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Providing feedback to our employees on their performance is a great way to  facilitate growth and set goals for higher production.

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I think it's very important for companies of all sizes to have strict policies when it comes to the handling of cash and inventory.

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Leadership is the most challenging and rewarding task you can set your mind to.

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It's important to stay motivated.  When things are going well I enjoy it but when times are hard I remember that it's only temporary and better times are ahead.

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Communication is the foundation that success is built on.  Without good communication we are lost.

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Communication plays a fundamental role in our daily lives.

And yet the art of communication at work is somewhat of a mystery to certain people.

But if you fail to communicate effectively, you could end up missing your chance of securing your dream job, closing a life-changing deal or advancing in your career.

For some, good communication comes naturally, but for others, it can be hard to articulate their thoughts and feelings in conversation, often leading to conflict and fundamental errors.

So, whether you're an effective communicator or not, it's essential to understand the importance of good communication and how it can help you move forward in the working world.

What Is Effective Workplace Communication?

Effective communication in the workplace is an integral element of a business's success; it enhances relationships within the company and with clients, and it increases employee engagement and the overall effectiveness of a team.

On the other hand, when teams fail to communicate effectively, the results are detrimental to the business. In fact, research by US firm Gartner shows a whopping 70% of business mistakes are due to poor communication. This statistic proves just how critical communication is to job training and why more emphasis should be put on clear instructions and conversations to prevent mistakes from happening within the workplace.

Why Is Good Communication Important in the Workplace?

To demonstrate just how important good communication is at work, we've listed some of the benefits it can have on your professional life.

1. It Improves Team Building

Honest and effective communication can create a strong team. When staff consult with each other, consider other opinions and discuss their progress, they will be more enthused to collaborate. As a result, the strong unit that they create makes the workplace more enjoyable, and they will be eager to perform well so they don't let their teammates down.

Indeed, communication helps solve employee morale issues by keeping entire teams in the loop, making all team members feel useful within the workplace. This lack of secrecy not only boosts team spirit but it also has a positive effect on staff attitudes.

2. It Boosts Growth

Great communication contributes to the growth of the business, which goes hand in hand with your career. It eliminates uncertainties and speeds up the process of policies to ensure there is a smooth delivery of projects.

Take eCommerce website Zappos, for example; their ethos relies on great communication within the organisation and with their clients - something that earned them a spot on Fortune magazine's 2015 list of the 100 best companies to work for.

3. It Increases Innovation

If employees are scared of communicating their thoughts and ideas out of fear of being rejected, then they are likely to become stagnant in their career and only contribute the bare minimum. However, if there is an open line of communication between supervisors and staff members, they are encouraged to be more creative and innovative within the workplace, and they are likely to put forth new and creative ideas.

In today's fast-moving workplace, most ideas are likely to be pushed under the carpet due to a lack of communication. As Cisco managing director Alex Goryachev writes on Forbes: 'People listen mostly to respond rather than to understand. However, digitisation demands active listening to the ecosystem in order to survive and develop collaborative strategies with startups, partners and customers around the world'.

4. It Improves Productivity

Being able to communicate effectively at work can help increase overall productivity. Managers can understand their employees' talents and skills and will then give clear directions to the people that are best suited for the job, thus increasing the overall turnaround time of any given project.

For example, one colleague may be faster and better at using Excel than others; therefore, through communication, a manager can identify this and task them with managing the spreadsheets. If there was a lack of conversation, meanwhile, the project would suffer, and the entire process would slow down, negatively affecting the goal of the company, as a result.

5. It Increases Efficiency

Poor communication compromises efficiency, as well as the overall quality of work. When instructions aren't provided clearly, mistakes are bound to happen. On the other hand, clear instructions eliminate the need to clarify and correct any issues.

Think back to a time where you didn't communicate well with a colleague. It probably resulted in wasted time, effort and resources. So, if you happen to have a manager that doesn't communicate effectively, make sure you ask the right questions to get the information that you need to successfully complete a project. Over time, they will understand what they should be supplying you with so you can start working on your tasks.

6. It Increases Loyalty

When you have a good line of communication with management, you're naturally going to be more loyal to the organisation. You will feel comfortable discussing any professional or personal issues, and you'll be more committed to the company.

This free line of communication also builds trust between a manager and an employee, which results in a loyal relationship. A two-way line of respect ensures there's no micromanagement involved and that an employee is trusted to get on with the job that they were hired to do.

7. It Reduces Mitigation Conflict

Two people in the workplace may feel that they are communicating well, but because they both have different methods of communication, they are misunderstanding each other. Therefore, working with different personalities requires excellent communication skills to limit any conflict in the workplace.

If you are experiencing conflict at work, it's important to look beyond the issue at hand and identify the other person's thought process. You need to consider the communication pattern of the receiver to get a better understanding of what they are trying to say.

8. It Increases Employee Engagement

Good communication goes far beyond talking; it's more about connecting and engaging with others. When teams are engaged, they are more aligned with the company's goals and are generally more motivated to work towards the set targets.

It's also easier for managers to identify what makes a positive and satisfying working environment, allowing them to work towards achieving a balanced working life for their employees.

9. It Resolves Problems

There's bound to be characters that clash and opinions that differ within any working environment. And what's the best way to solve those problems? Clear communication!

Effective communication isn't about who's right and wrong; it's about having open, honest and positive discussions to ensure everyone's needs are met! You're not always going to see eye to eye with your work nemesis, but if you can find a way to work well with them, you'll make the environment much more enjoyable for everyone around you!

10. It Enhances Skills

Managers can identify hidden talents when they communicate clearly with their employees. By doing so, they can tap into these skills and help enhance them, which will contribute to the overall success of the business.

For example, John may be hired as a customer service representative, but through conversation, his manager identifies that he has previous experience in marketing. John is then transferred to Marketing and is much better suited at the position. If the lack of communication were there, however, John would have become stagnant later down the line, and the business would have lost great talent.

In every aspect of your job, you'll be required to communicate in one way or other. It's important to understand just how valuable effective communication is and what impact it can have on your relationships and your progression within the working world.

Why do you think good communication is important in the workplace? Let us know your thoughts in the comments section below!

This article is an updated version of an earlier article originally published on 5 January 2015.

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The Importance of Effective Communication in the Workplace

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Communication plays a fundamental role in our daily lives. And yet the art of communication at work is somewhat of a mystery to certain people. But if you fail to communicate effectively, you could end up missing your chance of securing your dream job, closing a life-changing deal or advancing in your career.

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Great examples of how HR policies can help shape a culture and drive innovation.

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A solid company culture is key for any business, as it determines how engaged your employees are - and for how long you are able to retain them. As a human resources professional, your responsibility is to help shape your company culture so that it is sustainable over the long term. Understanding what your role is and how you can better enhance your company culture can help create an environment that employees look forward to going to each day.

