In Peter Drucker’s The Effective Executive, he outlines eight management practices in the introduction that are the core skills of the effective manager:
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 focused on opportunities rather than problems.
They ran productive meetings.
They thought and said “we” rather than “I”.
But, before really getting to work on these he takes on some very interesting foundational issues. First, “… the executive is, first of all, expected to get the right things done. And this is simply that he is expected to be effective.”((1))
All quotations in this posting are from pp. 1-24. Here is an early example of how the style, and many of the examples, in The Effective Executive are quite dated. The pronoun “she” never appears in the book. When he wrote the book in 1967, women in management were extraordinarily rare and their was only a nascent awareness that women could and should play a full role in our economic and social institutions [↩]
Many business owners and managers are frustrated by the poor results achieved by some portion of their business. They diligently track their business using metrics like sales, profits, customer perceived quality, on time delivery, etc. These are obviously some of the most important results any business needs to produce. Why doesn’t attention to these important metrics produce better results?
Unfortunately none of these metrics are actionable nor controllable as objects of management focus. No amount of teeth gnashing about inadequate sales will generate a single additional sale. No matter how intensely you beat on your operations to improve on time delivery will this lead to improvement.
Why is this so?
Let’s examine on time delivery as an example of the problem. On time delivery is an end result of a process, a series of ordered steps, activities, that are your production operation. This process may not be delivering adequate on time delivery to your customers. But, you cannot understand what is causing this process to be out of control without examining in detail, through what is commonly referred to as root cause analysis, the causes of this failure. Here is a brief list of some of the more common causes:
Machine down time for poor maintenance
Poor part quality
Lack of labor
Poorly trained labor
Inadequate customer requirements specifications
The lesson here is that in order to improve on time delivery you really need to first determine the cause, second set improvement tasks that eliminate the cause, and third measure improvements in that function until you achieve a controlled state of adequate
performance for on time delivery.
The fundamental mind set is to see your business as a system of processes. Your task is to make sure the processes are well defined and operate in a controlled state to produce the desired results. The method for achieving in control processes is to determine the root causes of failure, set tasks to eliminate the cause, and track metrics that measure the reduction of the causative element.
Now you might be in a service business and say to yourself, “My business does not produce widgets. How can this apply to me?”
Services are also produced through a series steps. In many cases these steps are not well-defined and are further complicated by the frequent direct interface with, and frequently the participation of, the customer. It is not as easy to “see” the steps in services production as in widget production. You don’t have the machines and parts moving around with a sequence of physical transformations.
Here is a list of typical causes of poor service quality:
Bad service design
Mis-managed customer expectations
Inadequate information resources in the hands of the frontline service provider
Poor training of the service provider
Unclear decision making scope and authority for the service provider
Learn to see your business from a process perspective. Then, apply process control techniques to drive to better results in sales, profits, customer retention, and whatever else is important.