. Instead they kept it but made its attainment impossible. They weakened the armies in the West sufficiently to deprive their initial victories of full impact, yet did not strengthen the armies in the East sufficiently to knock out the Russians. They thereby brought about the one thing the Schlieffen Plan had been designed to prevent: a stalemate with its ensuing war of attrition in which superiority of manpower, rather than superiority of strategy, eventually had to win. Instead of a strategy, all they had from there on was confused improvisation, impassioned rhetoric, and hopes for miracles. "
" But clear thinking about the boundary conditions is needed also to identify the most dangerous of all possible decisions: the one that might—just might—work if nothing whatever goes wrong. These decisions always seem to make sense. But when one thinks through the specifications they have to satisfy, one always finds that they are essentially incompatible with each other. That such a decision might succeed is not impossible—it is merely grossly improbable. The trouble with miracles is not, after all, that they happen rarely; it is that one cannot rely on them. "
(Bay of Pigs example) " ... The mistake was failure to think through clearly the boundary conditions that the decision had to satisfy, and refusal to face up to the unpleasant reality that a decision that has to satisfy two different and at bottom incompatible specifications is not a decision but a prayer for a miracle. "
" Yet, defining the specifications and setting the boundary conditions cannot be done on the “facts” in any decision of importance. It always has to be done on interpretation. It is risk-taking judgment.
Everyone can make the wrong decision—in fact, everyone will sometimes make a wrong decision. But no one needs to make a decision which, on its face, falls short of satisfying the boundary conditions. "
" 3. 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. But if one does not know what is right to satisfy the specifications and boundary conditions, one cannot distinguish between the right compromise and the wrong compromise—and will end up by making the wrong compromise. "
" For there are two different kinds of compromise. One kind is expressed in the old proverb: “Half a loaf is better than no bread.” The other kind is expressed in the story of the Judgment of Solomon, which was clearly based on the realization that “half a baby is worse than no baby at all.” In the first instance, the boundary conditions are still being satisfied. "
" It is fruitless and a waste of time to worry about what is acceptable and what one had better not say so as not to evoke resistance. The things one worries about never happen. And objections and difficulties no one thought about suddenly turn out to be almost insurmountable obstacles. One gains nothing in other words by starting out with the question: “What is acceptable?” And in the process of answering it, one gives away the important things, as a rule, and loses any chance to come up with an effective, let alone with the right, answer. "
" 4. Converting the decision into action is the fourth major element in the decision process. While 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. Yet a decision will not become effective unless the action commitments have been built into the decision from the start.
In fact, no decision has been made unless carrying it out in specific steps has become someone’s work assignment and responsibility. Until then, there are only good intentions. • This is the trouble with so many policy statements, especially of business: They contain no action commitment. To carry them out is no one’s specific work and responsibility. No wonder that the people in the organization tend to view these statements cynically if not as declarations of what top management is really not going to do.
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 the last of these are too often overlooked—with dire results.
• A story that has become a legend among operations researchers illustrates the importance of the question “Who has to know?” A major manufacturer of industrial equipment decided several years ago to discontinue one model. For years it had been standard equipment on a line of machine tools, many of which were still in use. It was decided, therefore, to sell the model to present owners of the old equipment for another three years as a replacement, and then to stop making and selling it. Orders for this particular model had been going down for a good many years. But they shot up as former customers reordered against the day when the model would no longer be available. No one had, however, asked, “Who needs to know of this decision?” Therefore nobody informed the clerk in the purchasing department who was in charge of buying the parts from which the model itself was being assembled. His instructions were to buy parts in a given ratio to current sales—and the instructions remained unchanged. When the time came to discontinue further production of the model, the company had in its warehouse enough parts for another eight to ten years of production, parts that had to be written off at a considerable loss.