Fifteen members of Forbes Human Resources Council shared what roles and responsibilities HR departments have when it comes to building a sustainable company culture and how HR leaders can carry out these duties. Here's what they had to say:
1. Be A Proactive Culture Consultant
The HR department's role is to be an active organizational culture consultant to the executive team. HR leaders need to assess and understand the current culture, develop a strategic culture plan that aligns with the organization's values and goals and then collaborate with other executive leaders to enhance and implement the plan. - Ben Weber, Vendor Resource Management
2. Define And Communicate
HR can assist leaders in developing a clear definition of sustainable company culture. What does it mean? How is it measured? How are leaders role models? How will employees have an impact? Once a clear definition is established, involve everyone at all levels in the conversation! Fostering an environment of transparency engages both employees and leaders in ownership of achieving these goals. - Sandi Wilson, FinTek Consulting
3. Include Employees In The Process
HR leaders must come up with company culture initiatives that were derived from feedback from the employees, not just using something that they heard at a conference or read in a book. Each company culture is distinctively different, as are its employees, so you must include employees when deciding how to build a company culture where they can contribute to its success and continue to thrive. - Charlene Collier, Capitol Consulting Group
4. Incorporate Sustainability Into The Brand
When building a sustainable company culture, the most important role for HR departments is to get buy-in from prospective employees before they even join the company. In order to do this, the company's message of sustainability should be integrated into their employer brand and used to attract candidates to whom this is important. Additionally, HR can offer incentives to employees who suggest ways of advancing sustainability efforts. - John Feldmann, Insperity
5. Enable Strategic Alignment
HR can strategically play several roles in building and sustaining a company's culture. First, HR can make the biggest impact by consulting and collaborating with leadership to align the organization's performance management process with its vision, mission, values and core principles. Next, encouraging leadership to align recognition and reward programs to reward positive behaviors that tie into these same areas is important. Lastly, HR should be a good role model and should coach other leaders. - Kellie Graham SHRM-SCP, SPHR, Complete Children's Health
6. Follow Your Company Strategy
Practice what you preach! I feel like that should say it all, however, I will expand... Whatever your company strategy is, follow it. One person sees you going against that and the trust walls start to crumble. Companies can use big words and come up with the most elaborate, wonderful, advanced plan to date, but if leadership does not do the simple things (follow through), then it is all for naught. Follow-through is everything. - Adam Mellor, ONE Gas, Inc.
7. Focus On How The Culture Feels
Company culture is defined by how it feels when you walk through the door and interact with employees. Building and maintaining a culture that feels positive takes the whole village. The HR team is responsible for reminding leaders how business decisions are perceived. The greatest partners provide candid feedback while caring deeply about the human in front of you. - Stacie Mallen, CampusLogic
8. Identify Areas Of Focus
It is critical for HR to take the lead role in identifying the best practice areas of focus to influence the desired culture. Once defined, HR needs to ensure the value proposition for the change is clear (what's in it for the company and for the employees) and there has to be 100% buy-in from the top as it can't be a HR-driven project. - Stephen Childs, Panasonic Automotive
9. Play 'The Catcher In The Rye'
The assumption is that the company's culture makes sense and is something everyone in the organization can reflect in their behavior with their engagement with each other, their management, their subordinates, their customers and other stakeholders. I picture HR as the "Catcher in the Rye." HR folks understand the importance of being the culture and they provide guidance to prevent managers and employees from adversely impacting the culture. - Tracy Bittner, SPHR, Ionic Security Inc.
10. Walk The Talk
Culture is core to the success of any company. And culture is tied to behaviors of people, hiring processes, perks, etc., which in the end, define who we are or who we want to be. And every part of the core culture needs to be lived by or demonstrated by every leader. If the culture of a company is to create inclusion and positivity, then our hiring process needs to demonstrate that we pay close attention to those characteristics. - Abhijeet Narvekar, The FerVID Group
11. Find And Retain The Right People
People make the culture in a company. No matter the rhetoric of the leaders or the operational processes in place, if the right people aren't there to manifest them into results and reality, they are nothing more than just ideas. The sacred duty of HR is to help managers bring in the most compatible candidates, maintain open communication and actionable feedback, and put the proper documentation and protections in place for when the wrong ones need to be ushered out. - Angela Nguyen, Ad Exchange Group
12. Integrate Company Values Into Training
It is impossible to build a sustainable company culture without HR's help. HR consults with leadership to align work processes with the values that define the organization's culture. They integrate these values into management and employee training, which reinforce and maintain the desired culture. HR is the front line of acquiring talent who embodies the organization's values and culture. - Cameron Bishop, SkillPath
13. Start With Commitment
It takes commitment from every department for a strong culture to thrive, and it's the primary role of HR to foster that commitment. Start with earning buy-in from your executives; they set the tone company-wide. From there, make sure everyone outside the C-suite understands your company's mission, and, more importantly, believes in it. A shared mission will create a positive culture that lasts. - Vivian Maza, Ultimate Software
14. Serve As Architects Of Culture
HR should act as the architects of culture. Through careful analysis of the corporate landscape, it is their responsibility to devise a plan to build a strong foundation and a sustainable structure that will support and enable the work the organization endeavors to do. It is then their responsibility to work alongside management and staff to ensure the cultural edifice remains strong. - Gregory Pontrelli, Lausanne Business Solutions
15. Advocate For The Company Values
A lot of companies say "our people matter most" or that "culture is king." But without HR's consistent and transparent behavior to prove it, the words are empty. HR is the company's greatest advocate of values because they are so uniquely positioned within the company to have the greatest impact. - Ben Peterson, BambooHR

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Council Post: 15 Effective Ways HR Can Help Create A Sustainable Company Culture

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A solid company culture is key for any business, as it determines how engaged your employees are - and for how long you are able to retain them. As a human resources professional, your responsibility is to help shape your company culture so that it is sustainable over the long term.

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This article from HBR supports the importance of an Organizational Structure and how they may need to change with companies growth. I enjoyed reading someone else's opinion on how they are important in the work place.

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One of the wonderful things about being a coach is that I meet hundreds of executives who freely share their business and leadership challenges with me. As well as helping me understand how hard it is to run an organization, they show me how they are managing to adapt - or not - to changing organizational structures.

A constant theme during meetings over the last three years has been how globalisation and the economic crisis have forced organizations to rethink their strategies and change they way they operate. From what I can gather, much of this has been "on the hoof," with companies switching their focus from markets to products or competitors, rather than looking at the big picture. This can result in lots of piecemeal change initiatives rather than looking at the overall organizational design.

I rarely come across leaders who advocate wholesale organizational redesign or use it as a way to support their people and business. When organizational strategy changes, structures, roles, and functions should be realigned with the new objectives. This doesn't always happen, with the result that responsibilities can be overlooked, staffing can be inappropriate, and people - and even functions - can work against each other.

Often, I see little more than a traditional hierarchy flattening out, perhaps broadening into a matrix structure in parts of the organization. More often than not, though, the hierarchy remains embedded in the "new" structure, which can cut across its effectiveness and leave people confused. Worse, organizations rarely show people how to operate in a new structure, which can also undermine effectiveness.

Many of my clients tell me that they find it increasingly difficult to operate within outdated or dysfunctional structures. My prevailing impression is that organizations either overlook the importance of organizational design or simply don't know what to do.

This isn't surprising since the subject is complex and often poorly explained by academics and consultants, finding a practical approach to organizational design can be difficult, although some business schools are attempting to simplify things (pdf).

It is also a pity since structure dictates the relationship of roles in an organization, and therefore, how people function. An outdated structure can result in unnecessary ambiguity and confusion and often a lack of accountability. Structures can be complicated: one British bank where I coach has a clear hierarchy at the top but a complex matrix structure further down which, according to my clients, allows some managers to dodge their responsibilities while others can move troublesome staff around or "exit" them easily.

Poor organizational design and structure results in a bewildering morass of contradictions: confusion within roles, a lack of co-ordination among functions, failure to share ideas, and slow decision-making bring managers unnecessary complexity, stress, and conflict. Often those at the top of an organization are oblivious to these problems or, worse, pass them off as or challenges to overcome or opportunities to develop.

Here are some of the stories I have come across recently - if you have experienced anything similar or have different insights, it would be useful to hear them in the coming week. Any suggestions for pushing back or reshaping unnecessarily complex or outdated organizational structures are also welcome!

The "unworkable" job: a Swiss engineer told me that his boss had bolted on so many parts to his original role that it was becoming impossible to do his work as one part of his role contradicted the other. Moreover, he was stretched beyond his limits by the scope of the role and the fact that he had to operate across several time zones.

Politics: a Hong Kong retail executive said his role was "schizophrenic" because he was required to influence a group of internal stakeholders who had been instructed by their boss not to co-operate with him. The anomaly was the result of historical turf wars between his boss and his boss' peer: the latter had used his influence to restructure the department and bring it under his control.

Over-regulation: a British banker explained how he was required to get approval from so many people for a major project that he wasted six months trying to get it off the ground, severely limiting his ability to compete in the market.

Applying for your own job: a French executive of an international food company explained how a new chief executive wanted to make his mark by restructuring the group. The exec made people apply for their own jobs, and determine who was redundant.

Cultural clashes: I once worked in a consultancy firm where a sizeable group of people still defined themselves by the organizational culture of a company that was taken over 20 years before. This group made a point of working against the new culture and subverted the company in small and far-reaching ways.

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The Importance of Organizational Design and Structure

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One of the wonderful things about being a coach is that I meet hundreds of executives who freely share their business and leadership challenges with me. As well as helping me understand how hard it is to run an organization, they show me how they are managing to adapt - or not - to changing [...]

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The organizational structure is an important step in assisting Sun City Boards. Now they need to stick to the plans set in place in order to be successful.

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Policies, procedures and regulations are all very important not just to have but to follow for any business to be successful.

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In this module I learned about the SWOT analysis. I was interested to learn more about it and get a more in depth view on the way it works.

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SWOT analysis identifies a company's internal strengths and weaknesses, and the external opportunities and threats it faces. Internal and external stakeholders can use SWOT analysis to evaluate a company relative to its industry peers. Management can employ SWOT analysis to develop strategic business plans, evaluate potential acquisition targets and assess the competitive landscape.

A company's strengths are the things that it does well, such as research and development, while its weaknesses represent operational gaps, such as inadequate cash flow or inexperienced management. The opportunities represent economic and business conditions that the company can exploit, such as financial difficulties facing a competitor or strong economic conditions. The threats may include changes in the regulatory environment and new competitors that could increase costs and harm profits.

