Getting Stuck

When each link is managed somewhat separately, the system can get stuck in a low-effectiveness state.

There are portions of organizations, and even of economies, that are chain-linked.  When each link is managed somewhat separately, the system can get stuck in a low-effectiveness state.  The problem arises because of quality matching.  That is, if you are in charge of one link of  fate chain, there is no point in investing resources in making your link better if other link mangers are not.

To make matters even more difficult, striving for higher quality in just one of the evinced units may make matters worse!  Higher quality in a unit requires investments in better resources and more expensive inputs, including people.  Since these efforts to improve just one linked unit will not improve the overall performance of the chain-linked system, the system's overall profit actually declines.  Thus, the incentive to improve each unit is dulled.

ACTION POINT: Ensure the strengthening of all links is unified.

Integrity in Leadership

The spirit of an organization is created from the top

The proof of the sincerity and seriousness of a management is uncompromising emphasis on integrity of character. This, above all, has to be symbolized in management’s “people” decisions.  For it is character through which leadership is exercised; it is character that sets the example and is imitated. Character is not something one can fool people about. The people with whom a person works, and especially subordinates, know in a few weeks whether he or she has integrity or not.  They may forgive a person for a great deal: incompetence, ignorance, insecurity, or bad manners. But they will not forgive a lack of integrity in that person.  Nor will they forgive higher management for choosing him.

This is particularly true of the people at the head of an enterprise.  For the spirit of an organization is created from the top.  If an organization is great in spirit, it is because the spirit of the top people is great.  If it decays, it does so because the top rots; as the proverb has it, “Trees die from the top.”  No one should ever be appointed to a senior position unless top management is willing to have his or her character serve as the model for subordinate.

ACTION POINT:  Align yourself with people who have integrity.

Quality vs Quantity

On the other hand, if a three-star chef is ill, no number of short-order cooks is an adequate replacement.

Quality matters when quantity is an inadequate substitute.  If a building contractor finds that her two-ton truck is on another job,she may easily substitute two one-ton trucks to carry landfill.  On the other hand, if a three-star chef is ill, no number of short-order cooks is an adequate replacement.

One hundred mediocre singers are not the quality of one top-notch singer.  Keeping children additional hours of weeks in broken schools-schools that can neither educate nor control behavior--does not help and probably increases resentment and distrust.

ACTION POINT:  Know when quantity is no substitute for quality.

Management Is Indispensable

Whoever makes two blades of grass grow where only one grew before deserves better of mankind than any speculative philosopher or metaphysical system builder.

Management will remain a basic and dominant institution perhaps as long as Western Civilization itself survives.  For management is not only grounded in the nature of the modern industrial system and in needs of modern business enterprise, to which an industrial system must entrust its productive resources, both human and material.  Management also expresses the basic beliefs of modern Western society.  It expresses the belief in the possibility of controlling man’s livelihood through the systematic organization of economic resources.  It expresses the belief that economic change can be made into the most powerful engine for human betterment and social justice-that, as Jonathan Swift first overstated it three hundred years ago, whoever makes two blades of grass grow where only one grew before deserves better of mankind than any speculative philosopher or metaphysical system builder.

Management-which is the organ of society specifically charged with making resources productive, that is, with the responsibility for organized economic advance-therefore reflects the basic spirit of the modern age.  It is, in fact, indispensable, and this explains why, once begotten, it grew so fast and with so little opposition.

ACTION POINT: Come up with a few examples of why management, its competence, its integrity, and its performance, is so decisive to the free world. 

Identifying the Future

“The important thing is to identify the “future that has already happened”

Futurists always measure their batting average by counting how many things they have predicted that have come true.  They never count how many important things come true that they did not predict.  Everything a forecaster predicts may come to pass.  Yet, he may not have seen the most meaningful of the emergent realities or, worse still, may no have paid attention to them.  There is no way to avoid this irrelevancy in forecasting, for the important and distinctive are always the result of changes in values, perception, and goals, that is, in things that one can divine but not forecast.

But the most important work of the executive is to identify the changes that have already happened.  The important challenge in society, economics, politics, is to exploit the changes that have already happened” – and to develop a methodology for perceiving and analyzing these changes.   A good deal of this methodology is incorporated in my 1985 book Innovation and Entrepreneurship, which shows how one systematically looks to the changes in society, in demographics, in meaning, in science and technology, as opportunities to make the future.

ACTION POINT: Identify the major trends in your market that have already appeared.