TIME The Drucker Difference

This Is What Makes Most Executives Want to Cry

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If you’ve advanced in your professional status and dread that upcoming trip to Cincinnati, you’re not alone.

According to a new report, summarized in a fun infographic at the HBR Blog, senior executives who spend a lot of time on planes and in hotel rooms tend to find travel a lot more burdensome than do support staff.

The authors, from the company Carlson Wagonlit Travel and the business school HEC Paris, surveyed more than 7,000 corporate travelers and examined travel from the perspective of six different ranks—from support staff to the C-suite—with an eye on 33 different stressors, including immigration and customs, flight seating, fear of flying, hotel quality and expense reports.

Many of the results were intriguing. For example, “the most senior executives are much less stressed by flying in economy-class seats”; it is lower-ranking managers who are bothered. The authors suggest this is because GMs and CEOs often set travel policies and “therefore wear their economy-class membership as an emblem of shareholder value.” Another finding: Women are much more stressed than men by travel across nearly all measurements. A third insight: Post-trip expense reports cause a lot of stress for vice presidents, very little for CEOs.

Peter Drucker would have appreciated the high degree of stress being generated overall by business travel. Although he jetted around the world a lot, he was nevertheless a skeptic of frequent travel, noting that executives did just fine before airplanes became an ordinary, everyday part of life starting in the 1950s. Then suddenly, “the advantage of direct access, face to face, to associates, partners and customers in faraway places so greatly outweighed the fatigue and cost of air travel as to encourage gross overindulgence in it,” Drucker wrote in The Changing World of the Executive.

All the while, new forms of communication were actually making physical presence less important. “Executives will therefore have to think more carefully about what to use travel for,” Drucker advised.

In The Effective Executive, he took even sharper aim at business trips, pointing out that travel easily squanders time, a top manager’s most precious resource. “The jet plane is indeed overrated as a management tool,” Drucker wrote. “A great many trips have to be made; but a junior can make most of them. Travel is still a novelty for him. He is still young enough to get a good night’s rest in hotel beds.” For that reason, travel was a leading candidate for pruning, an example of the work of executives “that can easily be done by others, and therefore should be done by others.”

TIME The Drucker Difference

Retool Your Business With a Clean Sheet of Paper

Peter Drucker taught us, again and again, to focus on “tomorrow’s breadwinners” and cease pouring resources into today’s breadwinners, much less yesterday’s.

In an age when business requires faster adaptation than ever, many now take this principle for granted. But it still can be tricky to put into practice, which is why executives continue to talk about the best way to actually get from yesterday to tomorrow.

“In any transformation I’ve seen, the winner is always the one who takes out a clean sheet of paper and says, ‘This is how you would do it if you didn’t have the drag of your traditional business,’” Perry Evans, CEO of Closely, a digital marketing firm, said in an interview published in Sunday’s New York Times.

As we’ve noted, Drucker loved this particular approach, urging that everything any organization does be periodically put on trial for its life.

This exercise will not only help you determine what to stop doing; it will also help you figure out what to double-down on. In fact, “the starting point is to identify the activities that are productive, that should be strengthened, promoted and expanded,” Drucker counseled in Managing in a Time of Great Change.

One more tip for a successful transformation: Involve a variety of junior people within the enterprise, and not just the leaders, in thinking about it. In an interview that appears in Managing in the Next Society, Drucker spoke of one company that he particularly admired.

“Every three months, a group of people from the organization—younger people, junior people, but never the same people—sits down and looks at one segment of the company’s products, or services, or process or policies with a question: If we didn’t do this already, would we go into it the way we are now?” Drucker explained. “Every four or five years, that company has systematically abandoned or at least modified every single one of it products and processes, and especially its services. That’s the secret of its growth and its profitability.”

TIME The Drucker Difference

This Is the Secret to Pixar’s Monster Success

Pixar Exhibition At Caixaforum In Madrid
Gabriel Solera—Getty Images

How on earth does Pixar do it?

The computer-animation production company has turned out 14 box-office blockbusters in a row. Rave reviews. Great screenplays.

Now, Ed Catmull, one of the company’s founders, has written a book, Creativity Inc., which promises to clear up a bit of the mystery. In an excerpt prepared for Fast Company, Catmull explains that one of the company’s “key mechanisms” is the “Braintrust,” which meets every few months or so and operates on the following principle: “Put smart, passionate people in a room together, charge them with identifying and solving problems and encourage them to be candid.”

Catmull says that there are two important characteristics of the Braintrust. The first is that it offers much-needed perspective. “People who take on complicated creative projects become lost at some point in the process,” he writes. “Where once a movie’s writer/director had perspective, he or she loses it. Where once he or she could see a forest, now there are only trees. How do you get a director to address a problem he or she cannot see?”