The action must also be appropriate to the capacities of the people who have to carry it out. "
" All this becomes doubly important when people have to change behavior, habits, or attitudes if a decision is to become effective action. Here one has to make sure not only that responsibility for the action is clearly assigned and that the people responsible are capable of doing the needful. One has to make sure that their measurements, their standards for accomplishment, and their incentives are changed simultaneously. Otherwise, the people will get caught in a paralyzing internal emotional conflict.
• Theodore Vail’s decision that the business of the Bell System was service might have remained dead letter but for the yardsticks of service performance which he designed to measure managerial performance. Bell managers were used to being measured by the profitability of their units, or at the least, by cost. The new yardsticks made them accept rapidly the new objectives.
• In sharp contrast is the recent failure of a brilliant chairman and chief executive to make effective a new organization structure and new objectives in an old, large, and proud American company. Everyone agreed that the changes were needed. The company, after many years as leader of its industry, showed definite signs of aging; in almost all major fields newer, smaller, and more aggressive competitors were outflanking it. But to gain acceptance for the new ideas, the chairman promoted the most prominent spokesmen of the old school into the most visible and best-paid positions— especially into three new executive vice-presidencies. This meant only one thing to the people in the company: “They don’t really mean it.”
If the greatest rewards are given for behavior contrary to that which the new course of action requires, then everyone will conclude that this contrary behavior is what the people at the top really want and are going to reward. "
" think what action commitments a specific decision requires, what work assignments follow from it, and what people are available to carry it out. "
" 5. Finally, a feedback has to be built into the decision to provide a continuous testing, against actual events, of the expectations that underlie the decision.
Decisions are made by men. Men are fallible; at their best their works do not last long. Even the best decision has a high probability of being wrong. Even the most effective one eventually becomes obsolete. "
" When General Eisenhower was elected president, his predecessor, Harry S. Truman, said: “Poor Ike; when he was a general, he gave an order and it was carried out. Now he is going to sit in that big office and he’ll give an order and not a damn thing is going to happen.” The reason why “not a damn thing is going to happen” is, however, not that generals have more authority than presidents. It is that military organizations learned long ago that futility is the lot of most orders and organized the feedback to check on the execution of the order. They learned long ago that to go oneself and look is the only reliable feedback.* Reports—all a president is normally able to mobilize—are not much help. All military services have long ago learned that the officer who has given an order goes out and sees for himself whether it has been carried out. At the least he sends one of his own aides—he never relies on what he is told by the subordinate to whom the order was given. Not that he distrusts the subordinate; he has learned from experience to distrust communications.
• This is the reason why a battalion commander is expected to go out and taste the food served his men. He could, of course, read the menus and order this or that item to be brought in to him. But no; he is expected to go into the mess hall and take his sample of the food from the same kettle that serves the enlisted men. "
"
With the coming of the computer this will become even more important, for the decision-maker will, in all likelihood, be even further removed from the scene of action "
" Failure to go out and look is the typical reason for persisting in a course of action long after it has ceased to be appropriate or even rational. "
"[tackle] a problem at the highest conceptual level of understanding. [first, try] to think through what the decision was all about, and [only] then [try] to develop a principle for dealing with it...one has to start with what is right rather than what is acceptable (let alone who is right) precisely because one always has to compromise in the end."
" A decision is a judgment. It is a choice between alternatives. It is rarely a choice between right and wrong. It is at best a choice between “almost right” and “probably wrong”—but much more often a choice between two courses of action neither of which is provably more nearly right than the other.
Most books on decision-making tell the reader: “First find the facts.” But executives who make effective decisions know that one does not start with facts. One starts with opinions. These are, of course, nothing but untested hypotheses and, as such, worthless unless tested against reality. To determine what is a fact requires first a decision on the criteria of relevance, especially on the appropriate measurement. This is the hinge of the effective decision, and usually its most controversial aspect.
Finally, the effective decision does not, as so many texts on decision-making proclaim, flow from a consensus on the facts. The understanding that underlies the right decision grows out of the clash and conflict of divergent opinions and out of the serious consideration of competing alternatives.
To get the facts first is impossible. There are no facts unless one has a criterion of relevance. Events by themselves are not facts.