Significance

SWOT analysis provides a comprehensive view of a company. Identifying the internal weaknesses and external opportunities lead to an understanding of where the company is today and where it needs to be to achieve its strategic objectives. For example, an underserved regional market might be an opportunity for a small company. However, its weakness might be that it does not have the marketing expertise or sufficient sales representatives to develop sales leads in the new market. The company could bridge this gap by exploring partnerships with other companies currently serving the market or by establishing a small sales office. Similarly, a company could use its internal strengths, such as sufficient cash flow, to respond to external threats, such as the launch of new ads by a competitor.

Implementation

SWOT analysis usually starts with collection of data, including sales trends, profit trends and employee and customer satisfaction levels. New Mexico State University professor David M. Boje cites the "minimax" approach to SWOT analysis. This approach involves first identifying a company's key strengths, weaknesses, threat and opportunities. The next step is to list the strategic combinations that minimize weaknesses while maximizing strengths and minimize threats while maximizing opportunities. For a small business, interviewing the chief executive officer and a couple of other key executives might be enough for a SWOT analysis. However, multiple viewpoints lead to a more comprehensive and participative analysis, which has the additional advantage of laying the groundwork for future strategic initiatives and process improvement plans.

Considerations

The MindTools website makes a few recommendations with respect to conducting a SWOT analysis. There should be an emphasis on quantifiable facts, such as the number of additional personnel required and the pricing strategy of competitors. A company should focus on the weaknesses and threats where it can make the most difference. For example, management could select one business division that is performing below the company average and do a SWOT analysis on this division to improve its performance.

Photo Credits

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About the Author

Based in Ottawa, Canada, Chirantan Basu has been writing since 1995. His work has appeared in various publications and he has performed financial editing at a Wall Street firm. Basu holds a Bachelor of Engineering from Memorial University of Newfoundland, a Master of Business Administration from the University of Ottawa and holds the Canadian Investment Manager designation from the Canadian Securities Institute.

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What Is SWOT & How Does It Work?. SWOT analysis identifies a company's internal strengths and weaknesses, and the external opportunities and threats it faces. Internal and external stakeholders can use SWOT analysis to evaluate a company relative to its industry peers. Management can employ SWOT analysis to ...

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Cultural differences are important to remember especially in the business world.

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In this module Peter Drucker was mentioned as the "manager expert"; his quote regarding management was very inspiring, leaving me to want to learn more about him.

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The Idea in Brief

* Peter Drucker's extensive, thoughtful writing about the management of organizations has garnered both zealous disciples and dismissive critics.

* The point with Drucker is to read not primarily for the ideas, though they are both useful and interesting, but rather to learn from the way he thinks.

* Drucker's real contribution lies in his integrative, holistic thinking; fair-mindedness; and dispassionate objectivity. One can learn more-and more deeply-from observing the discipline of his mind than from studying the content of his thought.

Originally published January-February 1980
Mention the name of Peter Drucker and many an ear in the business forest stands up straight. Over the years little of concern to business has fallen outside the extraordinary range of his interests, and few of those interests have escaped thoughtful, often classic exposition in his six-foot shelf of articles and books.

Such productivity is itself a professional achievement of the first order. Add to it, however, Drucker's countless appearances in executive seminars, lecture halls, conference rooms, and classrooms; his extensive labors as a consultant; and his facility for expressing complex ideas simply and elegantly. No wonder the mention of Peter Drucker commonly guarantees attention. People listen because they respect the authority of experience-distilled, analyzed, articulate-and are eager to profit by it.

There are those, of course, who do not listen so attentively to Drucker. Some, especially within the academy, think him more journalist than scholar and more glib generalizer than journalist. They slight his research as no research at all and his ideas on management as unstructured and (worst sin of all) unsystematic. To their minds Drucker is an armchair philosopher who lacks practical credentials as a doer.

At one extreme they believe him neither interested nor competent in the myriad details of day-to-day business operations and therefore question the authority his judgments regularly carry.

At the other extreme Drucker's most attentive followers, like those of many a popular thinker, grant him too much. Out-of-context snippets from his writings or conversations often appear in support of contentions that he himself does not endorse. Similarly, overly ardent disciples reduce the complexity of his thought to a handful of canonical ideas that, in their doctrinaire simplicity, do violence to the original.

In point of fact, Drucker's works lend themselves to these excesses of reaction. By relying in places on such suggestive-but incompletely wrought-notions as the "contribution coefficient," Drucker offers fertile ground for scholarly naysaying. ¹ Conversely, by striving for a pithy, epigrammatical style, he often plays into the hands of those who are too easily satisfied with easy phrases and half-truths. Indeed, it is rhetorically memorable to assert, as Drucker does, that "most sales training is totally unjustified. At best it makes an incompetent salesman out of a moron." But it also gives heady encouragement to the cavalier dismissal of a perennially knotty problem.

When I was in college, I saw Peter Drucker's books on my father's bookshelf in his home study- The Effective Executive; Management: Tasks, Responsibilities, Practices; and The Practice of Management , among others. I thumbed through them, but at the time, I was more interested in history, biography, literature, and economics. I was thinking about becoming a teacher.

Later, when I was a young Navy officer in Japan, getting my first taste of business by running the retail and service operations at the Navy Exchange in Atsugi, I turned to Peter's books for a crash course in business management. Peter was my coach and teacher. The Navy Exchange Atsugi was my on-the-job training.

In 2000, when I was appointed chief executive of Procter & Gamble, I again turned to Peter-to his writings and to him in person. It was a tough time for the company, and I needed some grounded advice. I made semiannual pilgrimages to the Claremont Colleges in California to talk to him about business and the role of the CEO. I learned many things from Peter over the years, but far and away the most important were the simplest: "The purpose of a company is to create a customer" and "A business....is defined by the want the customer satisfies when he or she buys a product or a service. To satisfy the customer is the mission and purpose of every business."

At P&G we keep Peter's words in mind with every decision. We declared that the consumer-not the CEO-is boss, and made it our purpose to touch more consumers and improve more of each consumer's life. When we look at the business from the perspective of the consumer, we can see the need to win at two moments of truth: First, when she buys a P&G brand or product in a store, and second, when she or another family member uses that product in the home.

We knew that P&G's business model was Sesame Street simple, but deceptively so-typical of the wisdom that was the hallmark of Peter's lifework. By putting customers first, we've nearly doubled the number served, from 2 billion to 3.8 billion; doubled sales; and tripled P&G profits in the first nine years of the twenty-first century.

A.G. Lafley, who served as Procter & Gamble's CEO from 2000 to 2009, is chairman of the company's board of directors.

Sloganeering of either sort, wherever it occurs, is double-edged. Used with care, it allows for a quick, incisive thrust of thought; in the wrong hands, it becomes an effective weapon of simple- or fuzzy-mindedness.

The Influence of Ideas

For the most part, however, Drucker's books command attention neither for their stock of aphorisms nor for their mastery of technical computation. Ears perk up, rather, to catch the wisdom of Drucker's animating ideas. So generally receptive has their audience been and so long-lived their influence that many of his ideas have become part and parcel of today's commonsense understanding of business. As a result, it is not easy-even in retrospect-to achieve critical distance from them.

How remarkably familiar has become his vision of modern industrial society as constituted by large-scale organizations. How obvious it now seems to regard business as the representative institution of that society, and how matter-of-fact an exercise it now is to apply to business the same modes of analysis appropriate to any social or political institution.

Was there a time when people did not regularly ask of individual businesses their source of legitimate authority, their principle of organization, or their pattern of leadership? Was there a time when management felt little need to address employees' concerns for status and function, to fit "knowledge workers" into established structures of decision making and command, or to achieve effective communication in and among managerial levels?

For that matter, did business ever fail to take seriously the recruitment and development of executives, the proper role of boards of directors, or the special needs of companies at different stages of development? Did it fail to pay adequate attention to the internal logic of work itself or to those techniques by which managers can become both more efficient and more effective? Did it ignore such fundamental questions as the nature of the business it was in and of the customers it served?

Today it is hardly front-page news, at least within the business community, when some executive offers a defense of profits as an objective measurement of economic performance or as an essential premium against the risks of the future. Nor is it shocking to hear a call for management to think through long-term strategy as well as to set short-term objectives. A voice recommending that business plan for innovation is no longer a voice crying out in the wilderness.

That none of this seems novel-that it is all quite commonplace-is prime evidence of Drucker's pervasive influence, direct or indirect, on managerial thought. By and large these ideas have long since won acceptance as a kind of professional folk wisdom: They have become home truths.

Drucker's contribution.

To be sure, few of these ideas are original with Drucker. Even fewer have escaped treatment in at least a dozen management texts. Yet there is always a value in reencountering sensible thought sensibly put. But if the substance of his books is neither original nor unique, if what they offer at best is no more or less than the readily paraphrasable content of his thinking, why bother to read them? Why, in short, read Peter Drucker and not a streamlined digest of his major ideas?

The answer is simple: Drucker's real contribution to managerial understanding lies not so much in the cash value of his ideas as in the rigorous activity of mind by which they are formulated. One can learn more-and more deeply-from watching him think than from studying the content of his thought.

