• December 5, 2017

Management Classic Relevant Today — In Its 50th Year

Management Classic Relevant Today — In Its 50th Year

Management Classic Relevant Today — In Its 50th Year 1024 683 Opportunity Into Revenue

Only a few business management books still ring true after 10 years, much less 50 years.  But The Effective Executive, by Peter Drucker is still a relevant, concise, and compelling guide for any key member of an organization.  First published in 1967, this book, still in print, is now 50 years old.  It is worth your time because its guidance is timeless, valuable, and practical.

Jeff Bezos, founder of Amazon, has listed The Effective Executive as one of  three business books he recommends.  As the Wikipedia article on Peter Drucker states, “His books were filled with lessons on how organizations can bring out the best in people …”

2 Concepts

Two underlying concepts for the book are cogently summarized:  “This book rests on two premises:

  1. The executive’s job is to be effective; and 2. Effectiveness can be learned…. Effectiveness is, after all, not a ‘subject,’ but a self-discipline.”

How does Drucker define “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.”  So this book is relevant to many of us, not just senior managers, who are typically considered “executives.”

Why focus on effectiveness?  “Intelligence, imagination, and knowledge are essential resources, but only effectiveness converts them into results.”

How is effectiveness defined?  “Effectiveness …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 exceedingly hard to do well.”

5 Key Practices

The heart of this book focuses on 5 key practices, with a full chapter devoted to each.

  1. Use time effectively. It’s the only resource that can’t be replenished.  And too much of it is wasted on stuff that really doesn’t matter.
  2. Focus on outward contribution, specifically to results expected of the executive, rather than on your activity, effort, and work volume.
  3. Build on strengths – your own strengths, the strengths of your superiors, your colleagues and your subordinates. Focus on and leverage what they can do.
  4. Concentrate on the few major areas where superior performance will produce outstanding results. Set priorities and consistently execute on them.
  5. Make effective decisions. This includes the right steps in the right sequence.  Avoid making decisions fast because rushed decisions are often wrong.  Success often hinges on a few, but fundamental decisions.

Decision Making

Chapter 6, “The Elements of Decision-Making” should be highlighted and kept at hand for anyone making substantive decisions.  It presents a process that can be widely applied.

  1. Is this a generic situation or a “one off?” Generic situations must be addressed by a rule or principle.  Drucker writes:  “… the most common mistake is to treat a generic situation as if it were a series of unique events … this inevitably leads to frustration and futility.”  Develop a solution at the highest possible conceptual level, making it applicable to other cases of the generic situation.
  2. Be clear about the objectives of the decision. What are the minimum goals it must meet?  What are the “boundary conditions” it must satisfy?  “…any serious shortfall in defining these boundary conditions is almost certain to make a decision ineffectual, not matter how brilliant it may seem.”
  3. Start out with what is right, rather than with what is acceptable. Compromise may be necessary in the end.  But “(you) can’t make the ‘right’ compromise without knowing what ‘right’ is.”
  4. Convert the decision into action. “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.”
  5. Feedback must be monitored by continuous testing, against actual events, of the decision expectations. “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.”

Drucker also provides valuable guidance on making tough calls:  “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. … 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.”

Effective executives are proactive, not reactive.  They make thoughtful choices, then relentlessly execute them.  Drucker’s charge is typically direct:  “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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