But the effective executive also knows that people do not start out with the search for facts. They start out with an opinion. There is nothing wrong with this. People experienced in an area should be expected to have an opinion. Not to have an opinion after having been exposed to an area for a good long time would argue an unobservant eye and a sluggish mind.
People inevitably start out with an opinion; to ask them to search for the facts first is even undesirable. They will simply do what everyone is far too prone to do anyhow: look for the facts that fit the conclusion they have already reached. And no one has ever failed to find the facts he is looking for. The good statistician knows this and distrusts all figures—he either knows the fellow who found them or he does not know him; in either case he is suspicious.
The only rigorous method, the only one that enables us to test an opinion against reality, is based on the clear recognition that opinions come first—and that this is the way it should be. Then no one can fail to see that we start out with untested hypotheses—in decision-making as in science the only starting point. We know what to do with hypotheses—one does not argue them; one tests them. One finds out which hypotheses are tenable, and therefore worthy of serious consideration, and which are eliminated by the first test against observable experience.
The effective executive encourages opinions. But he insists that the people who voice them also think through what it is that the “experiment”—that is, the testing of the opinion against reality—would have to show. The effective executive, therefore, asks: “What do we have to know to test the validity of this hypothesis?” “What would the facts have to be to make this opinion tenable?” And he makes it a habit—in himself and in the people with whom he works—to think through and spell out what needs to be looked at, studied, and tested. He insists that people who voice an opinion also take responsibility for defining what factual findings can be expected and should be looked for.
Perhaps the crucial question here is: “What is the criterion of relevance?”
The effective decision-maker assumes that the traditional measurement is not the right measurement. Otherwise, there would generally be no need for a decision; a simple adjustment would do. The traditional measurement reflects yesterday’s decision. That there is need for a new one normally indicates that the measurement is no longer relevant.
The best way to find the appropriate measurement is again to go out and look for the “feedback” discussed earlier—only this is “feedback” before the decision.
• In most personnel matters, for instance, events are measured in “averages,” such as the average number of lost-time accidents per hundred employees, the average percentage of absenteeism in the whole work force, or the average illness rate per hundred. But the executive who goes out and looks for himself will soon find that he needs a different measurement. The averages serve the purposes of the insurance company, but they are meaningless, indeed misleading, for personnel management decisions.
The great majority of all accidents occur in one or two places in the plant. The great bulk of absenteeism is in one department. Even illness resulting in absence from work, we now know, is not distributed as an average, but is concentrated in a very small part of the work force, e.g., young unmarried women. The personnel actions to which dependence on the averages will lead—for instance, the typical plantwide safety campaign—will not produce the desired results, may indeed make things worse.
Similarly, failure to go and look was a major factor in the failure of the automobile industry to realize in time the need for safety engineering of the car. The automobile companies measured only by the conventional averages of number of accidents per passenger mile or per car. Had they gone out and looked, they would have seen the need to measure also the severity of bodily injuries resulting from accidents. And this would soon have highlighted the need to supplement their safety campaigns by measures aimed at making the accident less dangerous; that is, by automotive design.
Finding the appropriate measurement is thus not a mathematical exercise. It is a risk-taking judgment.
Whenever one has to judge, one must have alternatives among which one can choose. A judgment in which one can only say “yes” or “no” is no judgment at all. Only if there are alternatives can one hope to get insight into what is truly at stake.
Effective executives therefore insist on alternatives of measurement—so that they can choose the one appropriate one.
• There are a number of measurements for a proposal on a capital investment. One of these focuses on the length of time it will take before the original investment has been earned back. Another one focuses on the rate of profitability expected from the investment. A third one focuses on the present value of the returns expected to result from the investment, and so on. The effective executive will not be content with any one of these conventional yardsticks, no matter how fervently his accounting department assures him that only one of them is “scientific.” He knows, if only from experience, that each of these analyses brings out a different aspect of the same capital investment decision. Until he has looked at each possible dimension of the decision, he cannot really know which of these ways of analyzing and measuring is appropriate to the specific capital decision before him. Much as it annoys the accountants, the effective executive will insist on having the same investment decision calculated in all three ways—so as to be able to say at the end: “This measurement is appropriate to this decision.”