The second is that the Braintrust concerns itself with the task, not the person. “The film—not the filmmaker—is under the microscope,” he says. “This principle eludes most people, but it is critical: You are not your idea, and if you identify too closely with your ideas, you will take offense when challenged.”

Peter Drucker would have surely been taken with Catmull’s insights, and in fact we’ve covered a number of these points before, including the importance of candor, trust and perspective.

But one area worthy of elaboration is the need to make sure the work at hand doesn’t get too personal.

Drucker recognized that many people identify closely with their jobs—and so it’s not surprising that they can take it hard when their ideas are questioned or criticized. A person’s “relationship to his work underlies all of man’s life and achievements,” he wrote in The Practice of Management.

And yet, like Catmull, Drucker thought it crucial for people not to view challenges to their ideas as a personal affront. “Emotions always run high” over key decisions, Drucker noted. “The smart thing is to treat this as constructive dissent and as a key to mutual understanding.”

At the same time, those doing the questioning need to be careful not to make it personal. They must focus on “What is right?” rather than “Who is right?” “To put personality above the requirements of the work is corruption and corrupts,” Drucker asserted. “To ask ‘Who is right?’ encourages one’s subordinates to play safe.”

TIME The Drucker Difference

Want to Succeed? You Should Seriously Consider Doing Nothing

If you want to motivate yourself to keep doing something, rather than getting lazy and copping out, here’s an idea: Make “do nothing” one of the choices you present yourself with.

The reason, according to a study by University of Pennsylvania marketing professor Rom Y. Schrift and Georgia State University marketing professor Jeffrey R. Parker, is that adding in the do-nothing choice makes us more likely to persevere in what we set out to do.

For instance, if you plan to start working out and join Gym A or Gym B, add in the option of not joining any gym at all.

“Whether it is workplace management, the health care arena or parenting, a subtle addition of a seemingly innocuous option can actually make someone want to do something even more,” an article in Knowledge@Wharton explains.

Puzzling? “It sounds counterintuitive because we assume that the option of doing nothing reduces persistence,” Schrift tells Knowledge@Wharton. “However, if I choose something, I learn about my preferences. Just knowing that fact helps us persist longer when there’s adversity or hardship.”

Peter Drucker would surely have agreed that giving yourself the option of doing nothing can be clarifying. In particular, it can help you figure out what the decision is really about, a topic we’ve addressed before. Gym A or Gym B may really be a decision about how much to work out, for example.

But Drucker would also likely add that sometimes the option to “do nothing” is a good one to consider because sometimes it’s best to, well, do nothing. As Drucker pointed out in Management: Tasks, Responsibilities, Practices: “There is one question the effective decision-maker asks: ‘Is a decision really necessary?’ One alternative is always the alternative of doing nothing.”

And sometimes, in fact, “there are those conditions with respect to which one can, without being unduly optimistic, expect that they will take care of themselves even if nothing is done.” That’s why Drucker advised, “If the answer to the question ‘What will happen if we do nothing?’ is ‘It will take care of itself,’ one does not interfere.”

It’s a rule too often ignored by decision makers (not to mention gym rats).


Here’s the Best Case for Taking Major Risks

As Peter Drucker asserted decades ago, any effective nonprofit must have an eye to innovation.

That’s one reason grantmakers often speak of taking chances and trying new approaches. However, as Gabriel Kasper and Justin Marcoux observe in Stanford Social Innovation Review, in recent years, in dicey economic times, “many funders have lost their appetite for experimentation and risk, even as they trumpet their desire to make big bets.” In the end, some foundations “are willing to support only safe, established programs.”

The trouble with going small or safe is that it doesn’t get you far enough. As the authors note, “In many cases, existing approaches are proving insufficient to truly crack the intractable social and environmental problems that we face.” Instead, they argue, funders must steel themselves to “take risks on less proven approaches, open themselves up to exploring new solutions and recognize that innovation requires flexibility, iteration and failure.”

For that reason, the authors offer up eight ways for foundations and other funders to “inject innovation into grantmaking.” Among them is the practice of dedicating “10 percent of your grantmaking budget to support projects that seem promising but don’t fit neatly into your strategy.” Another one: “Use your special opportunity fund” to “explore a new area that is tangential to your primary strategies but shows potential.”

Drucker would have been all for these ideas. In fact, in Drucker suggested that organizations have two budgets: “an operational budget for the things that are already being done, and an opportunities budget for proposed new and different ventures.” While the opportunities budget would be much smaller than the operations budget, “both should be given the same amount of top management time and attention.”

As for the size of such budgets, Drucker was right in line with Kasper and Marcoux, suggesting that “the 10% or 12% of annual expenditures needed to create and maintain resources for the future—in research and technology, in market standing and service, in people and development—must be put into a constant budget maintained in years good and bad.”

