The Effective Executive, Peter Drucker

Why read this book: learn how to be effective as a manager — personal productivity, working on the right tasks, managing people.

Guard your time

Time is always a limiting factor, it cannot be stored and it is irreplaceable. There’s always too much demand for your time. Guard it closely.

Important questions need large chunks of time to get done. It’s your job to find them. Dividing your time into many small chunks is a waste of time and effort.

Step 1: Log how you actually spend time.

Do it for a few weeks. Real-time, not from the memory. Rethink your schedule. Repeat in six months, as you’ll inevitably drift away.

Step 2: Eliminate waste.

Stop doing things that don’t really matter. Delegate things that can be done by someone else. It’s not the number of hours, it’s the focus that matters. Example of handicapped US official during the war.

Step 3: Fix management issues.

“Repeated” crisis usually means lack of a system or foresight. That’s what routines are for — replace heroics with a process. E.g., a well-managed factory is quiet place, nothing exciting happens there.

Beware of overstaffing. Too many people grind performance to a halt.

Meetings are essential for cooperative work but too many meetings is a sign of poor organization. Meetings should be an exception, not a norm / default.

Bad information flow. Wrong information in a wrong place / time.

Step 4: Consolidate discretionary time.

The larger your org the less time you’ll have under your direct control (“discretionary”). Fight this “natural entropy”. Consolidate it into larger blocks.

Example 1: a bank manager with 1,5 hrs “strict” time blocks and 30 minutes to follow-up / deal with random stuff.

Example 2: set special days for meetings and the other mornings for uninterrupted work.

Another method: work few hours in the morning from home. ;-)

Concentrate on a few key tasks

One “secret” to productivity is concentration. First things first, one thing at a time. The more you can concentrate time, effort, and resources, the greater the number and diversity of tasks you can actually accomplish.

Always look for things you can stop doing (no longer make sense). Especially “yesterday’s successes”. Drop something old before starting something new.

Focus on contribution

Executive focuses on contribution and takes responsibility for the performance of his organization. Effort != results. Focus on results raises the standards of everyone with whom he works.

Top executives can have (uniquely) big impact outside the organization.

Effective executive asks people around him: how can I help you do your work better? Communication downwards doesn’t work. Ask. The objectives set by your subordinates will surprise you.

People adjust to the level of demand you make on them.

Managing people

Making strength productive is the unique purpose of the organization. This also makes weaknesses irrelevant.

It’s easier to raise performance of one leader instead of a whole group. Thus it’s important to put into leadership positions those who can do outstanding work.

You’ll need at least an hour to do performance review, discuss plans or build relationships. Few minutes here and there won’t cut it.

Tip: spend time with high-performers in your org to learn from them. Opportunities, issues, ideas, information “from the trenches”. Not your direct reports. Might be most junior people.

Hiring for strength

Hiring to avoid weakness leads to mediocrity. No one is strong in many areas, strong people have strong weaknesses too. Look for excellence in one major area, not “good” overall.

Usual hiring mistake is start with a job and look for best “match” or “least misfit”. Focus on performance objectives instead.

Hiring tips:

  1. Beware “impossible” jobs (rare mix of personality and skills).
  2. Make each job demanding and big. It needs scope and challenge to produce significant results.
  3. Integrity. It’s one area where weakness is a disqualification.
  4. To get strength you have to put up with weaknesses.
  5. You must promote a man if he’s the best qualified. First, he earned. Second, there are no “indispensable men”. In the same logic, you must remove under-performers. It’s unfair for subordinates, corrupting for the org as a whole and cruel to the man itself.
  6. Hiring is always a gamble. At least it becomes rational gamble when you base it on what man can do.

You start something new with people of tested and proven strength — with veterans. The alternative — to “hire in” new people for new tasks — is too risky. Hire new people to expand on already established and smoothly running activity.

Focus on opportunity

Either you make a decision or the pressures will make it for you. In that case the important tasks won’t get done. Also, the pressures always favor yesterday’s problems, not future.

Setting priorities is easy, the hard part is deciding which tasks to abandon / postpone. It takes courage.

Aim high. Focus on opportunity. Choose your direction. Favor future, not the past. Commit to one task. Get it done and review the situation again.

Concentration means the courage to stick to your decision on what really matters and what comes first.

Making decisions

Focus on few but important (strategic), not just “problem solving”. Impact.

Elements of decision making:

  1. Is this a generic problem? Solve generic problems by establishing a principle (a rule). Once you have a rule you can handle all similar situations pragmatically.
  2. What are the boundary conditions (constraints) that have to be met? What if something goes wrong?
  3. Start with what’s right rather than what’s acceptable. You’ll have to compromise anyway. Otherwise you’ll do a wrong compromise.
  4. Convert decision into action. Most time-consuming yet most critical part of decision making. Specifics on how it will be done is part of the decision.
  5. Built-in feedback mechanism to test the assumptions in real life. You can’t rely on subordinate who carries out the order to provide you with feedback, communications fail. You need other means, including checking for yourself.

Decision making rarely starts with facts, often starts with opinions. That’s okay. Don’t argue with opinions, test them. Either there are facts exist to prove it or you can design a way to test it.

Decision needs conflict. Do not make a decision unless there is a disagreement — it creates alternatives.

Every decision is like surgery. Ask yourself, is it really necessary? “Do nothing” might be a better option. Do nothing if it’s not important or will resolve itself eventually. Act if it’s a major opportunity or can pose a major risk.

Act or do not act; but do not “hedge” or compromise. Half-action is always wrong.

When right decision emerges you must have the courage to accept it and act on it. Postpone or re-evaluate is coward ‘s way. Think through one more time but once decided act with speed and decisiveness.

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