This, above all, explains why effective decision-makers deliberately disregard the second major command of the textbooks on decision-making and create dissension and disagreement, rather than consensus.
Decisions of the kind the executive has to make are not made well by acclamation. They are made well only if based on the clash of conflicting views, the dialogue between different points of view, the choice between different judgments. The first rule in decision-making is that one does not make a decision unless there is disagreement.
• Alfred P. Sloan is reported to have said at a meeting of one of his top committees: “Gentlemen, I take it we are all in complete agreement on the decision here.” Everyone around the table nodded assent. “Then,” continued Mr. Sloan, “I propose we postpone further discussion of this matter until our next meeting to give ourselves time to develop disagreement and perhaps gain some understanding of what the decision is all about.”
Sloan was anything but an “intuitive” decision-maker. He always emphasized the need to test opinions against facts and the need to make absolutely sure that one did not start out with the conclusion and then look for the facts that would support it. But he knew that the right decision demands adequate disagreement.
Every one of the effective Presidents in American history had his own method of producing the disagreement he needed in order to make an effective decision. Lincoln, Theodore Roosevelt, Franklin D. Roosevelt, Harry Truman—each had his own ways. But each created the disagreement he needed for “some understanding of what the decision is all about.” Washington, we know, hated conflicts and quarrels and wanted a united Cabinet. Yet he made quite sure of the necessary differences of opinion on important matters by asking both Hamilton and Jefferson for their opinions.
• The President who understood best the need for organized disagreement was probably Franklin D. Roosevelt. Whenever anything of importance came up, he would take aside one of his aides and say to him, “I want you to work on this for me—but keep it a secret.” (This made sure, as Roosevelt knew perfectly well, that everybody in Washington heard about it immediately.) Then Roosevelt would take aside a few other men, known to differ from the first and would give them the same assignment, again “in the strictest confidence.” As a result, he could be reasonably certain that all important aspects of every matter were being thought through and presented to him. He could be certain that he would not become the prisoner of somebody’s preconceived conclusions.
This practice was severely criticized as execrable administration by the one “professional manager” in Roosevelt’s Cabinet, his secretary of the Interior, Harold Ickes, whose diaries are full of diatribes against the President’s “sloppiness,” “indiscretions,” and “treachery.” But Roosevelt knew that the main task of an American President is not administration. It is the making of policy, the making of the right decisions. And these are made best on the basis of “adversary proceedings” to use the term of the lawyers for their method of getting at the true facts in a dispute, and of making sure that all relevant aspects of a case are presented to the court.
There are three main reasons for the insistence on disagreement.
It is, first, the only safeguard against the decision-maker’s becoming the prisoner of the organization. Everybody always wants something from the decision-maker. Everybody is a special pleader, trying—often in perfectly good faith—to obtain the decision he favors. This is true whether the decision-maker is the President of the United States or the most junior engineer working on a design modification.
The only way to break out of the prison of special pleading and preconceived notions is to make sure of argued, documented, thought-through disagreements.
Second, disagreement alone can provide alternatives to a decision. And a decision without an alternative is a desperate gambler’s throw, no matter how carefully thought through it might be. There is always a high possibility that the decision will prove wrong—either because it was wrong to begin with or because a change in circumstances makes it wrong. If one has thought through alternatives during the decision-making process, one has something to fall back on, something that has already been thought through, that has been studied, that is understood. Without such an alternative, one is likely to flounder dismally when reality proves a decision to be inoperative.
Above all, disagreement is needed to stimulate the imagination. One does not, to be sure, need imagination to find the right solution to a problem. But then this is of value only in mathematics. In all matters of true uncertainty such as the executive deals with—whether his sphere is political, economic, social, or military—one needs “creative” solutions which create a new situation. And this means that one needs imagination—a new and different way of perceiving and understanding.
