Developing a work approach that is adequate to the challenges ahead
a world moving toward new and different futureS

Topic Notes Contents of Peter Drucker’s work This is a dynamic outline that may be viewed by expanding or contracting rows that begin with a triangle. Also be sure to see my About Peter Drucker page and Peter F. Drucker Annotated Bibliography which has synopses and links to more detailed outlines in many cases. The End of Economic Man The Future of Industrial Man Concept of the Corporation Introduction To The Transaction Edition Preface To The 1983 Edition Preface To The Original Edition Capitalism In One Country Capitalism in one country The profit motive Big business The large corporation as autonomous Its function in society Can the two be harmonized? Idealism and pragmatism, both leading to totalitarianism The Corporation As Human Effort Organization for Production Experience in the war The problem of leadership Recruiting and training Specialists and "generalists" Policy and initiative A yardstick of efficiency Decentralization General Motors' policies Line and staff An essay in federalism Central and divisional management Service staffs Bonuses The "Sloan meetings" Freedom and order Base pricing Competition in the market How Well Does It Work? The conversion to war production Reconversion to peacetime work Isolation of the top executives Customer relations Dealer relations Community relations General public relations The Small Business Partner New-car sales and the used-car market The dealer's franchise Loans to dealers Decentralization as a Model? Decentralization for other industries The Fisher Body Division Chevrolet The competitive market check The production of leaders The Corporation As A Social Institution The American Beliefs Equal opportunity Uniqueness of the individual "Middleclass" society Are opportunities shrinking? Emphasis on education Dignity and status in industrial society Assembly-line "monotony" The failure of paternalism Can the unions do it? The Foreman: The Industrial Middle Class The foreman His opportunities The "forgotten man" The drive to unionize foremen The Worker The worker's industrial citizenship Training The plant community Lessons of the war Flexibility of mass production The worker's pride and interest Inventiveness "Social gadgeteering" Suggestion plans Plant services The wage issue The strike against General Motors Profits, pricing, and wages The annual wage Collectivism not the answer Worker's participation in management Economic Policy In An Industrial Society The "Curse of Bigness" Society's stake in corporation policy Monopoly The old theories Supply and demand Efforts to regulate The "curse of bigness" Economics and technological necessity General Motors service staffs Policy-making and long-term interests Social stability Production for "Use" or for "Profit"? Risks Expansion Capital requirements The profit motive "Creative instincts" The lust for power The market theory Price Economic wants "Economic planning" Social needs The market as yardstick Individual wants The socialist counterargument Self-interest Is Full Employment Possible? Depressions The business cycle Public works programs The challenge to business leaders The calendar year strait jacket Cyclical taxes Reserves for employment funds Unemployment insurance Union wage policies Capital for new ventures Economic policy for a free-enterprise society The threat of total war Epilogue (1983) The New Society Practice of Management (by Peter Drucker) The Nature of Management The Role of Management The dynamic element in every business A distinct and a leading group The free world's stake in management The Jobs of Management Management the least known of our basic institutions The specific organ of the enterprise The first function: economic performance Supply of goods and services desired by the consumer at the price the consumer is willing to pay Maintain or improvement of wealth producing resources The first job: managing a business The ultimate test of management is business performance It enable the successful business performer to do his work — whether he be otherwise a good manager or a poor one. Managing as creative action Means taking action to make the desired results come to pass It is a creator Management by objectives Masters the economic circumstances, and alters them by conscious, directed action Managing managers The second function to make productive enterprise out of human and material resources A transmutation of resources The enterprise as a genuine whole Managers must manage "It's the abilities, not the disabilities, that count" Managing worker and work The two time dimensions of management The integrated nature of management The Challenge to Management The new industrial revolution Automation: science fiction and reality What is automation Conceptual principles, not techniques or gadgets Automation and the worker Automation, planning and monopoly The demands on the manager Managing a Business The Sears Story What is a business and how it is managed—Unexplored territory Sears, Roebuck as an illustration How Sears became a business Rosenwald’s innovations Inventing the mail-order plant General Wood and Sear's second phase Merchandise planning and manager development T.V. Houser and the challenges ahead What is a Business? Business created and managed by people, not by forces. The fallacy of “profit maximization” Profit the objective condition of economic activity, not its rationale The purpose of a business: to create a customer The two entrepreneurial functions: marketing and innovation Marketing not a specialized activity: the entire business as seen from the point of view of the customer The General Electric solution The enterprise as the organ of economic growth The productive utilization of all wealth-producing resources What is productive labor? Time, product mix, process mix, and organization structured as factors in productivity The function of profit How much profit is required? Business management a rational activity. What is Our Business—and What Should it be? What is our business, neither easy or obvious The telephone company example Failure to answer the question a major source of business failure Success in answering it a major reason for business growth and results Question most important when business is successful Who is the customer? What does the customer buy? Cadillac and Packard What is value to the customer What will our business be? What should our business be? Profitability as an objective The Objectives of a Business The fallacy of the single objective The eight key areas of business enterprise “Tangible” and “intangible” objectives How to set objectives The low state of the art and science of measurement Market standing Innovation Productivity and “contributed value” The physical and financial resources How much profitability A rational capital-investment