I promised to let you into the late Peter Drucker’s secrets of managing effectively. First, how good are you at the five functions of the manager?
1. setting objectives
2. organising the group
3. motivating and communicating
4. measuring performance
5. developing people
For each of the five, ask two questions: am I truly effective (doing the right thing) or am I merely efficient (doing things right)? Score yourself on effectiveness and efficiency on each of the five functions on a scale of 0–10: 35 or below is inadequate. Rectify fast! 35-70 is average to good. Improve! And 75 and above is great, but don’t relax!
To set objectives, do a feedback analysis on a regular basis. Whenever you take a key decision or action, write down what you expect to happen. Review results at regular intervals and compare them with expectations. Use this feedback as a guide and goad to reinforce strengths and eliminate weaknesses.
Then organise yourself. Ask three absolutely basic and marvellous time management questions.
o What am I doing that does not need to be done at all?
o What am I doing that can be done by somebody else?
o What am I doing that only I can do?
Obviously, you scrap the first, delegate the second, and concentrate only on tasks in the last question. You’ll free up huge quantities of time, but watch out, the unnecessary time-wasters keep on creeping back – shoot ‘em on sight.
Motivating hinges on people identifying themselves with the organisation and their own group, and with its products and/or services: while accepting individual and group responsibility for the quality and performance of their work. The key tools are the three Ps: Pay, Placement and Promotion. That means how you reward people, put the round and square pegs in the appropriate holes, and raise people to realise more of their potential.
Don’t measure performance by financial numbers alone. Look for indicators like market share, quality ratings by customers, successful innovations, competitive rankings, customer satisfaction, employment morale, cost of waste, use of capital, productivity. It’s a measure of the complexity of the management task that you need to get all these indicators moving upwards at the same time.
Finally, developing yourself and others requires constantly taking action to improve – and there will ALWAYS be room for improvement. So take the six step action plan:
1. Identify your strengths
2. Improve your strengths
3. Increase your knowledge
4. Eliminate bad habits
5. Practice good manners
6. Avoid weak areas
It’s no use just concentrating on yourself; being a good deed in a naughty world won’t get you far. Everybody should have their own individual action plans to guide and improve their performance, making the best use of time by concentrating on strengths and wasting as little as possible on areas of low performance.
Drucker, as you can see, was a highly pragmatic man. Pragmatic means ‘concerned with what is practicable, expedient or convenient, or with practical consequences rather than with theories and ideas’. Drucker actually combines both - and that’s how you combine efficiency with effectiveness.
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Efficient Vs. Effective
I do not think that effectiveness and efficiency are mutually exclusive things. For a manager, they are both fundamental preconditions. Being effective means that one is able to properly analyse the evolving environment and selecting the right things as the areas of strategic focus for the enterprise. On the other hand, being efficient requires a carefully carved cultural and operational framework which helps the manager to achieve a particular degree of success, given the level of resources applied to a particular obejctive. In fact, it is fallacy to differentiate the two things as mutually exclusive. One can say that effectiveness is probably a thing that is more affected by the external environment. There will be inherent limitations to anyone's ability to keep on continually selecting the best obejctives, given one's perceptions about the evolving strategic environment. Commitment of resources to a previously selected strategic objective also limits one's degree of freedom to keep on being effecitive on an eternal basis. On the other hand, being efficient is dependent upon the ability to adapt the internal operational environment by establishing a conducive operational culture. This is a relatively easier thing conceptually; however, it can be extremely hard to achieve in reality.
All said and done, a manager has to keep on striving to be both efficient and effective. That is his life!
Efective vs efficient
Yes, you are right they are not mutually exclusive, however one can be effective and still be inefficient or vise versa. If we simply define "efffectiveness" as doing the right thing and efficiency as doing it right, it is quite possible that one can do the right thing wrong or the wrong thing right. Hence, it is critical to define correctly what should be done (effectiveness) and only then to make sure to do it right (efficiency).
A typical example of the opposite is very common in industry where by focussing on maximising the use of their assets (efficiency) they generate significant ammount of inventory or unwanted goods (inefficiency)
effective vs. efficient
Dr. Jose,
I appreciate the insightful response you posted for my comment. I agree with your view point that even if one is highly efficient, one can be completely ineffective. In fact, effectiveness is a precondition for the success of any manager; however that depends more upon the uncontrollable variables dictated to the manager by the operational environment and his ability to come up with the right choices that would suit his resources built over time. It may be appreciated that a firm's resources in terms of manpower and technology as well as capital would have been built up over time and they have a great degree of rigidity. For instance, GM cannot immediately shift its focus on an entirely new strategic opportunity since its current resource base does not permit it such a high degree of liberty. Yes, once you become effective, efficiency can be an easier thing to bring into operation. The two things are in fact complimentary. Efficiency in fact depends upon the lower level managerial abilities and culture while effectiveness is almost always a top management variable.
Thank you for the response.