Imagination of the first order is, I admit, not in abundant supply. But neither is it as scarce as is commonly believed. Imagination needs to be challenged and stimulated, however, or else it remains latent and unused. Disagreement, especially if forced to be reasoned, thought through, documented, is the most effective stimulus we know.
The effective decision-maker, therefore, organizes disagreement. This protects him against being taken in by the plausible but false or incomplete. It gives him the alternatives so that he can choose and make a decision, but also so that he is not lost in the fog when his decision proves deficient or wrong in execution. And it forces the imagination—his own and that of his associates. Disagreement converts the plausible into the right and the right into the good decision.
The effective decision-maker does not start out with the assumption that one proposed course of action is right and that all others must be wrong. Nor does he start out with the assumption, “I am right and he is wrong.” He starts out with the commitment to find out why people disagree.
Effective executives know, of course, that there are fools around and that there are mischief-makers. But they do not assume that the man who disagrees with what they themselves see as clear and obvious is, therefore, either a fool or a knave. They know that unless proven otherwise, the dissenter has to be assumed to be reasonably intelligent and reasonably fair-minded. Therefore, it has to be assumed that he has reached his so obviously wrong conclusion because he sees a different reality and is concerned with a different problem. The effective executive, therefore, always asks: “What does this fellow have to see if his position were, after all, tenable, rational, intelligent?” The effective executive is concerned first with understanding. Only then does he even think about who is right and who is wrong.*
In a good law office, the beginner, fresh out of law school, is first assigned to drafting the strongest possible case for the other lawyer’s client.
... No matter how high his emotions run, no matter how certain he is that the other side is completely wrong and has no case at all, the executive who wants to make the right decision forces himself to see opposition as his means to think through the alternatives. He uses conflict of opinion as his tool to make sure all major aspects of an important matter are looked at carefully. "
" There is one final question the effective decision-maker asks: “Is a decision really necessary?” One alternative is always the alternative of doing nothing.
Every decision is like surgery. It is an intervention into a system and therefore carries with it the risk of shock. ... One has to make a decision when a condition is likely to degenerate if nothing is done. This also applies with respect to opportunity. If the opportunity is important and is likely to vanish unless one acts with dispatch, one acts—and one makes a radical change.
At the opposite end there are those conditions in respect to which one can, without being unduly optimistic, expect that they will take care of themselves even if nothing is done. If the answer to the question “What will happen if we do nothing?” is “It will take care of itself,” one does not interfere. Nor does one interfere if the condition, while annoying, is of no importance and unlikely to make any difference anyhow.
• It is a rare executive who understands this. The controller who in a desperate financial crisis preaches cost reduction is seldom capable of leaving alone minor blemishes, elimination of which will achieve nothing. He may know, for instance, that the significant costs that are out of control are in the sales organization and in physical distribution. And he will work hard and brilliantly at getting them under control. But then he will discredit himself and the whole effort by making a big fuss about the “unnecessary” employment of two or three old employees in an otherwise efficient and well-run plant. And he will dismiss as immoral the argument that eliminating these few semipensioners will not make any difference anyhow. “Other people are making sacrifices,” he will argue, “Why should the plant people get away with inefficiency?”
When it is all over, the organization will forget fast that he saved the business. They will remember, though, his vendetta against the two or three poor devils in the plant— and rightly so. “De minimis non curat praetor” [The magistrate does not consider trifles] said the Roman law almost two thousand years ago—but many decision-makers still need to learn it. "
[note: rework disagrees; it says to make decisions. that alternative process for workplaces, i forgot its name, agrees; it says to postpone committment when possible (but to try things out immediately); but this "try things out" probably disagrees with Drucker about making decisions on the highest conceptual level, rather than always only making adaptations]
" The great majority of decisions will lie between these extremes. The problem is not going to take care of itself; but it is unlikely to turn into degenerative malignancy either. The opportunity is only for improvement rather than for real change and innovation; but it is still quite considerable. If we do not act, in other words, we will in all probability survive. But if we do act, we may be better off.