Integration of Thought

Most critics assess the substantive contribution of Drucker's works to the discipline of professional management. Yet Drucker's thought is far more valuable for its manner than its matter. First, there is its decidedly integrative quality. To understand essential management tasks, Drucker shows by example that it is necessary to view them in context. One must appreciate the historical universe of traditions and structures out of which they emerged and the cultural universe of norms and values in which they participate. One must know about the many forms capitalism has taken over time and the particular strengths of each form. One must be aware of competing economic ideologies and their underlying premises. In short, one must be able to recognize major shifts in human aspirations as well as the fixed limits of human adaptation .

In the summer of 1989, many of us in nonprofit organizations experienced a defining moment: Right around that time, Harvard Business Review published Peter Drucker's seminal article "What Business Can Learn from Nonprofits." We did a collective double take when we saw that title. Did he really mean to say that nonprofits had useful management principles to share with the likes of GE, IBM, and General Motors? After all those years of being considered junior players? "The best-managed nonprofit is better managed than the best-managed corporation," Drucker had once said, and he had been writing, speaking, and otherwise broadcasting this message for a long time. But with that article he helped redefine and bring new recognition to the social sector as an equal partner of business and government.

It was something of a personal epiphany for me, as well. I was preparing to leave the Girl Scouts of the USA in January, after 13 exuberant years as CEO. My team and I celebrated "What Business Can Learn from Nonprofits" and wanted to promote it widely-and not just because it mentioned our organization. The powerful truths in that piece helped us (and our colleagues in other nonprofit organizations) to better understand ourselves and the world we were trying to change. As Drucker noted later, the term "nonprofit" stated what we were not. We needed, he said, to define ourselves according to what we were : relentlessly focused on, for instance, health-care reform, quality education, and economic prosperity for all. We were, after all, the sector with "the greatest success in meeting social needs."

Soon after leaving the Girl Scouts, I flew to Claremont, California, to meet with Drucker. With me was Bob Buford, a social entrepreneur who was then the CEO and chairman of Buford Television, and Richard Schubert, a former president of the American Red Cross who was shortly to become the president and CEO of the Points of Light Foundation. All of us had been profoundly influenced by Drucker's teachings and wanted to find ways to spread his words and philosophy. Over breakfast we took turns describing our brainstorm, which was to establish the Peter F. Drucker Foundation for Nonprofit Management. Peter listened but gave us no indication of approval or disapproval. ("What are these three up to?" I could imagine him saying to himself.) When we were finished, the room fell silent. Then he said, "We will not name it for me. I am not dead yet, and I do not intend to become an icon." I think it was the only battle he ever lost. Soon thereafter, I found myself CEO of what was then probably the smallest foundation in the world, with no money or staff-just an inspiring vision and Peter on board.

Frances Hesselbein is the chairman of the board of governors of the Leader to Leader Institute (formerly the Peter F. Drucker Foundation for Nonprofit Management).

Then, too, one must be sensitive to the speed, direction, and logic of those technological and demographic changes that will make the future very different from the present. One must, at the same time, carefully ascertain what in the present will last. Not least, one must supplement an understanding of management with insights from other fields of knowledge, regularly comparing it with the summary experience of other large-scale organizations and different cultures.

When brought to bear on even the thorniest of problems, such integrative thinking allows Drucker to identify the key assumptions at issue, to establish their mutual relations, and to evaluate them. Consider, for instance, his lengthy discussion of the curse of bigness in Concept of the Corporation . ² Here Drucker avoids the needless excesses of those who argue either for or against bigness in business by tracing their operative premise to its root and showing it to be grossly misconceived.

Consciously or not, most opponents of bigness, Drucker finds, are in fact tilting against the windmills of monopoly; its defenders, protecting them. Now, monopoly and bigness are, of course, not the same thing and ought not be confused. But Drucker is able to track the point at issue still further to challenge its historical as well as its logical basis. "This theory of monopoly," he writes, "which is still widely accepted as gospel truth, rests on the assumption- correct in the eighteenth century-that supply will always be limited, whereas demand will always be unlimited." ³

This assumption does not always obtain. It may be true of some, but is not necessarily true of all, historical periods. Because Drucker knows the traditional meaning of monopoly and the structural differences between past and present economic conditions, he can refocus an errant discussion.

Other examples suggest themselves. In The End of Economic Man , Drucker comprehends the sense behind the seeming irrationality of fascism's appeal by acknowledging the historical context of its ideas. ⁴ According to Drucker, the Great War and the Great Depression destroyed Europe's already shaken belief in an economic system that was autonomous, governed by rational laws, and productive of both freedom and equality. With the inherited rational world view of classical economics shown to be bankrupt, fascism took powerful hold on the European mind precisely because it was "irrational"-that is, it offered a noneconomic basis for individual status and rank. Drucker reaches the heart of this twentieth-century phenomenon by appreciating the sudden irrelevance of earlier systems of thought.

A similar understanding characterizes his many obiter dicta on Marxism as well as his famous essay on John Maynard Keynes. Drucker writes:

"Keynes's work was built on the realization that the fundamental assumptions of nineteenth-century laissez-faire economics no longer hold true in an industrial society and a credit economy. But it aimed at the restoration and preservation of the basic beliefs, the basic institutions of nineteenth-century laissez-faire politics; above all, it aimed at the preservation of the autonomy and automatism of the market. The two could no longer be brought together in a rational system; Keynes's policies are magic spells, formulae, and incantations, to make the admittedly irrational behave rationally." ⁵

Much the same is true of Marx's thought, which treats as a universal given conditions limited to a brief phase of industrial development.

Technological implications.

Drucker's integrative thinking also illuminates the special obligations imposed by technology on modern business enterprise. From his broad familiarity with the history of industrial development, Drucker can argue in Technology, Management and Society that there has been a massive "overall change in the nature of technological work during [our] century"-a change in its structure, costs, methods, and conceptual underpinnings. ⁶ He is pointedly aware, for instance, that the professional and institutional qualities of technological work are fundamentally new, as are its geometrically increasing requirements for capital expenditures. He can read the implications of the lengthening transition from research to practical application and can see the need for an essentially new relationship between science and technology. He recognizes as well the dangers of the abrupt telescoping of accustomed product life cycles.

But Drucker's thinking rests on an equally broad familiarity with the history of technology. From what he calls the first technological revolution-the appearance in the ancient world of "irrigation cities" and their attendant civilizations-he abstracts a series of lessons that apply with comparable force to the present. Such a revolution, no matter when it occurs, demands major innovation in social and political institutions. Although the form of that innovation must follow the new objective reality created by technological change, the values that shape it and the human ends it is to serve still lie within human control .

When I first met Peter Drucker, 15 years ago, he shared with me ideas that have deeply influenced my work ever since. Chief among them was that beyond just making a profit or creating wealth for stakeholders, the essence of a company is making a difference, being really useful, and creating something the world truly needs.

That higher purpose, Drucker pointed out, has to be something grand-like General Electric's ambition to be, as he put it, "the leader in making science work for humanity"-and not superficial, like so many of the mission statements that companies have nowadays.

Why is such a creed so important? Because without a compelling raison d'être, a company can't hope to tap the full potential of its employees. "The number of people who are really motivated by money is very small," Drucker told me. "Most people need to feel that they are here for a purpose, and unless an organization can connect to this need to leave something behind that makes this a better world, or at least a different one, it won't be successful over time."

Where does that strong sense of company purpose come from? According to Drucker, in every single case it can be traced to an individual, though not necessarily the founder. GE's vision ("Bringing innovative technology to the world") wasn't Thomas Edison's creation; Charles Proteus Steinmetz, a German-American electrical engineer who persuaded GE to create its first laboratory, originated it. As long as this kind of purpose stands, Drucker said, a company will survive and thrive.

Drucker also shared with me that an effective purpose should articulate not only the things that a company will do but also those that it will not do. He held up Johnson & Johnson's one-page credo as a model, because it is among the few that addresses both.

As a management consultant, I still use Drucker's ideas in my work with executives. I usually ask them to ponder the purpose of their organization. What justifies its existence? What things will it do and not do? What important benefits, beyond profits or shareholder value, does it strive to produce? How does it contribute to something the world truly needs? How does every little thing made by the company help it build a positive and constructive legacy?

As they endeavor to answer these questions, executives naturally begin to think about their roles as citizens and human beings. This often helps them not only to become more deeply conscious of the purpose of their work and that of their companies, but also to reinvent the very meaning of their leadership journey.

Oscar Motomura is the founder and CEO of the Amana-Key Group, a management training company based in São Paulo.

Now more than ever, technology demands of business hardheaded adaptation to objective circumstances and increasingly vigilant commitment to ultimate social purposes. Business must clearly understand and meet both obligations to be successful-even to survive-under these modern conditions. It takes Drucker's synthesis of technological and industrial history to bring home so balanced a conclusion.

