Library

The Effective Executive

author: & Peter Drucker
Date finished: 20210806
status: #notesInProgress
tags: #productivity #leadership #business

p93

Above all, the effective executive tries to make fully productive the strengths of his own superior.
? 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?

• reference to 202108012035 - Play the Long Game

  • It enables him to achieve and accomplish the things he himself believes in

• 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.

p94

• To make the boss effective requires focus on his strengths and on what he can do - building on strength to make weaknesses irrelevant.

Making yourself Effective

• Effective executives lead from strength in their own work.
  • 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.

p96

• The assertion that "somebody else will not let me do anything" should always be suspected as a cover-up for inertia.
• The effective executive starts out with the question: "What can I do?" to find that he can actually do much more than he has time and resources for.

p97

• (cont. of 96) How people work best (working from rough notes, an outline, having a lot of time, having a deadline, being a reader or a listener) All this one knows, about oneself—just as one knows whether one is right-handed or left-handed.

• These work habits are a source of effectiveness. The effective executive knows this and acts thoroughly.

• The effective executive tries to be himself, he does not pretend to be someone else

  What are things that I seem to be able to do with relative ease, while they come rather hard to other people?"

p98

• (cont. of 97) To be effective he builds on what he know he can do and does it the way he has found out he works best.
  • If one disciplines oneself to ask about one's associates "What can this man do?" rather than "What can he not do?" one soon will acquire the attitude of looking for strength and using strength.
    • Eventually one will learn to ask this question of oneself.
• In every area of effectiveness within an organization, one feeds the opportunities and starves the problems. 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 strengths.

First Things First

Effective executives do first things first and they do one thing at a time
- 202108012054 - Prioritize and Execute

• The more an executive focuses on upward contribution, the more will he require fairly big continuous chunks of time. The more he switches from being busy to achieving results, the more will he shift to sustained efforts- efforts which require a fairly big quantum of time to bear fruit. Yet to get even that half-day or those two weeks of really productive times requires self-discipline and an iron determination to say no. (finding some correlation to deep work and saying no to things)
  • looking up and out instead of down and in
• Doing one thing at a time means doing it fast. The more one can concentrate time, effort, and resources, the greater the number of diversity of tasks one can actually perform._

p103

-Effective executives do not race. They set an easy page but keep going steadily.

p104 - Sloughing off yesterday

• Yesterday's successes, however, always linger on long beyond their productive life. (nick saban always moving ahead after winning a national championship)
• The executive asks: "Is this still worth doing?"
  • if it isn't, he gets rid of it so as to be able to concentrate on the few tasks that will really make a difference in the results of his own job and in the performance of his organization.

p107

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.

p110 - What one postpones, one actually abandons

• 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.
  • To do 5 years later what it would have been smart to do five years earlier is almost a sure recipe for frustration and failure.

p111 - Identifying priorities and executing

• What one has relegated may turn out to be the competitor's triumph.
• 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 make everybody happy. The only drawback is, of course, that nothing whatever gets done.
• Courage rather than analysis dictates the truly important rules for identifying priorities
  1. Pick the future as against the past;
  2. Focus on opportunity rather than on problem;
  3. Choose your own direction-rather than climb on the bandwagon;
  4. Aim high, aim for something that will make a difference, rather than for something that is safe and easy to do

p112

• Achievement depends less on ability in doing research than on the courage to go after opportunity.
• It is more productive to convert an opportunity into results than to solve a problem-which only restores the equilibrium of yesterday.

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 decisions as to what really matters and comes first—is the execited's only hope of becoming the master of time and events instead of their whipping boy.

The Elements of Decision-making

• Effective executives make effective decisions as a systematic process with clearly defined elements and in a distinct sequence of steps.
  • (They) do not make a great many decisions. They concentrate on the important ones. They try to thing through what is strategic and generic, rather than "solve problems." They try to make a few important decisions on the highest level of conceptual understanding.

p114

They) know that the most time-consuming step in the process of making decisions is not making the decision, but putting in into effect.

