The Effective Executive by Peter Drucker

These are my personal notes that I have taken while reading The Effective Executive by Peter Drucker.

This isn’t meant to be a Cliff Notes version or a substitute for reading the book. Especially important things are highlighted. I chose to read this book since it’s one of three books Jeff Bezos makes all of his top execs read.

Additional notes I’ve taken while reading other books can be found here.

Effectiveness can be learned

The executive is expected get the right things done. Brilliant men are often ineffectual. They fail to realize that brilliant insight is not by itself achievement.

Why do we need to be effective?

For manual work, we only only need to be efficient: the ability to do things right than than the ability to get the right things done. The manual worker is always judged by the quantity and quality of his/her definable and discrete output (e.g. a pair of shoes).

Effectiveness is doing the right things. There’s nothing more ineffective (and less productive) than an engineering department rapidly creating beautiful blueprints but for the wrong product.

Knowledge work is not defined by quantity or its costs - it’s defined by its results. Thus, the size of the group and magnitude of the managerial job are not even symptoms.

Consider the example of a market research manager that has a staff of two hundred people versus the manager who only has himself. The man with two hundred men may be overwhelmed by all the problems two hundred men bring to their work. He may be so busy “managing” that he may have no time for market research and fundamental decisions (like “what does ‘our market’ really mean?”).

The five principles

  1. Effective executives know where their time goes.
  2. Effective executives focus on outward contribution. They focus their efforts to results than than doing work. They start with the question “what results are expected of me?” rather than the work to be done.
  3. Effective executives build on strengths - their own, their superiors, colleagues and subordinates. They do not build on weakness. They do not start out with 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 do the first things first and the second things not at all.
  5. Effective executives make effective decisions. This is a matter of system and taking the right steps in a sequence.

Know Thy Time

Do not start with your tasks. Start with your time. Find out where your time actually goes and then manage your time to cut back unproductive demands on your time.

The supply of time is inelastic. No matter how high the demand, the supply will not go up. Time is also perishable and cannot be stored. Yesterday’s time is gone forever and will never come back.

All work takes place in time and uses up time. Yet, most people take for granted this unique, irreplaceable and necessary resource.

Most of the tasks of the executive require a large block of time. For example, a report may require six or eight hours to write a first draft. It is pointless to spend fifteen minutes twice per day on the task for three weeks. One must lock the door, disconnect the telephone, and sit down to wrestle with the report for five or six hours without interruption.

Therefore, to be effective - an executive needs to dispose of time in fairly large chunks. This is particularly true when working with people. People are time consumers, and most people are time wasters.

To spend only a few minutes with people is not productive. The manager who thinks he can discuss the plans, direction and performance of one of his subordinates in fifteen minutes is just deceiving himself.

The “Span of Control”

The “span of control” asserts that one man can manage only a few people if these people have to come together in their own work.

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 “span of control.”

When more people have to work together, more time is spent on “interacting” rather than work and accomplishment.

Systematic Time Management

Once an executive knows where his time is going, systematic time management is the next step. Find the nonproductive, time wasting activities and get rid of them if he possibly can.

The executive must then realize he is also a waster of other’s time and ask “what do I do that wastes your time without contributing to your effectiveness?”

Time wasters often result from overstaffing. A first grade arithmetic question would ask, “If if takes two ditch diggers to dig a ditch, how long would it take four ditch diggers?”

In first grade, the correct answer is of course “one day.” However, in the kind of work executives are concerned, the correct answer may be four days or forever.

Potential Solutions

Some people work from home once per week. Others schedule all the operating work for two days per week (e.g. Monday and Friday) and set aside the mornings of the remaining days for consistent, continuing work on major issues.

Some spend ninety minutes every morning before going to work in a study without a telephone at home. Even if this means waking up early 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.

Effective executives estimate how much discretionary time they can realistically call their own and then set aside continuous time in the appropriate amount.

What can I contribute?

What can I contribute that will significantly affect the performance and the results of the institution I serve?

The effective executive must also be able to answer:

What do you do that justifies you being on the payroll?

The answer shouldn’t be “I run the accounting department” or “I have 850 people working under me.”

A better answer is: “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.”

Self Development

Individual self-development in large measure depends on the focus on contributions.

When asking “what is the most important contribution I can make to the performance of this organization?”, one is essentially asking:

People in general, and knowledge works 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.

Making Strength Productive

To achieve results, one has to use all the available strengths - the strengths of the associates, the superior and one’s own strengths.

Do not make staffing decisions to minimize weakness but to maximize strengths. Whoever tries to place a man or staff an organization to avoid weakness will end up at best with mediocrity.