In this situation the effective decision-maker compares effort and risk of action to risk of inaction. There is no formula for the right decision here. But the guidelines are so clear that decision in the concrete case is rarely difficult. They are:
• Act if on balance the benefits greatly outweigh cost and risk; and
• Act or do not act; but do not “hedge” or compromise. "
" The decision is now ready to be made. The specifications have been thought through, the alternatives explored, the risks and gains weighed. Everything is known. Indeed, it is always reasonably clear by now what course of action must be taken. At this point the decision does indeed almost “make itself.”
And it is at this point that most decisions are lost. It becomes suddenly quite obvious that the decision is not going to be pleasant, is not going to be popular, is not going to be easy. It becomes clear that a decision requires courage as much as it requires judgment. .... One thing the effective executive will not do at this point. He will not give in to the cry, “Let’s make another study.” This is the coward’s way—and all the coward achieves is to die a thousand deaths where the brave man dies but one. When confronted with the demand for “another study” the effective executive asks: “Is there any reason to believe that additional study will produce anything new? And is there reason to believe that the new is likely to be relevant?”. "
" But at the same time he will not rush into a decision unless he is sure he understands it. Like any reasonably experienced adult, he has learned to pay attention to what Socrates called his “daemon”: the inner voice, somewhere in the bowels, that whispers, “Take care.” Just because something is difficult, disagreeable, or frightening is no reason for not doing it if it is right. But one holds back—if only for a moment—if one finds oneself uneasy, perturbed, bothered without quite knowing why. “I always stop when things seem out of focus,” is the way one of the best decision-makers of my acquaintance puts it.
Nine times out of ten the uneasiness turns out to be over some silly detail. But the tenth time one suddenly realizes that one has overlooked the most important fact in the problem, has made an elementary blunder, or has misjudged altogether...
But the effective decision-maker does not wait long—a few days, at the most a few weeks. If the “daemon” has not spoken by then, he acts with speed and energy whether he likes to or not.
Executives are not paid for doing things they like to do. They are paid for getting the right things done—most of all in their specific task, the making of effective decisions. "
" the computer will force executives to make, as true decisions, what are today mostly made as on-the-spot adaptations. It will convert a great many people who traditionally have reacted rather than acted into genuine executives and decision-makers.
... • A simple and a common area where the typical traditional manager acts by way of on-the-spot adaptation is the commonplace inventory and shipping decision. The typical district sales manager knows, albeit most inaccurately, that customer A usually runs his plant on a tight schedule and would be in real trouble if a promised delivery did not arrive on time. He knows also that customer B usually has adequate inventories of materials and supplies and can presumably manage to get by for a few days even if a delivery were late. He knows that customer C is already annoyed at his company and is only waiting for a pretext to shift his purchases to another supplier. He knows that he can get additional supplies of one item by asking for them as a special favor from this or that man in the plant back home, and so on. And on the basis of these experiences, the typical district sales manager adapts and adjusts as he goes along.
The computer knows none of these things. ... The moment a company tries to put inventory control on the computer, it realizes that it has to develop rules. It has to develop an inventory policy. As soon as it tackles this, it finds that the basic decisions in respect to inventory are not inventory decisions at all. They are highly risky business decisions. Inventory emerges as a means of balancing different risks: the risk of disappointing customer expectations in respect to delivery and service; the risk and cost of turbulence and instability in manufacturing schedules; and the risk and cost of locking up money in merchandise which might spoil, become obsolete, or otherwise deteriorate.