policy The remaining key areas Today's Decisions for Tomorrow's Results Management must always anticipate the future Getting around the business cycle Finding the range of fluctuations Finding economic bedrock Trend analysis Tomorrow's managers the only real safeguard The Principles of Production Ability to produce always a determining and a limiting factor Production is not the application of tools to materials but Production is the application of logic to work Each system of production has its own logic Each system of production makes it own demands on business and management The systems of production Is mass production “new style” a forth? Unique-product production Mass production, “old style” and “new style” Process production What management should demand of its production people What production systems demand of management “Automation”; revolution or gradual change? Understanding the principle of production required of every manager in the decades ahead. Managing Managers The Ford Story Managers the basic resources of a business, the scarcest, the most expensive and most perishable Henry Ford’s attempt to do without managers The near-collapse of the Ford Motor Company Rebuilding Ford management What it means to manage managers Management not by delegation but by the task The six requirements of managing managers Management by objectives and self-control Vision of the individual managers must be directed toward the goals of the business Their wills and efforts be bent toward reaching those efforts Proper structure of the manager's job Must allow maximum performance The right spirit in the organization An organ of overall leadership and final decision—a chief executive An organ of overall review and appraisal—a board of directors Must make provision for its own survival and growth—provision for tomorrow’s managers A sound structural principles of management organization Management by Objectives and Self-Control The forces of misdirection Workmanship: a necessity and a danger Misdirection by the boss What should the objectives be? Management by “drives” How should managers’ objectives be set and by whom? Self-control through measurements The proper use of reports and procedures A philosophy of management Managers must manage What is a manager’s job Individual tasks and team tasks The span of managerial responsibility The manager’s authority The manager and his superior The spirit of an organization To make common men do uncommon things: the test of performance Focus on strengths Practices, not preachments The danger of safe mediocrity “You can’t get rich but you won’t get fired” “We can’t promote him but he has been here too long to get fired” The need for appraisal Appraisal by performance and for strengths Compensation as reward and incentive Does delayed compensation pay? Overemphasizing promotion A rational promotion system The “life and death” decisions Manager’s self-examination of the spirit of their organization Whom not to appoint to management jobs What about leadership? Chief Executive and Board The bottleneck is at the head of the bottle How many jobs does the chief executive have? How disorganized is the job? Need for work simplification of the chief executive’s job The fallacy of the one-man chief executive The chief executive job a team job The isolation of the top man The problem of his succession The demands of tomorrow’s top-management job The crisis of the one-man chief-executive concept Its abandonment in practice How to organize the chief-executive team Team, not committee No appeal from one member to another Clear assignment of all parts of the chief-executive job How many on the team? The Board of Directors Why a Board is needed What is should do and what it should be Developing Managers Manager development a threefold responsibility To the enterprise To society To the individual What manager development is not It cannot be promotion planning or finding “back-up men” The fallacy of the “promotable man” The principles of manager development Developing the entire management group Development of tomorrow’s demands Job rotation is not enough How to develop managers The individual's needs Manager manpower planning Manager development not a luxury but a necessity. Structure of Management What kind of Structure Organization theory and the “practical” manager Activities analysis Decision analysis Relations analysis Building the Structure The three structural requirements of the enterprise Organization for performance The least possible number of management levels Training and testing tomorrow’s managers The two structural principles Federal decentralization Its advantages Its requirements Its limitations The rules for its application Functional decentralization Its requirements and rules Common citizenship under decentralization The decisions reserved to top management Company-wide promotions Common principles The symptoms of malorganization A lopsided age structure of the management group The Small, The large, the growing business The myth of the idyllic small business How big is big? Number of employees no criterion Hudson and Chrysler The other factors Industry position Capitalization needs Time cycle of decisions, technology Geography A company is as large as the management structure is requires The four stages of business size How big is too big? The unmanageable business The problems of smallness The lack of management scope and vision The family business What can the small business do? The problems of bigness The chief executive and its job The danger of inbreeding The service staffs and their empires How to organize service work The biggest problem: growth Diagnosing the growth stage Changing basic attitudes Growth: the problem of success The Management of Worker and Work The IBM Story The human resource the one least efficiently used The one holding greatest promise for improved economic performance Its increased importance under Automation IBM's innovations Making the job a challenge The worker’s participation in planning “Salaries” for the workers Keeping workers employed is management’s job Employing the Whole Man The three elements in managing worker and work The worker as a resource Human resource and human resource Productivity is an attitude Wanted: a substitute for fear The worker and the group Only people develop The demands of the enterprise on the worker The fallacy of “a fair day’s labor for a fair day’s pay” The worker’s willingness to accept change The worker’ demands on the enterprise The economic dimension Wage as seen by enterprise and by worker The twofold meaning of profit Is Personnel Management Bankrupt? Personnel administration and human relations What has personnel administration achieved? Its three basic misconceptions The insight of Human relations And its limitations “Scientific Management,” our most widely practiced personnel-management concept Its basic