Decision making in Japan.

Perhaps the most striking instance of this integrative thinking is Drucker's exacting analysis of decision making in Japanese business. ⁷ His use of evidence from so alien a culture commands interest not only in itself but also as it throws American practices into sharper relief. In Japan, Drucker finds, the decision-making process is different from its American counterpart in three essential ways: (1) Decisions, as such, tend to be big ones-that is, they have to do with matters of far-reaching importance; (2) in making them, an inordinate amount of time is allowed for the painstaking achievement of consensus among all those concerned; and (3) once made, they rapidly translate into a course of action-one often radically at odds with previous policy.

From his long acquaintance with the Japanese way of doing things, Drucker knows that this otherwise inexplicable sequence of foot-dragging and full speed makes perfect, if unfamiliar, sense. Unlike American managers, whose decisions typically focus on the merits of a single option and whose concerns are more tactical than strategic, the Japanese take great care first to define the precise nature of the issue at hand. Only then do they methodically review every available course of action. Though this process consumes a great deal of time, it ensures that the decision finally reached has been "presold." With such a consensus established, every concerned manager knows what the decision is, what it means, and what is necessary to make it work.

By contrast, American managers do not as a rule discipline themselves to consider all possible alternatives. More important, they do not regularly force themselves to think through the kind of issue it is that confronts them. As a result their decisions often address symptoms and nearly always have to be "sold" after the fact. Though the compromises made are roughly comparable to those implicit in any Japanese consensus, they are structurally deficient in a way the Japanese ones are not. Coming after the fact, American compromises and the inevitable trade-offs they involve can play havoc with the systematic logic of the original decision; coming before the fact, Japanese compromises are by definition included-and accounted for-within the decision itself.

Context and Logic

The making of decisions in Japan and America, the impact of modern technology, the thought of Keynes and Marx, the appeal of fascism, the curse of bigness-Drucker's mind plays over each of these topics in much the same way. Ideas for Drucker have both an external historical (or cultural) context and an internal logic of argument. The first gives them their shaping assumptions and conceptual vocabulary; the second, their systematic cogency. The first roots them in time and place; the second makes them more generally applicable. The first underscores their relativity; the second stresses their universality. Drucker does not deny the tension between context and logic. Rather, by looking closely at both, he is repeatedly able to define the relevant terms of discussion, reduce them to first principles, uncover improper assumptions or inferences, and identify hidden contradictions.

More specifically, he treats wages and wage policy in such a way as to unmask the quite different starting assumptions of employer and employee. He attacks the arbitrariness of the yearly accounting period, pointing up the great distance between an abstract convention and the reality it is to represent. He shows the typical criteria for promotion within management to be structurally contradictory-that is, in conflict with binding economic objectives. In each instance, Drucker's obstinate refusal to accept conventions at face value allows him to see through them to their formative premises.

Drucker's holism.

This breadth of critical vision is, in turn, an apt expression of an instinctively holistic process of thought. As a number of Drucker-watchers have argued, his mind gravitates neither to the isolated fact nor to the mechanically causal explanation. Instead, Drucker responds most richly to the kaleidoscopic patterns and configurations among facts and to the process-based explanation of their significance. Separate, random data become facts, and isolated facts take on importance only by virtue of their participation in-and relation to-wholes larger than themselves.

Drucker's holism is most readily apparent in The Age of Discontinuity , where he discusses the nonevolutionary "discontinuities" in the modern social universe. ⁸ The explosion of new technologies, the emergence of a truly integrated global economy, the central role of knowledge as an economic resource, and the appearance of countless nongovernmental institutions-all these suggest a radical change in the world as we now know it. They are, in his judgment, like the "drifts that form new continents." They represent massive, but largely hidden, alterations in the very foundations of our lives. The evidence for them lies on all sides, but it takes Drucker's holistic cast of mind to piece them together, to recognize their form, and to assess their import.

The same is true of Drucker's analyses of management proper. For example, his insistence on marketing as the essential, ubiquitous task of management attests to a view of business as a process necessarily oriented toward the creation and satisfaction of customers. Similarly, he extrapolates a few ideal patterns from the mass of individual variations of production and organization principles. In fact, when Drucker writes of the profession of management, he invariably conceives of it as a discipline that teaches its practitioners to identify the constellations of significance in the otherwise chaotic flow of information and circumstance.

Broadly contextual, logical, holistic, Drucker's play of thought-his real contribution to the discipline of management-enacts a kind of ongoing drama of perspective. It does far more than simply impart useful information. It provides a case study in how to think.

Drucker's fair-mindedness.

Drucker's writing is instructive in yet another way. Though often pointed and prescriptive, it rarely loses its tone of calm rationality or strays from its primary commitment to objective analysis. Quite the opposite: It is remorselessly fair-minded . There are, of course, sins in the world-political, social, managerial-that earn Drucker's scorn and contempt, but he gives them all an impartial hearing before pronouncing sentence.

I knew Peter Drucker for 30 years. Aside from the personal career advice he gave me, his view of the responsibility of business to society and of management consultants to clients has had a profound impact on my life.

In 2001 Drucker wrote, "In the half century after the Second World War, the business corporation has brilliantly proved itself as an economic organization. In the Next Society, the biggest challenge...may be its social legitimacy: its values, its mission, its vision." The wave of distrust of business generated by the recent financial crisis has proved how right he was.

Too many business leaders pay lip service to social responsibility. They see it as more about image (which can be delegated to the PR department) than about substance (which is core to strategy). Their predominant concern remains maximizing short-term shareholder value-a narrow focus that Drucker decried. And they continue to pay themselves exorbitant salaries and bonuses-"morally and socially unforgivable," in his words.

Management consultants-being "central to the development of the theory, the discipline, and the profession of management"-as a whole are no better. They focus almost entirely on the economic side of management. All too often cost-cutting and layoffs are their prescriptions.

A root cause of the problem is education. Drucker considered management one of the liberal arts and therefore believed that managers should be educated in the humanities and the social sciences. I wholeheartedly agree. Management innovators have produced an abundance of concepts and tools to help corporations improve their economic performance. Where are the concepts and tools to help them improve their social performance?

As disseminators of knowledge in the business world, management consultants can and should help organizations become better corporate citizens and regain public trust. They should think of themselves as diagnosticians, therapists, and scholars rather than as technicians, Drucker said, and must understand a company's unique competencies, culture, and history. The best way to help a client improve its performance is to build on its strengths, including the best aspects of its culture. He knew that you can discard bad habits, but you can't quickly transform an entrenched culture.

Drucker also believed that a consultant should respect all his clients and remember that he lives off their knowledge. This makes eminent sense: If consultants are to disseminate best practices, they must be not only good teachers but also good students. This doesn't mean that they must shy away from telling clients the truth; on the contrary, the consultant sometimes has to be an "insultant," he said.

The corporation is entering a new era-one in which it will have to reinvent itself not just to compete but also to prove its social legitimacy. As change agents, management consultants will have a critical role to play. Peter Drucker's guidelines can help them play it well.

Peter Paschek is a managing partner of Delta Management Consultants and is based in Berlin.

To some, this unflappable deliberateness proves maddening beyond words. "Yes, yes, get on with it," they murmur impatiently. Yet not "getting on with it," at least in the sense intended, is one of Drucker's most valuable accomplishments. Impatience of mind turns over the authority in argument to the itch of irritation and removes it from the sway of reason. Knowledgeable observers have attributed much of former Canadian Prime Minister Trudeau's long-lived success to his indefatigable derriere, which allowed him in many a meeting to outsit-and therefore out-argue-his less-patient opponents. Not quite so graphically, but every bit as effectively, Drucker's hardened allegiance to the measured pace of reason gives his conclusions an insistent persuasiveness.

When reading Drucker, one responds not only to the fair-mindedness but also to the obvious grace and cultivation of language. His prose is refreshingly literate; his scope of reference, enormous; his offhanded manner of phrasing significant observations, disarmingly and deceptively simple. One is inclined to believe what Drucker says because one trusts the voice doing the saying: It neither threatens nor perplexes but holds out the promise that even the most complicated topics are malleable to experience, orderly thought, and plain good sense.