• This means that, which 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 202108012053 - Simple as possible.

p115 - Case studies in Decision Making

• Four strategic decisions { Theodore Vail made in the course of twenty years with the Bell Telephone System

  1. "Our business is service"
     1. Managers are responsible for service results. It is then the job of top level management to organize and finance the company so as to make the best service also result in optimal financial rewards
  2. Setting the Bell Telephone System the objective of making regulation effective
     1. Innovate concepts of regulation and of rate-making that would be fair and equitable and would protect the public, while at the same time permitting the Bell System to do its job.
  3. Establish one of the most successful scientific laboratories in industry, the 202201100932 - Bell Labratories

     1. How can one make such a monopoly truly competitive?

        1. One can organize the future to compete with the present.
           1. The future lies in better and different technologies.
        2. Bell Labs first extended telephone technology so that the entire North American continent became one automated switchboard
           1. the transmission of tv programs, computer data, communication satellites
  4. The AT&T common stock
     1. with it's almost guaranteed dividend, this common was close enough to a fixed interest-bearing obligation for widows and orphans to buy it. At the same time it was a common share so that it held out the promise of capital appreciation and of protection of inflation.

Alfred P. Sloan, CEO of GM

• GM a loose federation of almost independent chieftains
• Problem: The big business needs unity of direction and central control.
• Solution: Decentralization which balances local autonomy in operations with central control of direction and policy
  • The operating managers have to have the freedom to do things their own way. They have to have responsibility and the authority that goes with it. THey have to have scope to show what they can do, and they have to get recognition for performance.

p121 Common features of Vail and Sloan's decisions

• They tried to think through what the decision was all about, and then tried to develop a principle for dealing with it.
• Their decisions were strategic rather than adaptations to the apparently needs of the moment. They all innovated.
• They were all highly controversial. They went directly contrary to what "everybody knew."

p122

The Elements of the Decision Process

1. The clear realization that the problem was generic and could only be solved through a decision which established a rule, a principle.

   1. "Is this a generic something that underlies a great many occurrences?"

      1. The generic always has to be answered through a rule, a principle.
      2. Process control will spend a tremendous amount of time fixing leaks without ever getting control of the situation

   2. "Is the occurrence a unique event that needs to be dealt with as such?"

      1. Look to the experience of others to make a decision

   3. A truly exceptional event

      1. "Is this a true exception or only the first manifestation of a new genus?"

   • All events but the truly unique require a generic solution

     1. They require a rule, a policy, a principle.
     2. Pragmatism: The refusal to develop rule and principles, and its insistence of treating everything "on its merits."
     3. The effective decision maker always assumes initially that the problem is generic.

- The effective decision maker always tries to put his solution on the highest possible conceptual level.
- "If I had to live with this for a long time, would I be willing to?"
- 1. If the answer is no: he keeps on working to find a more general solution-one which established the right principle
- "A country with many laws is a country of incompetent lawyers."
- An executive who makes many decisions is both lazy and ineffectual.
- Rules that & Hippocrates spoke on
2. The definition of the specifications which the answer to the problem had to satisfy, that is, of the "boundary conditions."
1. Clear specifications as to what the decision has to accomplish
1. The more concisely and clearly boundary conditions are stated, the greater likelihood that the decisions will indeed be an effective one and will accomplish what it set out to do.
2. Boundary conditions: "What is the minimum needed to resolve this problem?"
3. The effective executive knows that a decision that does not satisfy the boundary conditions is ineffectual and inappropriate
4. 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 interpretations. It is a risk-taking judgment
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
1. 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 making the wrong compromise.
> "My only instruction to you is to put down what you think is right as you see it. Don't worry about out reaction. Don't worry about whether we will like this or dislike that. And about all, don't concern yourself with the compromises that might be needed to make your recommendations acceptable. **Not one executive (at GM) can make the right compromise unless you first tell him what 'right' is."
— Alfred P. Sloan to Peter Drucker
2. 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.
4. The building into the decision of the action to carry it out
1. The conversion of decision into action requires answering several distinct questions:
1. Who has to know of this decision?
2. What action has to be taken?
3. Who is to take it?
4. What does the action have to be so the people who have to do it can do it

• This is the trouble with so many policy statements: They contain no action commitment.
• The action must be appropriate to the capacities of the people who have to carry it out

  • What kind of people do we have available to make this decision effective? and what can they do?

• 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 going to reward.

5. The "feedback" which tests the validity and effectiveness of the decision against the actual course of events.
   • An officer who has given an order goes out and sees for himself whether it has been carried out. { Leadership, Strategies, and Tactics#^50e25e
   • Reality never stands for very long.
   • Even the most effective decision eventually becomes obsolete.