concepts Its world-wide impact Its stagnation since the early twenties Its two blind spots “Cee-Ay-Tee” or “Cat”? The “divorce of planning from doing” Scientific Management and the new technology Is personnel Management bankrupt Human Organization For Peak Performance Engineering the job The lesson of the automobile assembly line Its meaning: the assembly line as inefficient engineering Mechanize machine work and integrate human work The rule of “integration” The application of Scientific Management The worker’s need to see the result The worker’s need to control speed rhythm of the work Some challenge in every job Organizing people for work Working as an individual Working as a team Placement “When do ninety days equal thirty years” Motivating To Peak Performance What motivation is needed “Employee satisfaction” will not do The enterprise’s need is for responsibility The responsible worker High standards of performance Can workers be managed by objectives The performance of management Keeping the worker informed The managerial vision The need for participation The C.&O. example The plant-community activities The Economic Dimension Financial rewards not a source of positive motivation The most serious decisions imminent in this area An insured expectation of income and employment The resistance to profit Profit sharing and share ownership “No sale, no job” The Supervisor Is the supervisor “management to the worker”? Why the supervisor has to be a manager The supervisor’s upward responsibility The supervisor’s two jobs Today’s confusion Cutting down the supervisor’s department the wrong answer What the supervisor needs Objectives for his department Promotional opportunities for the supervisor and the worker His management status What the job should be Managers needed rather than supervisors The Professional Employee Are professional employees part of management? Professional employees the most rapidly growing group in the working population Neither management nor labor Professional employee and manager Professional employee and worker The needs of the professional employee His objectives His opportunities His pay Organizing his job and work Giving him professional recognition What parts of this can be done by top management and what part by the manager in charge of the operation What it Means to be a Manager The Manger and His Work “Long white bread” or “universal genius”? How does the manager do his work? The work of the manager Information: the tool of the manger Using his own time The manager’s resource: man The one requirement: integrity What makes a manager? The manager as an educator Vision and moral responsibility define the manager Making Decisions “Tactical” and “strategic” decisions The fallacy of “problem-solving” The two most important tasks: finding the right questions, and making the solution effective Defining the problem What is the “critical factor”? What are the objectives? What are the rules? Analyzing the problem Clarifying the problem Finding the facts Defining the unknown Developing alternative solutions Doing nothing as an alternative Finding the best solution People as a factor in the decision Making the decision effective “Selling” the decision The two elements of effectiveness: understanding and acceptance Participation in decision-making The new tools of decision-making What is “Operations Research”? Its dangers and limitations Its contributions Training the imagination Decision making and the manger of tomorrow The Manager of Tomorrow The new demands The new tasks But no new man Exit the “intuitive” manager The preparation of tomorrow’s manager General education for the young Manger education for the experienced But central will always be integrity Conclusion: The Responsibilities of Management Enterprise and society The threefold public responsibility of management The social developments that affect the enterprise The social impact of business decisions Making a profit the first social responsibility Keep opportunities open Management as a leading group Asserting responsibility always implies authority What is management’s legitimate authority? Management and fiscal policy The ultimate responsibility: to make what is for the public good the enterprises’ own self-interest. America's Next Twenty Years Landmarks of Tomorrow Managing For Results Understanding the business The business realities There are three different dimensions to the economic task One unified strategy Requires an understanding of the true realities The generalizations regarding results and resources The generalizations regarding efforts within the business and their cost. Result area identification Nothing succeeds like concentration on the right business. The basic business analysis Identify & understand those areas in a business for which results can measured Defining the product/service 3 dimensions of business results The burden of pushing through the step-by-step process of analysis Revenues, resources, prospects Relate result areas to the revenue contribution and share of cost burden Allocation of key resources to each result area. Leadership position and prospects of each result area. Tentative diagnosis of result areas Classify the result area Factors involved in diagnosing the product What to do with a result area diagnosed as… Analysis format Anticipate a change in the character of a product Cost analysis What matters about costs Prerequisites for effective cost control p.69 To be able to control cost need an analysis that: Tied to market analysis before action Format Conclusions: Market analysis Introduction The marketing realities These marketing realities lead to one conclusion The market analysis Market analysis is a good deal more than ordinary market research or customer research Other books Analytical questions Analysis worksheets Picture Knowledge analysis Knowledge Need a leadership position and differentiation Uncovering one's specific business knowledge strengths Need to learn to set goals and measure in terms of one's specific knowledge Knowledge realities Evaluations (diagnosis)—how good is our knowledge? The conclusions Superimpose Combining the various analysis Market analysis --> knowledge analysis: Needs for new or changed knowledge. Knowledge analysis --> market analysis: Missed or underrated market opportunities. Reexamine tentative diagnois in light of the market and knowledge analysis What is lacking (3 gaps) The end result of the self-analysis The business's contribution Knowledge area excellences Target result areas Vehicles required to reach these targets The leadership position required in each result area Focus on opportunity Building on strength Ideal business concept Maximizing opportunities Maximizing resources What these approaches have in common The three together (what they do) Procedure Finding business potential Restraints & limitations Imbalances—turning weaknesses into strengths