The task is not to change human beings. The task is to multiply the performance capacity of the whole team by putting to use whatever strengths there is in the individuals.

Subordinates are paid to perform and not to please their superiors.

When the orchestra conductor has to fill the job of a first cellist, he will not even consider a poor cellist who is a first rate oboe player, even though the oboist might be a greater musician than any of the available cellists. The conductor will not rewrite the score to accommodate a man. Structuring jobs to fit personality is almost certain to lead to favoritism and conformity.

Pick people for what they can do rather than personal likes or dislikes. Seek performance, not conformance. To insure this outcome, keep a distance between yourself and your close colleagues.

Executives everywhere complain that many young men with fire in their bellies turn so soon into burned-out sticks. They only have themselves to blame: they quenched the fire by making the young man’s job too small.

To get strength, one has to put up with weakness

“Does this man have strength in one major area? Is this strength relevant to the task? If he achieves excellence in this one area, will it make a significant difference?”

It is the duty of the executive to remove ruthlessly anyone who consistently fails to perform with high distinction. To let such a man stay on corrupts the others.

It’s unfair to the organization, his/her subordinates who are deprived by their superior’s inadequacy of opportunities for achievement and recognition. Above all, it’s senselessly cruel to the man himself. He knows he is inadequate whether he admits it to himself or not.

General Marshall during WW2 insisted that a general officer be immediately relieved if found less than outstanding. To keep him in command was incompatible with the responsibility the army and the nation owed to the men under an officer’s command.

He waved off the argument “we have no replacement” with “all that matters is that you know this man is not equal to the task. Where his replacement comes from is the next question.”

“The only thing we know is that this spot was the wrong one for the man. This does not mean he is not the ideal man for some other job.”

Managing your boss

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

First Things First

Effective executives do first things first and they do one thing at a time. Effective executives know there is always a time deficit. Doing one thing at a time means doing it fast. The more one can concentrate time, effort and resources, the greater the number and diversity of tasks one can actually perform.

This is the secret of people who “do so many things.” They only do 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. They underestimate the time for any one task. They always expect everything will go right.

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

Slough past was isn’t productive

If we did not already do this, why would we do it now?

Unless there is a compelling reason, they drop the activity or curtail it sharply.

For all programs, activities and tasks, the effective executive asks

Is this still worth doing?

If not, he gets rid of it so he can concentrate on the few tasks that, if done with excellence, will really make a difference in results of his own job and the performance of the organization.

Slough off an old activity before starting on a new one. This is necessary for organizational “weight control” - without it, the organization loses shape, cohesion and manageability.

Du Pont

Du Pont abandons a project or process before it begins to decline. It does not invest scarce resources of people and money into defending yesterday.

There’ll always be a market for an efficient buggy whip plant.

or

This product this company and it’s our duty to maintain for it the market it deserves.

Priorities and Posterities

The job is not to set priorities. That is easy. Everybody can do it. Few executives concentrate on setting “posterities” - deciding what tasks not to tackle and sticking to the decision.

Most executives have learned that what one postpones, one actually abandons. There is nothing less desirable than taking up later a project one has postponed when it first came up. The timing is almost always bound to be wrong, and timing is a most important factor in the success of any effort.

The Elements of Decision Making

Make is clear what the decision has to accomplish.

In science, these are known as “boundary conditions.” A decision, to be effective, needs to satisfy the boundary conditions.

Compromise

There are two types of compromises.

Half a loaf is better than no bread.

and

half a baby is worse than no baby at all.

In the first example, the boundary conditions are still being satisfied. The purpose of bread is to provide food, and half a loaf is still food. However, half a baby does not satisfy the boundary conditions.

Effective Decisions

A decision is a judgement - a choice between alternatives. It is rarely a choice between right and wrong. At best, it’s 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.

Start with an opinion. People experienced in an area should have an opinion. Not to have an opinion after being exposed to an area for a good long time would argue an unobservant mind and sluggish mind. Thus, asking to search for facts first is undesirable. They will do what everyone is far too prone - search for facts to fit the conclusion they have already reached.

Decisions executives have to make are not made well by acclamation. They are only well made if based on a clash of conflicting views and the dialogue between different points of view. 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 out it may be.

Therefore, the effective decision maker organizes disagreement. For example, a lawyer fresh out of law school may be asked to prepare the strongest possible case for the other lawyer’s client. It trains him to not start out thinking “I know why my case is right” but with thinking how the other side must know, see or take as probable to believe it has any case at all. It forces him to think of the case as two alternatives.

The effective decision maker either acts or he doesn’t. He does not take half action.

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 Effective Executive by Peter Drucker" Photo taken with VSCOcam.