Consider, for a moment, the following excerpt from Management: Tasks, Responsibilities, Practices . The immediate context is a discussion, perhaps a bit dated, of those situations in which "knowledge professionals" may legitimately receive more in salary than the managers over them:

"There is even an instructive business precedent for this. When Pierre S. du Pont and Alfred P. Sloan, Jr. first attempted, in 1920, to bring order into the chaos of the General Motors Company, they set the same salary for the heads of the operating divisions as for the president, Pierre du Pont. But, at his own request, Sloan received substantially less as the operating vice-president to whom the division heads reported. The manager of a unit composed of career professionals or specialists will, of course, receive more money than most of the men in the unit, but it should not be considered unusual, let alone undesirable, for one or two 'stars' of the group to receive more money than the manager. This can apply as well to salesmen; a star salesman should be expected to make more money than the regional sales manager. It should apply in the research laboratory, and in all other areas where performance depends on individual skill, effort, and knowledge." ⁹

Even when this represented a controversial topic and an even more controversial point of view, Drucker so presented it as to make it appear reasonable and cogent. How does he accomplish this? First, he makes alien ground familiar by citing appropriate precedent from the history of General Motors. Second, he reports the central action (what Sloan did) in such a way ("at his own request") that he transforms an abstract issue of structure into a more tangible one of managerial judgment. Third, he generalizes the assumptions on which Sloan's judgment was founded, translating them back into structural terms. Fourth, he suggests their potential range of application. Finally, he distills from them their essential, defining principle .

When we founded Haier, in the 1980s, virtually all products were in short supply in China, and the key to reaping huge profits seemed to be maximizing sales. The vast majority of companies behaved accordingly and strove to get whatever products they could into the market. But at Haier we realized that a sole focus on generating huge profits today could not ensure our survival tomorrow. So we chose to focus on quality instead. Initially this approach made us appear to be falling behind competitors whose profits dwarfed ours. But when the supply-demand balance in China changed, lots of companies lost their customers and went bankrupt overnight. In contrast, we not only survived but strengthened our market position. We took to heart Peter Drucker's words "There is only one valid definition of business purpose: to create a customer."

Today, a big challenge is how to create customers in the era of the internet. Once again, Drucker helped us find the answer. He said, "In the mental geography of e-commerce, distance has been eliminated." This insight prompted us to explore how we could eliminate the distance between us and our customers. The result was an internet and telephone marketing network and a physical logistics and services network that allow Haier to excel in ascertaining customers' needs and in rapidly delivering products and after-sale services in both rural and urban areas all over the country.

Another step we've taken is to invert our traditional organizational pyramid. China is so big and diverse-its districts are as different as nations-that only people on the front lines can have a deep understanding of customers' needs. Therefore, employees who directly face customers should be at the top, and senior executives should support them so that they can deliver on their commitments to customers.

Finally, we're trying to get closer to customers by embracing the just-in-time model, which requires us to align all of our systems and processes with customer needs. Zero inventory is our goal. We've already reduced inventory turnover time to under five days, which is less than one-tenth the average in China's household-appliances industry. This hasn't been easy. But we feel we have to do it to differentiate ourselves. Many companies are engaged in selling their inventories; we are truly selling service.

There is one picture on my desk: the sinking Titanic. I wrote on it these words from Drucker about why companies find themselves in crisis: "The assumptions on which the organization has been built and is being run no longer fit reality." It's a constant warning: All decisions I make must be consistent with the ever-changing external environment. If they aren't, the consequences may not emerge right away, but once danger shows up, it will be too late: Like the Titanic, my company will have no time to change course.

Zhang Ruimin is CEO of the Haier Group and is based in Qingdao, China.

Drucker's process of discussion, then, is to establish relevant precedent, make it comprehensible in human terms, articulate its organizational implications, define its limits, and make clear what it is really about. His mind plays over the issue at hand, looking at it from various perspectives, indicating now this, now that aspect of importance. Drucker engages the reader by a tour de force of reflection but convinces him, if at all, by a tone of responsible authority and a commonsense flow of reasoning.

Rhetorical firepower.

Such are the mechanics of a typical piece of Drucker's prose. He does not drag the reader kicking and screaming toward some undesired conclusion. To the contrary, he gently takes him by the arm and walks about with him until his conclusion appears a most reasonable place to go. His step along the way is usually calm, measured, deliberate. But not always. Every now and then he breaks into a flag-waving charge up some rhetorical San Juan Hill. Here, for instance, is Drucker in full stride on the issue of profits:

"In fact, the concept [the all-too-familiar equation of profits with the profit motive] is worse than irrelevant: it does harm. It is a major cause for the misunderstanding of the nature of profit in our society and for the deep-seated hostility to profit which are among the most dangerous diseases of an industrial society. It is largely responsible for the worst mistakes of public policy-in this country as well as in Western Europe-which are squarely based on the failure to understand the nature, function, and purpose of business enterprise. And it is in large part responsible for the prevailing belief that there is an inherent contradiction between profit and a company's ability to make a social contribution. Actually, a company can make a social contribution only if it is highly profitable. To put it crudely, a bankrupt company is not likely to be a good company to work for, or likely to be a good neighbor and a desirable member of the community-no matter what some sociologists of today seem to believe to the contrary." ¹⁰

There are no two ways about it: This is angry, immoderate prose. True, its immediate context is a reasoned discussion of the logical difference between terms like the "profit motive," which refer to psychological realities, and terms like "profitability," which refer to abstract standards of entrepreneurial measurement. And true, its more general context is the group of passages scattered throughout Drucker's works that argue a strong case for profits as an essential premium against the risks of the future.

Nevertheless, this is angry prose. Its incremental rhythms are those of the pulpit; its logic collapses long sequences of cause and effect into simple trigger mechanisms; its dismissive tone gives no quarter to doubters. It may be a significant departure from Drucker's rhetorical norm, but it is neither accidental nor ineffective. It is flag-waving with a purpose.

As Drucker well knows, language instructs and animates not only by convincing the reason but also by breaking down or through a recalcitrant will. When the stakes are high enough and the intellectual stubbornness of some in his audience great enough, Drucker will take the reader by force, breaching accustomed defenses with sheer rhetorical firepower. He does not often make such an attempt, but he is a good enough verbal tactician to carry it off when he does.

Moral Concerns

Even with passages like this in front of them, a number of Drucker's critics have taken him to task for what they see as a conspicuous lack of passion in his thought, a certain detachment from his material. They are quite wrong. There is an immense difference between a dispassionate and a nonpassionate intelligence. Drucker's studied objectivity reflects a genuine commitment to dispassionate, though hardly nonpassionate, reason. Indeed, much of his thought reflects a terrible urgency of moral purpose. Drucker is so deeply concerned about the profession of management because he is profoundly afraid of what might happen if the major institutions of Western society fail in their essential responsibilities.

As any halfway attentive reader of Drucker's earlier books or his recent autobiography cannot help but notice, the lessons of fascism in Italy and national socialism in Germany have not been lost on him. That traumatic passage of history is continually present to his mind in a way simply not possible for other writers on management who are both younger in years and American by birth. (Drucker was born in Vienna, Austria, in 1909.) They can never share the shattering immediacy of his sense of the price paid by twentieth-century society for institutional failure.

In today's world, Drucker believes, the human freedoms most genuinely cherished depend to a great extent for their protection on large-scale organizations. When successful, those organizations allow for a large measure of the human fulfillment now available to Western man. They provide the main stage for achievement of personal freedom and for assumption of responsibility through self-control. If the institutions of business cannot meet the cumulative needs of economic performance, society, and the individual, nothing stands between any of us and the forces of chaos and terror. No wonder, then, that Drucker puts such great emphasis on the character of managers and on the immense responsibilities they bear.

What to Read

Given the disposition to read Drucker, but with limited time, to which of his books should you turn? The choice is unusually difficult because Drucker has not only written many, but many different kinds of books. They do, however, fall roughly into four separate groupings: social and political thought, analyses of the profession of management and of the institutions of business, informed speculations on those contours of the future already visible in the present, and how-to primers for certain business-related tasks. Some titles, of course, fit into more than a single grouping; a few do not fit neatly into any of them.

First among the books of social and political thought is The End of Economic Man , Drucker's remarkably evenhanded treatment of twentieth-century European fascism. Two further publications complete the cycle of thought there begun: The Future of Industrial Man , ¹¹ which addresses the central problem of legitimate authority in modern institutions, and The New Society , ¹² which sketches an idealized vision of industrial citizenship. Men, Ideas and Politics , one of Drucker's several collections of essays, offers a certain number of grace notes, including novel reflections on Søren Kierkegaard, John C. Calhoun, and Henry Ford.

The books on management proper also form a cycle of thought. Concept of the Corporation is Drucker's pathbreaking study of General Motors. The Practice of Management ¹³ and Management: Tasks, Responsibilities, Practices are perhaps his two most famous contributions to the study of management as a professional discipline.

In the third group fall two collections of essays, America's Next Twenty Years ¹⁴ and Technology, Management and Society , as well as Landmarks of Tomorrow , ¹⁵ all of which pretty much deliver what their titles suggest. The Age of Discontinuity identifies and assesses radical changes in the foundations of the modern world. By contrast, The Unseen Revolution -much faulted as it has been for confusing ownership with control-considers a different, though no less radical, sort of change: the development of what Drucker calls "pension fund socialism" in America. ¹⁶

Finally, there are the how-to books: Managing for Results , with its emphasis on tactics for improving economic performance, and The Effective Executive , ¹⁷ with its suggestions for making executives more effective managers of both themselves and others.