• The traditional cliches do not greatly help. “It is our aim to give 90 per cent of our customers 90 per cent fulfillment of delivery promises” sounds precise. It is actually meaningless, as one finds out when one tries to convert it into the step-by-step moron logic of the computer. Does it mean that all our customers are expected to get nine out of ten orders when we promised them? Does it mean that our really good customers should get fulfillment all the time on all their orders—and how do we define a “really good customer” anyhow? Does it mean that we aim to give fulfillment of these promises on all our products? or only on the major ones which together account for the bulk of our production? And what policy, if any, do we have with respect to the many hundreds of products which are not major for us, though they might well be major for the customer who orders one of them?
Each of these questions requires a risk-taking decision and, above all, a decision on principle. Until all these decisions have been made, the computer cannot control inventory. They are decisions of uncertainty—and what is relevant to them could not even be defined clearly enough to be conveyed to the computer.
... As a result, decision-making can no longer be confined to the very small group at the top. In one way or another almost every knowledge worker in an organization will either have to become a decision-maker himself or will at least have to be able to play an active, an intelligent, and an autonomous part in the decision-making process. What in the past had been a highly specialized function, discharged by a small and usually clearly defined organ—with the rest adapting within a mold of custom and usage—is rapidly becoming a normal if not an everyday task of every single unit in this new social institution, the large-scale knowledge organization. "
and this is great:
" The sooner operating managers learn to make decisions as genuine judgments on risk and uncertainty, the sooner we will overcome one of the basic weaknesses of large organization—the absence of any training and testing for the decision-making top positions. "
"The computer might also change one of the typical mistakes in decision-making. Traditionally we have tended to err toward treating generic situations as a series of unique events. Traditionally we have tended to doctor symptoms. The computer, however, can only handle generic situations—this is all logic is ever concerned with. Hence we may well in the future tend to err by handling the exceptional, the unique, as if it were a symptom of the generic. "
" There is nothing exalted about being an effective executive. It is simply doing one’s job like thousands of others. There is little danger that anyone will compare this essay on training oneself to be an effective executive with, say, Kierkegaard’s great self-development tract, Training in Christianity. There are surely higher goals for a man’s life than to become an effective executive. But only because the goal is so modest can we hope at all to achieve it; that is, to have the large number of effective executives modern society and its organizations need. If we required saints, poets, or even first-rate scholars to staff our knowledge positions, the large-scale organization would simply be absurd and impossible. The needs of large-scale organization have to be satisfied by common people achieving uncommon performance. "
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Even more important is the social need for executive effectiveness. The cohesion and strength of our society depend increasingly on the integration of the psychological and social needs of the knowledge worker with the goals of organization and of industrial society.
The knowledge worker['s] .... psychological needs and personal values need to be satisfied in and through his work and position in the organization. He is considered and considers himself a professional. Yet he is an employee and under orders. He is beholden to a knowledge area, yet he has to subordinate the authority of knowledge to organizational objectives and goals. In a knowledge area there are no superiors or subordinates, there are only older and younger men. Yet organization requires a hierarchy. These are not entirely new problems, to be sure. Officer corps and civil service have known them for a long time, and have known how to resolve them. But they are real problems. The knowledge worker is not poverty-prone. He is in danger of alienation, to use the fashionable word for boredom, frustration, and silent despair.
Just as the economic conflict between the needs of the manual worker and the role of an expanding economy was the social question of the nineteenth century in the developing countries, so the position, function and fulfillment of the knowledge worker is the social question of the twentieth century in these countries now that they are developed.
It is not a question that will go away if we deny its existence. To assert (as do in their own way both orthodox economists and Marxists) that only the objective reality of economic and social performance exists will not make the problem go away. Nor, however, will the new romanticism of the social psychologists (e.g., Professor Chris Argyris at Yale) who quite rightly point out that organizational goals are not automatically individual fulfillment and therefrom conclude that we had better sweep them aside. We will have to satisfy both the objective needs of society for performance by the organization, and the needs of the person for achievement and fulfillment.
Self-development of the executive toward effectiveness is the only available answer. It is the only way in which organization 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. He works at making his knowledge area become organizational opportunity. And by focusing on contribution, he makes his own values become organization results. " -- Peter F Drucker, The Effective Executive