Effective Decisions

p143

• Executives who make effective decisions know that one does not start with facts. One starts with opinions (As it relates to "say what you think is right{ The Effective Executive - The Definitive Guide to Getting the Right Things Done#^211459")

• The only rigorous method 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.

  • 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?"

p147 - "What is the criterion of relevance?"

This question turns on the measurement appropriate to the matter under discussion and the decision to be reached."

• The effective decision maker assumes that the traditional measurement is not the right measurement.
  - #comment By combining 202108012141 - The Law of the Vital Few with defining "the criterion of relevance," a decision maker can develop a plan or strategic objective (ex. which clients take up most time for least return vs. clients that take up least amount of time for highest return.)

Finding the appropriate measurement is not a mathematical exercise. It is a risk-taking judgment

• Until he has looked at each possible dimension of the decision, decision maker cannot really know which of these ways of analyzing and measuring is appropriate to the specific capital decision before him.

p148

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

Rules of Decision Making

1. One does not make a decision unless their is disagreement (ex. Sloan)

   "Gentlemen, I take it we are all in complete agreement here." "I propose we postpone further discussion of this matter until out next meeting to give ourselves time to develop disagreement and perhaps gain some understanding of what the decision is all about."

   1. There are 3 main reasons for the insistence on disagreement
      1. Safeguard against the decision-maker's becoming the prisoner of the organization.
      2. Disagreement alone can provide alternatives to a decision. And a decision without and alternative is a desperate gambler's throw.
         • Redundancies found in the marines
2. Disagreement is needed to stimulate the imagination

   1. If forced to be reasoned, thought through, and documented, Disagreement is the most effective stimulus we know.

   2. Unless we turn the tap, imagination will not flow. The tap is argued disciplined agreement

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

• ...Unless proven otherwise, the dissenter has to be assumed to be reasonably intelligent and reasonably fair-minded.

  What does this fellow have to see if his position were, after all tenable, rational, intelligent?

p154

The effective Executive is concerned with the understanding. Only then does he even think about who is right and who is wrong
- Rephrasing of & Mary Parker Follet,{ Dynamic Administration - an extension of & Plato's arguments in his dialogue on rhetoric, the { Phaedrus.

• In teaching a beginner, law offices assign fresh undergrads with drafting the strongest possible case for the opponent.
  • It trains him not to start out with, "I know why my case is right," but with thinking through what it is that the other side must know, see or take as probably to believe that it has a case at all.

p155 - Making the right decision

• 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.

  • helps a leader looking up and out instead of down and in.

• There is one final question the effective decision-maker asks: "Is a decision really necessary?"

  • One alternative is always the alternative of doing nothing.

    • #comment Leadership strategies as they relate to doing nothing as a strategy.
    • If the opportunity is important and is very likely to vanish unless one acts with dispatch, one acts-and one makes radical change.

p156

• 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.

p157 - Guidelines: Should I Act?

• 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.
  1. Act if on balance the benefits greatly outweigh cost and risk
  2. Act or do not act; but do not "hedge" or compromise (Half Action).
     1. Ex. You wouln't take out half a tonsil, or half of an appendix
     2. This is a sure way not to satisfy the minimum 202108071531 - Boundary Conditions.

• 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 requites courage as much as it requires judgment. There is no inherent reason why medicines should taste horrible-but effective ones usually do. Similarly, there is not inherent reason why decisions should be distasteful—but effective ones are.

p158

• 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? Is there reason to believe that the new is likely to be relevant?"
  • If the answer is "no"—as it usually is—the effective executive does not permit another study. He does not waste the time of good people to cover up his own indecision.
• 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.

p159 - Decision making the computer

• Like all tools that do better something man can do, the computer multiplies man's capacity
  • The wheel, the airplane, or the television set that do something man cannot do at all, add a dimension to man. 202107301043 - The four categories of technology#^e6f88f
  • Computers rely on logic vs. Man is perceptible, therefore adaptable.
  • A computer cannot make sense of perceptible adaptations unless specifically told that they are facts.
    • Lead to development of rules and policies

p162

• The computer, being a tool, is probably not the cause of anything. It only brings out in sharp relief what has been happening all along.
• 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 plan an active, an intelligent, and an autonomous part in the decision making process.

p164

• In the future, we may tend to err by handling the exceptional, the unique, as if it were a symptom of the generic.
• The computer will, of course, no more make decision-makers out of clerks than the slide rule makes a mathematician out of a high school student.