Perhaps even more important than the specific size of an opportunities or “futures” budget is the mindset behind one. Drucker pointed out that budgeting is commonly thought of as a financial process. “But only the notation is financial,” he explained in Management: Tasks, Responsibilities, Practices. “The decisions are entrepreneurial.”

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How Much of Your Success Is Due to Dumb Luck?

Jonathan Kitchen—Getty Images

Would you like the Mona Lisa if others didn’t? Would you still think Beethoven’s Pastoral Symphony was good? Would you still think the songs of the Beatles were superior to those of, say, Justin Bieber?

In a report last week on NPR’s Morning Edition, Alix Spiegel raised the question of whether our collective aesthetic judgments are due more to chance than we think. She reported that a Princeton professor named Matthew Salganik has run an experiment addressing precisely this issue.

The test went as follows: Some 30,000 teenagers recruited online were separated into nine groups and exposed to a collection of 48 songs from emerging recording artists. They could download the ones they liked best for free. The findings? If they could see a history of what their peers in their group had already picked, the teens often joined the crowd, giving certain songs momentum. But the songs that emerged as leaders differed from group to group. A song that came in first in one group came in 40th in another.

“There were differences in the beginnings, and then the process of social influence and cumulative advantage sort of magnified those small, random initial differences,” Salganik told Spiegel.

The takeaway, in Salganik’s view, goes beyond music: “I think that if you believe that there’s a large role for chance in the outcomes that people have and the kinds of success that people have and also the kinds of failures that people have, it changes how you treat other people,” he said.

In other words, we ought to be a bit humbler about our success and recognize the role of luck.

As far as Peter Drucker was concerned, he maintained that some works of art have inherent qualities that elevate them into the realm of the sublime—regardless of audience differences. For instance, in the case of Dante’s Divina Commedia, it is the “multiplicity of levels on which this book can be read, from being a fairy tale to being a grand synthesis of metaphysics, that makes it the overpowering work of art that it is,” Drucker wrote in a 1969 essay on communication.

But not even the greatest art can be counted on to promote itself, and even Dante required sales and distribution. As Drucker wrote in Post-Capitalist Society, “Even the most solitary artists, writers or painters depend on others for their work to become effective—the writer on an editor, a printer, a bookshop; the painter on a gallery.”

And while luck has a big role in our lives, and many things are a matter of chance, long-term success tends not to be. “‘Opportunity is where you find it,’ says an old proverb. It does not say: ‘ . . . where it finds you,’” Drucker noted in Managing for Results. “Luck, chance and catastrophe affect business as they do all human endeavors. But luck never built a business. Prosperity and growth come only to the business that systematically finds and exploits its potential.”

TIME The Drucker Difference

McDonald’s Needs a ‘Miracle’ Like the Pretzel Bun

Wendy's hamburger has become more popular than McDonald's.
Paul Vernon / AP

Alas, McDonald’s has been out-bunned.

The hamburger giant and rival Wendy’s have taken different approaches to their businesses in recent years, and Wendy’s has prospered while McDonald’s, lately, has stumbled. Why?

Evidently, things have gotten too complicated on the McDonald’s menu. “We need to do fewer products with better execution,” said the company’s chief operating officer, Tim Fenton.

Tom Gara of The Wall Street Journal concurs, finding McDonald’s guilty of “firing multiple shots in all directions” and overwhelming customers and franchisees with “chicken wings, fish nuggets, bacon habanero ranch burgers and a line of wraps, among many other things.” By contrast, Wendy’s “doubled down on its core burger lineup and introduced a very successful twist: the pretzel bun.”

So, Gara asked, “Is it better to be a cunning player of many games, or a highly focused one-trick pony?”

Actually, it depends. (Sorry, it just does.) As we’ve pointed out, Peter Drucker stressed the importance of focus, of avoiding product clutter and of keeping innovation simple. Still, while McDonald’s miscalculated, that doesn’t mean that it was being foolhardy.

Adding food items to a restaurant menu isn’t terribly drastic, after all. And, as Drucker noted in Managing for Results, “The odds against any new product’s becoming even a moderate success are roughly five to one, and the odds against it becoming a smash hit are 100 to one.” So, failing the miracle pretzel bun, you’ve got to try a few things.

What’s more, McDonald’s is in many respects what Drucker called a “creative imitator,” an entrepreneur that “does not invent a product or service” but rather “perfects and positions it” through effective marketing and management. With creative imitators, Drucker explained, the requirements are for “alertness, for flexibility, and . . . for hard work and massive efforts”—all of which McDonald’s has put forth.

However, creative imitators also have vulnerabilities. “Creative imitators are easily tempted to splinter their efforts in the attempt to hedge their bets,” Drucker warned. “Another danger is to misread the trend and imitate creatively what then turns out not to be the winning development in the marketplace.”

That apparently includes the bacon habanero ranch burger.

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