The strange discovery of Peter Drucker | Process Excellence Network
Good advice not only creates good management, good advice is good management. I don’t know when Drucker discovered this, but he explained it one evening while finishing his teachings in an Executive PhD course at Claremont Graduate School. He said he was clueless when he started his consulting assignments and he announced that he was ready to answer any questions on any topic.
One of my more daring classmates raised his hand and began his question: “You have earned a reputation as the world’s leading management expert thanks to your vast knowledge and experience in the business consultancy. My question is: how did you acquire such a wealth of knowledge and experience on so many aspects of management, in so many different organizations and in so many different countries with different cultures, languages and different traditions? »
There was dead silence in the room from both defiance and anticipation of how or if Drucker would respond to this impertinence. He stopped, and most of us expected him to tell us about his college years in Austria and Germany and his work in the United States and elsewhere. We were wrong.
Drucker only paused for a few seconds. He then said, “That’s a very easy question to answer, as I don’t bring knowledge or experience to any counseling situation.”
We were shocked by these words but it got worse. He continued, “What I bring is my ignorance and inexperience in anything relating to the issue.” He stopped as his mouth opened in surprise and added, “Due to my complete lack of knowledge and experience, the only thing I can do is ask questions of those who hire me. They are the ones with the knowledge and experience that I lack, they are the real experts.
He concluded: “It implies that advice is management.”
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Drucker’s Basic Questions
After hearing Drucker’s statements, we inquired about the questions he asks those who hire him. He immediately asked us his main questions:
- What company are you in and what is the mission or purpose of your organization?
- Who is your customer?
- What does your customer appreciate?
- What results are you looking for?
- What is your plan to achieve these results?
Questions Drucker asked the CEO of GE
These were his first questions, but he said there were others. Most famous are his two questions publicly revealed by Jack Welch shortly after he became CEO of GE. The first was, “What companies would you like GE not to be in?” “. The second was, “What are you going to do about it?”.
Welch had made the decision to sell or liquidate even the profitable GE businesses that were not number one or two in their market and were unlikely to reach that position. He used the funds saved to invest in high-potential businesses. This increased GE’s value by 4,000%. He called it his abandonment theory.
Related Article: Drucker’s Method for Solving a Customer’s Problem
A former Drucker client wrote, “Drucker made us think about our problem and apply our own expertise and experience in a way we had never done before. It was incredibly efficient and valuable and we found valuable solutions to our problems that we had missed in the past. We discovered them ourselves because of his questions.
Drucker as a management consultant
Drucker was different. He was an internationally renowned management expert who, when not in his office at Claremont Graduate University, used his living room as a consulting office and operated without a staff. He even answered the phone himself.
He agreed that he helped large corporate and government clients, but did not claim to have any special knowledge or experience in this area. He consulted without relying on expertise but nevertheless collected up to $10,000 for a few hours of work.
Few clients complained that he was unworthy of his fees. He also taught a concise methodology to his clients which they followed to achieve direct multi-step solutions which was also published in one of his books.
Define the central problem
You cannot solve a problem effectively until you have diagnosed it accurately. If a doctor makes the wrong diagnosis and applies the wrong treatment or medication, the patient’s condition may worsen. In any case, it is unlikely to be cured. It’s the same with management analysis, but some consultants attempt a solution without fully understanding the problem. Instead, you need to uncover the central problem that is creating the symptoms.
Defining the central problem is the most difficult, but most important, task in the analysis process. Once you have correctly identified the central problem, you can usually identify several possible solutions. But if the wrong problem is identified, even a brilliant idea will not help and can make the situation worse.
One of the main mistakes made in defining the central problem is to confuse the symptoms with the problem. Low profits, poor sales, or unusual staff turnover are not core issues, but symptoms of core issues.
Start with a brief description, even in one sentence. Be aware that even after you have identified the problem and formulated it concisely, in many cases you will need to modify the problem statement as the analysis progresses.
Also, be careful not to frame the problem as the solution by consciously or unconsciously assuming that a course of action is correct before completing the analysis. Your goal at this point is to phrase the problematic sentence broad enough to not overlook a potential solution, but not so general that it doesn’t make sense.
Avoid framing your problem in such a way that only a yes or no answer is possible. Be careful when incorporating facts extraneous to your central problem, as they can make the statement unnecessarily complex, more difficult and confusing.
With these caveats, you can start formulating your problem statement. The answer to Drucker’s previous questions helped develop the central problem.
Drucker took all the time necessary to refine the central problem. He knew that working on the wrong problem was not only a waste of time, but it also meant a waste of resources and money, and almost invariably resulted in a less than optimal solution.
Yet he rarely used complicated mathematical analysis, but asserted that managers most often and correctly make management decisions not from study, but from the gut.
Determine relevant factors
Relevant factors may include facts, estimates, speculations, assumptions, time available and financial limitations. All must be explored before being accepted and their relevance is important. Although there will be many factors associated with any situation, you should identify and list only those factors that are relevant to the central problem.
List alternative courses of action
Although it is theoretically possible to have an alternative with all the advantages and no disadvantages, this is highly unlikely. If so, the solution is usually obvious and a formal problem-solving analysis procedure is not necessary. The alternatives have both advantages and disadvantages. These are important in all situations and will be analyzed in detail in the next step.
Discuss, compare and analyze each alternative solution
During the analysis, compare the relative importance of the advantages and disadvantages of each alternative compared to all the other alternatives. Some alternatives have few disadvantages, but no great advantage either. Either way, you have to think about it.
This allows the method to be effective in explaining final conclusions and recommendations to others once a clear solution has been developed.
Here’s a test of the clarity of your solution logic and thinking: Show the entire written document up to this point to someone unfamiliar with the problem. Ask them to read everything you have developed so far, then ask them to draw conclusions. If they are almost the same as yours, you have formulated your discussion and analysis correctly. If their conclusion is different from yours, you should do what is necessary to make your analysis clearer to the reader.
List your recommendations resulting from your previous discussions, analyzes and conclusions. Do not list new recommendations based on information that is not included in your analysis. If you think they are necessary, go back and add them earlier in the analysis. You may even need to go back to your central problem and rephrase it.
Make sure your recommendations solve the central problem. If your recommendations don’t solve the problem as you wrote it, either something is wrong with your recommendations or you need to rephrase your core problem.
QED is Latin for “Quod Erat Demonstrandum” or “thus it is shown”. There is a “Drucker difference” and the action of Drucker’s consulting methods and the consulting is management.