Without doubt one of the clearest thinkers on management and leadership was Peter Drucker. The unfortunate situation is that there are many leaders who know little or nothing of the great man’s work. I see Drucker as the Leonardo de Vinci of management and leadership. He will be honoured for centuries to come. It is thus essential that this work is recycled and renewed by all.
His mantel is now being successfully maintained by the management guru Jim Collins who, likewise, can project profound ideas in an easy to adopt manner.
Having now read and digested many of the books written by and about Peter Drucker I have come up with a collection of major points leaders would be wise to understand and follow.
- Abandonment- If you keep doing what you did in the past you are bound to fail.
- Recruitment and Promotion – spend 40 hours at the top of the cliff rather than 400 at the bottom
- Ensure three Protégés are grown for the CEO position
- Always maintain an outside-in perspective
- Who of your ‘non customers’ should you be doing business with?
- Encourage and nurture innovation
- Develop a collaborative approach even with your competitors.
- Moving leadership to orchestration
- Outstanding performance is inconsistent with a fear of failure.
- Decision making requires an understanding of the decision making process
- Self renewal- safe haven
I consider abandonment as one of the most important gifts bestowed on us by Peter Drucker. It is unusual that such a profound concept should have been left unnourished by so many writers who followed in his footsteps. Amongst the overgrown and chaotic jumble within an organisation Drucker saw a clear pathway to freedom, innovation and productivity through the adoption of regular and systematic abandonment. Drucker knew more than anyone, that human beings never like to admit a mistake or own up to failure. To avoid facing the truth we hope circumstances will somehow conspire to make a ‘silk purse out of a sow’s ear’. He saw abandonment as fundamental as breathing, a natural passing of old to new. Examples of abandonment he talked about included
- Cash cows of the past (which were no longer generating the income to justify their continued existence)
- Rectifying recruitment mistakes (no matter how good your recruitment process is, you will make mistakes and these staff need to be told they need to move on)
- Unsuccessful projects
- Systems that are not delivering
- Processes that we have maintained only because we did it last month, last quarter, last year.
Action: Establish an abandonment day, every month, yes every month and get all teams to come up with at least one process, system, procedure that can be abandoned.
Recruitment and Promotion
Drucker talked about recruitment being a life and death decision. In other words, better to spend forty hours over a recruitment or promotion decision rather than spending four hundred hours sorting out the problem at the bottom of the cliff.
Drucker was very specific about rules over recruitment. You must know the job; you need to be well acquainted with the candidates in order to be familiar with their strengths and values. It is essential the potential new recruit’s values are a good fit with the organisation. You can train as much as you like but you will never be able to change values as they are part of a person’s DNA.
Recently I met an owner of a private hospital. He had placed a person into the CEO position knowing he had a track record of buying deals. Within a short space of time fictitious employees were on the payroll, and it cost one million to prosecute the case. The CEO was able to extend the case so no conclusion was reached. That recruitment cost much more than 400 hours!
One aspect of recruitment Drucker strongly advocated is that it is imperative to perform detailed reference checks to really ascertain the candidate’s values. Obviously this means tracking back to previous companies rather than rely on the referees listed on the curriculum vitae.
Drucker liked things in threes. He recommended short listing three candidates to ensure you have an abundance of choice. He would strongly advise this selection process to avoid making a decision where there was only one satisfactory candidate.
Drucker was adamant that you never worried about weaknesses. He pointed out that many famous leaders had appointed staff with known weaknesses because their strengths fitted the job so well.
Action: Whenever you are recruiting realise that this is the most important thing you ever do and thus allow other fires to burn themselves out and concentrate on a well orchestrated interview process.
Three protégés for the CEO position
Drucker was firm in his belief that a leader’s role was largely to prepare the organisation for life without them. He thought it was a failure if the next CEO had to be sourced from outside. Drucker pointed out the advantages of continuity, culture and acceptance. Naturally, the two in-house candidates who were not successful were expected to move to CEO positions elsewhere as they were primed for this role. The creation of CEOs has been a feature of good to great companies in Jim Collin’s book and can be seen in companies such as Toyota and GEC.
Action: Commence action to ensure you are nurturing three protégés.
Jim Collins “Good to Great”