Drucker

Recently I have been returning to Peter Drucker’s work, specifically The Practice of Management (originally published in 1954, the current edition is HarperBusiness, 1993). On page 50, Drucker says the following:

 ”What is our business is not determined by the producer but by the consumer. It is not defined by the company’s name, statutes, or articles of incorporation but by the want the consumer satisfies when he buys a product or service. The question can therefore be answered only by looking at the business from the outside, from the point of view of the customer and the market what the consumer sees, thinks, believes and wants at any given time must be accepted by management is an objective fact deserving to be taken as seriously as the reports of a salesman, the tests of the engineer or the figures of the accountant — something few managements find it easy to do. In management must make a conscious effort to get honest answers from the consumer himself rather than attempt to read his mind.”                

Customer -Centered Business

So here we are reading something written in 1954 that is still very difficult to do. Almost everyone in business speaks the words, the rhetoric,  of the customer centric business. But it still seems incredibly difficult to overcome the centripetal forces of day-to-day business and really engage customers directly and frankly.    

 Web-Marketing

A recent social web marketing seminar (Social Media Club Boston) reminded me again of this very same problem. One of the presenter’s, Greg Jarboe, SEO-PR, told a wonderful story of  how Southwest Airlines learned that though they might forbid the use of the word “cheap” internally, customers on the web are searching for “cheap airfares” not “inexpensive” or “frugal” or “cost-effective”. Even on the web, or perhaps even more so, the customer defines the terms and values of the game. All the more reason to put effort into finding out what they customer really wants.  

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Recent work with a client brought home to me again the interplay of TPS (Toyota Production system) and intuition.

We were working on developing a job scheduling system in a classic job shop environment. We had worked out a rough value stream map from sales inquiry to shipping. It was clear that there was very little data anywhere. This was a small business environment where everything existed in the heads of the key players. The owner repeatedly asked when we were going to get to the job scheduling system and, “Mark, what is it going to look like and how will it work?”

I kept fending the team off by telling them that we had to push our mapping as far as we could and then, “The answers will appear from the map. It will be clear to all of you how to solve the problems.”

So, we pushed ahead until we reached the point where we needed to develop a simpler sense of the flow of the work. When I asked the team to identify the key groups of activities among all of the ones on the wall, they readily came up with five and, with a bit more discussion, we ended up with seven work centers. Based on the group’s intuition we then designed some job packages and a rough scheduling board to help us put into practice a visual job scheduling system.

This system is now up and running. Improvements are coming regularly. For the first time in the history of this 22 yr. old business, everyone can see what jobs are on the floor, where they are, and each person can pickup a job packet and know what it is that needs to be done in their work center without asking for advice, very often.

The key for me is my faith, demonstrated repeatedly in action, that value stream mapping and job shop lean flow processes can encompass just about any job shop environment. If you follow these practices you will reliably discover a solution that will produce significant steps towards a high-performance business. And, the best part is that with your guidance (and keeping your mouth shut) the team will discover their own solutions that they can continue to improve long after you depart.

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Michael Volpe, VP Marketing at Hubspot, the web marketing software company, pointed me to this book in one of his presentations. I have been sufficiently impressed by the quality of HubSpot’s work that I ran over to my local library and signed it out.

The New Rules of Marketing & PR is a breakthrough book for me about the new world of web-marketing. Here is Scott’s list of the new rules of marketing and PR (I added the numbers to the list for reference later):

1. Marketing is more than just advertising.
2. PR is for more than just a mainstream media audience.
3. You are what you publish.
4. People want authenticity, not spin.
5. People want participation, not propaganda.
6. Instead of causing one-way interruption, marketing is about delivering content at just the precise moment your audience needs it.
7. Marketers must shift their thinking from mainstream marketing to the masses to a strategy of reaching vast numbers of under-served audiences via the Web.
8. PR is not about your boss seeing your company on TV. It’s about your buyerts seeing your company on the Web.
9. Marketing is not about your agency winning awards. Its about your organization winning business.
10. The Internet has made public relations public again, after years of almost exclsuive focus on media.
11. Companies must drive people into the purchasing process with great online content.
12. Blogs, podcasts, e-books, news releases, and other forms of online content let organizations communicate directly with buyers in a form they appreciate
13. On the Web, the lines between marketing and PR have blurred.