Drucker's most recent book, his autobiographical Adventures of a Bystander , belongs to none of these categories. ¹⁸ No matter. The cast of characters among whom Drucker moves, especially in the European chapters, is superbly rich, and the informed glimpse he provides of a vanished social and political universe is an education in itself. Adventures is often better than a novel, more lively than an essay, and as thoughtful as both at their best. The Age of Discontinuity is in the same class. This, too, offers pleasure reading, albeit of a different sort. It is becoming ever more important for top managers to think productively about the significant shape of the future, and Discontinuity provides an endlessly provocative model for doing so.

If ever there is time enough and the mood of reflection is with you, work your way slowly through The Future of Industrial Man . This is Drucker's vision of the central problems facing industrial society-those of freedom and legitimacy-which do not appear nightly on the television news.

Most important of all is The Practice of Management , Drucker's best book on the managerial profession. Far more crisp than the larger compendium on Management , nicely balanced between precept and example, this book is eminently practical yet of genuine intellectual breadth. If Drucker's work holds anything of immediate value for you, you will most likely find it here.* * *

Remember, however, that the greatest value of reading Drucker consists in a sustained exposure to the disciplined activity of his mind-and not merely to the paraphrasable substance of his ideas. The ideas, of course, are there in abundance and are certainly worth close attention. But as Dr. Johnson (that great eighteenth-century humanist) well understood, the truly important thing with books is not to pluck their individual blossoms but to "grasp the Trunk hard only, and you will shake all the branches." In the work of Peter Drucker, grasp hard the discipline of mind.

To read more on Peter Drucker's legacy, please visit: http://hbdm.harvardbusiness.org/hbr/drucker/index.html

A version of this article appeared in the November 2009 issue of Harvard Business Review.

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The Idea in Brief * Peter Drucker's extensive, thoughtful writing about the management of organizations has garnered both zealous disciples and dismissive critics. * The point with Drucker is to read not primarily for the ideas, though they are both useful and interesting, but rather to learn from the way he thinks.

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A good read regarding ethics in the workplace with another inspiring photo showing work diversity.

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If workers trust their employer to treat them fairly, they'll be happier about their jobs. Workplace ethics translate into a better work life for employees and a more motivated, loyal team for the employer. By contrast, a company that turns a blind eye to unethical activity could make itself vulnerable to losing key staff or even to a lawsuit. On top of all that, ethical business conduct is the right thing to do.

A Happier Workplace

Running a company along ethical lines and training staff to treat each other ethically is a win for employer and employees alike. If a company doesn't put up with bad behavior, such as harassment or discrimination, employees can enjoy work more. That's good for them and also for the company. Keeping employees happy reduces turnover, increases productivity and makes it easier to attract talented new hires.

Staying Within the Law

When supervisors or employees break the law, they're also acting unethically. If the company insists everyone do the right thing, that keeps operations inside the legal lines. This includes not only "sins of commission," such as selling defective products, but sins of omission - situations where it seems easier just to sit back and do nothing. If you report a sexual harassment case to your manager, and he ignores your complaint, his behavior can get the company in legal hot water.

Better Public Image

Being caught committing or tolerating unethical or criminal acts can cripple a company's image. There are several 21st-century cases in which executives learned that their staff was defrauding customers yet they took no action. Acting unethically gave the companies a bad reputation, and also cost some millions in fines or legal settlements.

Creating a Better Company

Many of the best management practices are easier to achieve if the company acts ethically. Good behavior makes it easier for managers and employees to trust each other, and for investors to trust company management. Hiring and promoting employees fairly without placing discrimination leads to a more diverse workplace and a more diverse management team. Diversity in any given company encourages different ways of looking at problems and finding solutions, which strengthens company operations.

Better for Everyone

It's not just the workers and the company who benefit from ethics. Customers benefit if they know the products or services they buy are safe and dependable. The economy benefits when companies refrain from using dirty tricks to crush competitors.

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The Benefits & Importance of Ethics in the Workplace

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If workers trust their employer to treat them fairly, they'll be happier about their jobs. Workplace ethics translate into a better work life for employees and a more motivated, loyal team for the employer. By contrast, a company that turns a blind eye to unethical activity could make itself vulnerable to losing key staff or even to a lawsuit.

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Included a more visual photo of vertical management. In your day to day work it is hard to remember the ladder and how what you do every day is the effect coming from above.

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While reading about Henri Foyal in module 1 I wanted to learn more about him. I did some more research and came across his 14 principles of management. They are very interesting and applicable still to this day. The one that stood out to me was "Espirit De Corps" stands for striving for the involvement and unity of the employees. I firmly believe the success of any company is fueled by the communication and morale in the workplace.

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Today's managers have access to an amazing array of resources which they can use to improve their skills. But what about those managers who were leading the way forward 100 years ago?

Managers in the early 1900s had very few external resources to draw upon to guide and develop their management practice. But thanks to early theorists like Henri Fayol (1841-1925), managers began to get the tools they needed to lead and manage more effectively. Fayol, and others like him, are responsible for building the foundations of modern management theory.

Background

Henri Fayol was born in Istanbul in 1841. When he was 19, he began working as an engineer at a large mining company in France. He eventually became the director, at a time when the mining company employed more than 1,000 people.

Through the years, Fayol began to develop what he considered to be the 14 most important principles of management. Essentially, these explained how managers should organize and interact with staff.

In 1916, two years before he stepped down as director, he published his "14 Principles of Management" in the book " Administration Industrielle et Générale." Fayol also created a list of the six primary functions of management, which go hand in hand with the Principles.

Fayol's "14 Principles" was one of the earliest theories of management to be created, and remains one of the most comprehensive. He's considered to be among the most influential contributors to the modern concept of management, even though people don't refer to "The 14 Principles" often today.

The theory falls under the Administrative Management school of thought (as opposed to the Scientific Management school, led by Fredrick Taylor).

Fayol's 14 Principles of Management

Fayol's principles are listed below:

1. Division of Work - When employees are specialized, output can increase because they become increasingly skilled and efficient.

2. Authority - Managers must have the authority to give orders, but they must also keep in mind that with authority comes responsibility.

3. Discipline - Discipline must be upheld in organizations, but methods for doing so can vary.

4. Unity of Command - Employees should have only one direct supervisor.

5. Unity of Direction - Teams with the same objective should be working under the direction of one manager, using one plan. This will ensure that action is properly coordinated.

6. Subordination of Individual Interests to the General Interest - The interests of one employee should not be allowed to become more important than those of the group. This includes managers.

7. Remuneration - Employee satisfaction depends on fair remuneration for everyone. This includes financial and non-financial compensation.

8. Centralization - This principle refers to how close employees are to the decision-making process. It is important to aim for an appropriate balance.

9. Scalar Chain - Employees should be aware of where they stand in the organization's hierarchy, or chain of command.

10. Order - The workplace facilities must be clean, tidy and safe for employees. Everything should have its place.

11. Equity - Managers should be fair to staff at all times, both maintaining discipline as necessary and acting with kindness where appropriate.

12. Stability of Tenure of Personnel - Managers should strive to minimize employee turnover. Personnel planning should be a priority.

13. Initiative - Employees should be given the necessary level of freedom to create and carry out plans.

14. Esprit de Corps - Organizations should strive to promote team spirit and unity.

Fayol's Six Functions of Management

Fayol's six primary functions of management, which go hand in hand with the Principles, are as follows:

Key Points

Henri Fayol's "14 Principles of Management" have been a significant influence on modern management theory. His practical list of principles helped early 20th century managers learn how to organize and interact with their employees in a productive way.

Although the 14 Principles aren't widely used today, they can still offer guidance for today's managers. Many of the principles are now considered to be common sense, but at the time they were revolutionary concepts for organizational management.

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Henri Fayol's Principles of Management: Early Management Theory

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Today's managers have access to an amazing array of resources which they can use to improve their skills. But what about those managers who were leading the way forward 100 years ago? Managers in the early 1900s had very few external resources to draw upon to guide and develop their management practice.

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Diversity in the workplace is essential. Will continue to grow and learn how to best incorporate it into the workplace and an inspiring photo with a diverse team.

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Therefore many execs have no problem embracing policies, initiatives, and tools designed to increase levels of diversity among employees. A diverse workforce, however, is just the first step.

That's because diversity in the workplace does not necessarily mean inclusivity in the workplace. Yes, making diversity a priority is important; but so is the next logical step: creating a culture where people from all backgrounds feel . Inclusivity is the key to actually maintaining (not just creating) diversity in the workplace.

When it comes to establishing and following through on a commitment to diversity and inclusion, however, you can have a big impact. Here are the top 15 ways you can support inclusion and diversity in your workplace.

