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Drucker Perspective

The Secret to Building an Opportunity-Focused Organization

MMN
Contributor: Management Matters
Posted: 07/13/2017

It's an enduring truth: A successful organization is opportunity-focused, not problem-focused.

Resources, to produce results, must be allocated to opportunities rather than problems. This is one of Peter F. Drucker's most important principles for sustained success:

"An organization will have a high spirit of performance if it is consistently directed toward opportunity rather than toward problems. It will have the thrill of excitement…Of course, problems cannot be neglected. But the problem-focused organization is an organization on the defensive. It is an organization that feels it has performed well if things do not get worse.

A management that wants to create and maintain the spirit of achievement therefore stresses opportunity. But it will also demand that opportunities be converted into results."

A Sad But True Observation

Many executives prefer to "put out fires" rather than focus on opportunities. Many of the "fires" they so superbly extinguish usually boils down to problems they've created. This keeps them busy but not necessarily very productive.

Drucker, in Adventures Of A Bystander, tells us how the legendary chairman of General Motors, Alfred D. Sloan, was very aware of this truism: "Decisions on people usually provoked heated debate in the GM executive committee. Once, the whole GM committee seemed to be agreed on one candidate for president of an operating division, 'who had handled this crisis superbly, solved that problem beautifully and quenched yonder fire with great aplomb.'

Mr. Sloan, finally, broke in. "A very impressive record your Mr. Smith has, he said, 'but do explain to me how he gets into all these crises he then so brilliantly surmounts? ' Nothing more was ever heard of Mr. Smith."

Needed: Opportunity Meetings

People see what is presented to them; what is not presented tends to be overlooked. Drucker noted that most meetings discuss "problems" -- especially in the areas where performance falls below expectations--which means that managers tend not to see the opportunities. They're simply not being presented with them.

Drucker said again and again: "Of course, problems have to be paid attention to, taken seriously, and tackled...But if they are the only thing that is being discussed, opportunities will die of neglect."

Many organizations have two meetings. One meeting to discuss and solve problems. Another meeting to identify and focus on opportunities. You should integrate the "opportunity meeting" into your management practices. It works wonders.

Assigning First-Rate Resources to First-Rate Opportunities

Drucker could not have been more emphatic: One never assigns first-class people to anything but major opportunities.

Yet this does not happen in many organizations because they are oriented toward "feeding the problems and starving the opportunities." In short, they're not really opportunity-focused. They only talk about it but don't do it.

Problem-solving only leads to damage containment. Only opportunities produce results and growth. It takes years to incorporate this Drucker-inspired thinking into your organization's DNA.

Most decidedly, you must start asking the following set of Drucker questions:

1. Who are your best-performing people?

2. What are they assigned to?

Almost without exception, said Drucker, “the performers are assigned to problems––to the old business that is sinking faster than had been forecast; to the old product that is being outflanked by a competitor's new offering; to the old technology––for example, analog switches, when the market has already switched to digital."

Drucker always stressed the question: "Who takes care of the opportunities?" Almost invariably, he observed, the opportunities are left to fend for themselves. Not good.

Another Drucker Practice for Identifying and Capitalizing on Opportunities

He advised managers to draw up a list of opportunities that businesses could undertake, and make sure each can be adequately staffed. "Only then should you draw up a list of the problems and worry about staffing them,” he said. 

Drucker gave the case of General Electric under the leadership of Jack Welch. Welch decided to get rid of all businesses––even profitable ones––that did not offer long-range growth and the opportunity for the company to be top first or second in the global marketplace.

And then GE placed its best performing people in the opportunity businesses, and helped GE reach new heights. Welch made GE into an opportunity-focused organization with this and other Drucker teachings.

In Conclusion: becoming opportunity focused requires work and thinking. It requires more than slogans. It requires practices that can be practiced.

Hopefully, these Drucker principles will transform your organization's mindset to be truly opportunity-focused.

MMN
Contributor: Management Matters
Posted: 07/13/2017