The Daily Drucker: January 31 – A Functioning Society

Unless power is legitimate there can be no social order.
 

A functioning society must always be capable of organizing the tangible reality of the social order.  It must master the material world, make it meaningful and comprehensible for the individual, and must establish legitimate social and political power.

No society can function unless it gives the individual members social status and function, and unless the decisive social power is legitimate power.  The former establishes the basic frame of social life: the purpose and meaning of society.  The latter shapes the space within the frame: it makes society concrete and creates its institutions.  If the individual is not given social status and function, there can be no society but only a mass of social atoms flying through space without aim or purpose.  And unless power is legitimate, there can be no social fabric; there is only a social vacuum held together by mere slavery or inertia.

ACTION POINT: What will the emerging government in Iraq have to do to become legitimate?  What must a legitimate government do to create status and function for Iraqis?

                                                                                               

Quoted from The DailyDrucker, January 31, page 33

The Daily Drucker: January 30 – Terrorism and Basic Trends

Management of an institution has to be grounded in basic and predictable trends that persist regardless of today’s headlines.

The terrorist attacks of September 2001 and America’s response to them has profoundly changed world politics.  We clearly face years of disorder, especially in the Middle East.  Management of an institution – whether a business, a university, a hospital – has to be grounded in basic and predicable trends that persist regardless of today’s headlines.  It has to exploit these trends as opportunities.  And these basic trends are the emergence of the Next Society and its new and unprecedented characteristics, especially

·                     The global shrinking of the youth population and the emergence of “new workforce”

·        The steady decline of manufacturing as a producer of wealth and jobs

·        The changes in the form, the structure, and the function of the corporation and of its top management

In times of great and unpredictable surprises, even basing one’s strategy and one’s policies on these unchanging and basic trends does not automatically ensure success.  But not to do so guarantees failure.

ACTION POINT: Write down three basic social trends that your business is based on.  Are these trends still all intact?

                                                                                                Managing in the Next Society

Quoted from The Daily Drucker, January 30, page 32

The Daily Drucker: January 29 – Performance: The Test of Management

Achievement rather than knowledge remains both the proof and aim of management.

The ultimate test of management is performance.  Management, in other words, is a practice, rather than a science or profession, although containing elements of both.  No greater damage could be done to our economy or to our society than to attempt to professionalize management by licensing managers, for instance, or by limiting access to management positions to people with a special academic degree.  On the contrary, the test of good management is whether it enables the successful performer to do her work.  And any serious attempt to make management “scientific” or a “profession” is bound to lead to the attempt to eliminate those “disturbing nuisances,” the unpredictability of business life – its risks, its ups and downs, its “wasteful competition,” the “irrational choices” of the consumer – and in the process, the economy’s freedom and its ability to grow.

ACTION POINT: Which of your management practices have yielded good results?  Which practices should you abandon now?

                                                                                                                              

 Quoted from The DailyDrucker, January 29, page 31

The Daily Drucker: January 28 – Controlled Experiment in Mismanagement

The story of Henry Ford, his rise and decline, and of the revival of his company is what one might call a controlled experiment in mismanagement.

The story of Henry Ford, his rise and decline, and the revival of his company under his grandson, Henry Ford II, has been told many times.  But it is not commonly realized that this dramatic story is far more that a story of personal success and failure.  It is, above all, what one might call a controlled experiment in mismanagement.

The first Ford failed because of his firm conviction that a business did not need managers and management.  All it needed, he believed, was the owner-entrepreneur with his “helpers.”  The only difference between Ford and most of his business contemporaries, in the U.S. as well as abroad, was that, as in everything else he did, Henry Ford stuck uncompromisingly to his convictions.  The way he applied them – for example, by firing or sidelining any one of his “helpers,” no matter how able, who dared to act as a “manager,” make a decision, or take action without orders from Ford – can only be described as a test of a hypothesis that ended up by fully disproving it.  In fact, what makes the Ford story unique – but also important – is that Ford could test the hypothesis, in part because he lived so long and in part because he had a billion dollars to back his convictions.  Ford’s failure was not the result of personality or temperament but, first and foremost, the result of his refusal to accept managers and management as necessary as grounded in task and function rather than in “delegation” from the “boss.”

ACTION POINT: Are you an owner-executive who treats all your employees as your helpers?  Are you an employee who is treated as a helper? List three ways your organization could be more profitable if employees are encouraged to assume responsibility.

                                               

Quoted from The Daily Drucker, January 28, page 30

The Drucker Daily: January 27 – The Discipline of Management

If you can’t replicate something because you don’t understand it, then it really hasn’t been invented, it’s only been done.

When I published The Practice of Management, fifty years ago, that book made it possible for the people to learn how to manage, something that up until then only a few geniuses seemed to be able to do, and nobody could replicate it.

When I came into management, a lot of it came out of the field of engineering.  And a lot of it came out of accounting.  And some of it came out of psychology. And some more of it came out of labor relations.  Each of those field was considered separate, and each of them, by itself, was ineffectual.  You can’t do carpentry, you know, if you have only one saw, or only one hammer, or if you have never heard of a pair of pliers.  It’s when you put all of those tools into one kit that you invent.  That’s what I did in large part in The Practice of Management. I made a discipline of it.

ACTION POINT: Are your management practices ad hoc or systematic?

Quoted from The Daily Drucker, January 27 , Page 29