1. Use the "Inclusive Workplace Model"

What's the difference between diversity and inclusion in your workplace ? If your company doesn't score high inclusivity marks, you risk alienating some of your workforce.

For example, consider the employee who's a native Spanish speaker but doesn't feel entirely comfortable to speak any language other than English in workplace common areas. Or the breastfeeding mother just returning to work who has no space to pump her breast milk. Or the Muslim employee who feels insecure about maintaining his daily prayer routine on company grounds.

When your employees feel they have to hide or mask core parts of themselves at work because they feel unsure, unsafe, or invisible, it can take a toll on motivation, engagement, and (ultimately) employee retention and turnover rates.

Diversity in the workplace statistics show that most companies desperately need to consider aspects of inclusivity as part of their efforts to create a workforce that reflects a variety of backgrounds and experiences.

When your employees feel they have to hide or mask core parts of themselves at work because they feel unsure, unsafe, or invisible, it can take a toll on motivation, engagement, and (ultimately) employee retention and turnover rates.

2. Evaluate your executive team - Do they portray diversity and inclusion?

How diverse is your executive team?

The makeup of your executive team is a huge signifier to the rest of your workforce (not to mention your customers, partners, and other stakeholders). The top management of a company speaks volumes about your culture.

Accordingly, it is essential to have diversity among top management that is diverse. Are men and women equally represented? What about people from various cultural and religious backgrounds?

As an HR professional, you may not have much control over your executive team; but if you do have the means to make a case about diversity and inclusion to the C-suite, you should. And you can help your executives communicate with employees authentically and transparently.

A survey report from Boston Consulting Group (BCG) found among the Fortune 500 companies, only 24 CEOs are women, which represents just 5% of the total number of CEOs.

3. Acknowledge and honor multiple religious and cultural practices.

Introduce a policy for honoring a variety of cultural and religious practices.

You can do this by focusing on holidays and celebrations. This article suggests designating a special refrigerator to keep Kosher food items separate, for example. And the Society of Human Resource Management (SHRM) notes some companies still give Christmas Day off, but also offer " floating holidays " to accommodate the religious preferences of all employees. (Speaking of Christmas, make your holiday party nondenominational.)

4. Foster a company culture where every voice is welcome, heard, and respected.

Employees need to feel free to express themselves based on their unique perspectives. Companies must make sure employees feel included and respected regardless of their

When it comes to supporting diversity and inclusion in the workplace, don't play favorites, practice basic courtesy, and pay special attention to how you can embrace non-discriminatory practices and policies. Employees feel included when they feel "safe" to voice their concerns and opinions without fear of victimization. The freedom of expression without fear also empowers companies to not just listen to but also actively embrace diverse viewpoints.

5. Open a dialogue about gender pay inequality.

Want a culture of inclusion built on trust and transparency? Get ready to talk about gender and potential pay disparities, and possibly reveal some of the company's data points around compensation.

Gender pay equity is a big point of contention at many companies. Workforce trust and a sense of inclusion are built around a company's transparency in its policies and communication about those policies. For companies that have gender pay imbalance, it is important to open the communication channels so that employees can give their feelings and opinions. Additionally, present to them with clarity, the strategy the company is or will be using to address the gap. That way, they will feel safe knowing that the company is committed to taking action to bridge the gender pay gap.

It is crucial to avoid being defensive in presenting your company's data around such policies. If data is skewed for a variety of factors (such as maternity leave vs. untaken paternity leave, for example), explain this the employees in a straightforward, clear way.

Gender pay equity is a big point of contention at many companies. Workforce trust and a sense of inclusion are built around a company's transparency in its policies and communication about those policies.

6. Welcome a multilingual workforce.

Imagine being part of a working environment where almost everyone regularly speaks a language not native to you?

If you truly want everyone to feel included, make sure you take into account language barriers and preferences. Global companies deal with this sort of thing all the time; let's say they have different teams, working in different countries, speaking the same language ... but they want to invite all those teams to participate in a virtual event. What language should be spoken by the person who introduced that event? What language will your CEO make her speech in?

Global companies know to offer translation services so that everyone can understand what's being said and also feel included. (If the CEO speaks multiple languages, she might opt to leverage that in her speech as well.) But just as important in small companies is simply to make sure everyday employees feel secure and comfortable communicating in whatever language they find most suitable for them, especially in common areas or during company-sponsored or sanctioned events.

As a long-term approach, having a multilingual workforce may call for educational opportunities for workers to learn other languages. This might sound prohibitively expensive but think of it as an investment that yields returns in due time.

It is also a good idea to consider applicants' language skills during the recruitment process. For example, with the same qualifications, it might make more sense to hire an individual who speaks more than one language.

7. Foster diverse thinking.

When you make an effort to hire for diversity, you put your company in a good position to think in culturally diverse ways. But for diverse viewpoints to really stick, you must account for inclusivity.

This is important because different people from different backgrounds and generations sometimes have vastly different perspectives on all sorts of issues, from what they choose to wear to work, to how they compose an email, to the kind of feedback they give on employee reviews, to what kinds of ideas they pitch in meetings. So it's not just important for an individual employee or even a small team or department to understand thinking patterns; it's also important that they know and understand how other people at the company think.

Embracing diverse thinking is useful in generating ideas and getting useful feedback while at the same time creating an environment where everyone feels relevant and part of a shared mission.

8. Build a multigenerational workforce.

You can really see this at work in communications practices. Sometimes certain employees are more comfortable using social channels, for example, or group chat functions. On the other hand, employees of older generations might not embrace such communications channels so readily.

Again, communications professionals can invest in a workforce communications platform to easily and efficiently create and send messages via channels that employees prefer; this will help communicators craft messages that will appeal to all generations, and encourage engagement.

Having a workforce that recognizes and accommodates multiple generations is essential in building a diverse and inclusive workforce.

9. Reflect everyone's needs and preferences at everyday gatherings.

In addition to holiday parties, many offices celebrate minor holidays (like Halloween) or events like birthdays. Whenever you have even a casual company event, be sure to include food and beverages that everyone can eat and drink. For instance, include both alcoholic and non-alcoholic drinks during events, and you may want to avoid hosting offsite events at bars. (Happy hours can be held in bar/restaurant spaces.)

Also, not everyone likes to celebrate birthdays, so be sure to ask the employee what he or she prefers (and never reveal the employee's age or year of birth). Make sure employees know such events are optional. For example, some employees may suffer from intense shyness and would panic at the thought of having to attend a work-sponsored karaoke event.

This doesn't mean you have to forgo small, ordinary celebrations altogether. But asking proper questions about preferences and offering a variety of food and drink options will go a long way in making such experiences more inclusive.

10. Strengthen anti-discriminatory policies.

11. Make your workspaces inclusive.

You can establish gender-friendly bathrooms and restrooms and also set up dedicated nursing rooms for mothers. (Mothers should not have to book a conference room or hide in the bathroom.) A nursing room needs a door that locks, a comfortable chair, covered windows, proper ventilation, and a special refrigerator to store the pumped milk.

12. Eliminate bias in the evaluation process and promotion opportunities.

A large body of shows that the hiring process is unfair and full of bias. Much of it is unconscious sexism, racism, and ageism. If left unchecked, it can harm your company. Iris Bohnet, director of the Women and Public Policy Program at the Harvard Kennedy School and author of What Works: Gender Equality by Design explains, "Seeing is believing... If we don't see male kindergarten teachers or female engineers we don't naturally associate women and men with those jobs, and we apply different standards" when we hire, promote, and evaluate job performance. "Managers have to learn to de-bias their practices and procedures."

Some strategies to combat bias include:

Rewriting job descriptions so they are gender neutral and use words that strike a balance of gendered descriptors and verbs

Create a blind system of reviewing resumes so you don't see "demographic characteristics"

Set diversity goals as an organization, which will help you track your progress

13 Segment employee engagement surveys by minority groups.

The annual pulse survey is common among companies, but many neglect to segment that data according to gender, generation, ethnicity, geography, and others. By only looking at total numbers, HR pros may miss the whole picture and an opportunity to identify issues pertaining to those groups.

14. Use independent groups to conduct focus groups.

Focus groups are a good way to collect qualitative data and gain deeper insights into employees. By using an outside facilitator, employees may be more comfortable speaking freely, and the outside company will maintain a neutral position.

15 Personalize one-on-one discussions.

One of the best ways to learn what employees care about is one-on-one talks with their manager. In order for these discussions to truly be effective, managers must have an "open door" policy. Workers need to feel comfortable in speaking their mind honestly and openly.

Inclusion in the workplace
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15 Ways to Improve Diversity and Inclusion in the Workplace

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Therefore many execs have no problem embracing policies, initiatives, and tools designed to increase levels of diversity among employees. A diverse workforce, however, is just the first step. That's because diversity in the workplace does not necessarily mean inclusivity in the workplace.