Numbers 3, 4, 5, 6, 11, & 12 are the core of the message. And I might add a couple of more notes here. First, all of this is hard work. You don’t hire some outside ad firm to handle this. People intimate with your company’s core values need to be involved. But, then, this means that with a bit of good focus and time management, you also do not need to spend a lot of money to utilize these tools. Second, the role of truth seems central to how you communicate, listen to, converse with, and engage your audience, your clients and customers.

Scott’s book is very well written and clearly organized. This is a must read for those of us still trying to figure out how to leverage the new web-marketing world. It provides a great introduction to seeing an overall strategy for web-marketing.

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Yesterday’s New York Times contained an article by David Pogue, “Mom and Pop Get a Partner: Microsoft”, that announces a whole new suite of services for small businesses from Microsoft. And they are all virtually free. You can set up a website in minutes, purchase your own domain name for free for the first year, get email, use collaborative tools including calendaring, project management, shared documents and more. All of this come with some pretty powerful user access controls so that you can set up teams to collaborate internally or include your customers and everyone sees and changes only what they are supposed.

I would say that anyone in a startup or small business who does not already have a website and these other tools should immediately click on over to Microsoft’s OfficeLive site and check this out. This will require some real work to take advantage of all of the tools available here, but it is not often that such a comprehensive suite is available essentially for free.

If you add a few web-based applications for writing, number crunching, and presentations, clearly we are approaching the new world of cloud computing more rapidly than I had thought. I regularly use  Buzzword for my writing. Others may like the suites of tools at Google or Zoho, for example.

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Managers spend a lot of time worrying about the weaknesses of their employees. “If only I could get her to perform better we would have a really great team.” And countless more along that line. Companies have performance evaluation systems that focus attention on how employees should overcome their weaknesses by additional training, supervision and mentoring, and, above all, more work on self-improvement by the employee. Perhaps this focus on weakness flows from an educational system that has always been more attuned to the “Cs” and “Ds” and what must be done to raise those scores, rather than building on the strengths. Our focus on overcoming weakness is reflected in a saying like, “You can become anything you want to be, if you just try hard enough.”

In the management world, Peter Drucker, the great god-father of modern management, spoke clearly about this matter way back in 1966 in his still prescient and useful little book, The Effective Executive (still in print). “The effective executive fills positions and promotes on the basis of what a man can do. He does not make staffing decisions to minimize weaknesses but to maximize strength…. Performance can only be built on strengths. What matters most is the ability to do the assignment. Strong People always have strong weaknesses too. ”

More recently, others have also come to see that when it comes to both people and organizations the only way to build for results is to build on strengths. One example of this is the work of the Gallup Organization and Marcus Buckingham and Donald D. Clifton in Now, Discover your Strengths ( (Free Press, New York 2001) and Tom Rath, Strengths Finder 2.0 (Gallup Press, New York 2007).
Focusing on strengths engages the best attributes, skills, and experiences. Focusing on strengths engages people where they have the most passion, energy and success. Focusing on strengths focuses on the activities that people have already demonstrated results. Focusing on strengths creates a positive relationship because you a talking about activities that the employee is good at and has the best chance of producing good results. Managers should focus their attention on how to be sure that every person is working on their strengths as much as possible.

There is another reason for this focus on strengths, it removes a crutch that managers use to avoid taking complete responsibility for their performance and the performance of the organization - the myth of lousy personnel - “If I only had better people, I could get my organization to really perform.” More on this at another moment.

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