Quotes by Peter Drucker

The best way to predict the future is to create it.

Great wisdom not applied to action and behavior is meaningless data.

Efficiency is doing the thing right. Effectiveness is doing the right thing.

People who don't take risks generally make about two big mistakes a year. People who do take risks generally make about two big mistakes a year.

Knowledge applied is productivity.

Leadership is lifting a person's vision to high sights, the raising of a person's performance to a higher standard, the building of a personality beyond its normal limitations.

Leaders grow; they are not made.

The leader sees leadership as responsibility rather than as rank and privilege.

If you want something new, you have to stop doing something old.

The most important thing in communication is hearing what isn't said.

The entrepreneur always searches for change, responds to it, and exploits it as an opportunity.

Management is doing things right; leadership is doing the right things.

Teamwork is neither good nor desirable.It is a fact. Wherever people work together or play together they do so as a team. Which team to use for what purpose is a crucial, difficult and risky decision that is even harder to unmake. Managements have yet to learn how to make it.

In every success story, you will find someone who has made a courageous decision.

Replace your pursuit of success with the pursuit of contribution.

Concentration is the key to results. No other principles of effectiveness is violated as constantly today as the basic principle of concentration.

Concentration is the key to economic results. No other principles of effectiveness is violated as constantly today as the basic principle of concentration.

There is only one ethics, one set of rules of morality, one code: That of individual behavior in which the same rules apply to everyone alike.

The real achiever does one thing at a time.

Effective leadership is not about making speeches or being liked; leadership is defined by results, not attributes.

There is only one valid definition of business purpose: to create a customer.

Executives of necessity live and work within an organization. Unless they make conscious efforts to perceive the outside, the inside may blind them to the true reality.

Profit is not the purpose of a business, but rather the test of its validity.

People learn the most when teaching others.

Results are obtained by exploiting opportunities, not by solving problems.

The real achiever do one thing at a time.

Marketing is the distinguishing, unique function of the business.

Unless commitment is made, there are only promises and hopes; but no plans.

Managing innovation will increasingly become a challenge to management, and especially to top management, and a touchstone of its competence.

There are only two things in a business that make money -- innovation and marketing, everything else is cost.

Making changes to better appeal to customer is INNOVATION.

Because its purpose is to create a customer, the business has two and only two functions: Marketing and Innovation. Marketing and Innovation produce results. All the rest are costs.

It's more important to do the right thing than to do things right.

A man should never be appointed into a managerial position if his vision focuses on people's weaknesses rather than on their strengths.

The companies that refused to make hard choices, or refused to admit that anything much was happening, fared badly. If they survive, it is only because their respective governments will not let them go under.

Long range planning does not deal with future decisions, but with the future of present decisions.

Your first and foremost job as a leader is to take charge of your own energy and then help to orchestrate the energy of those around you.

Efficiency is doing better what is already being done.

There is nothing quite so useless as doing with great efficiency something that should not be done at all. Peter F.

Leaders shouldn't attach moral significance to their ideas: Do that, and you can't compromise. Peter F.

To be more requires a man who is conceited enough to believe that the world really needs him and depends on his getting into power. Peter F.

The test of organization is not genius. It is its capacity to make common people achieve uncommon performance. Peter F.

Management is doing things right. Leadership is doing the right things.

Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window. Peter F.

To make the future is highly risky. It is less risky, however, than not to try to make it. Peter F.

In every success story, you will find someone who has made a courageous decision. Peter F.

Nobody can predict the future; the idea is to have a firm grasp of the present. Peter F.

There are no creeds in mathematics. Peter F.

If you want something new, you have to stop doing something old. Peter F.

Plans are only good intentions unless they immediately degenerate into hard work. Peter F.

The one person to distrust is the one who never makes a mistake. Either he is a phony, or he stays with the safe, the tried, and the trivial.

Replace your pursuit of success with the pursuit of contribution.

There is a point of complexity beyond which a business is no longer manageable.

People who need certainty are unlikely to make good entrepreneurs.

The enterprise, by definition, must be capable of producing more or better than all the resources that comprise it.

A business enterprise must continue beyond the lifetime of the individual or of the generation to be capable of producing its contributions to economy and to society.

Business enterprise is an organ of society. There is only one valid definition of business purpose: to create a customer.

The enterprise can fulfill its human and social functions only if it prospers as a business.

The essence of management is to make knowledge productive.

Management by objectives works if you first think through your objectives. Ninety percent of the time you haven't.

Unless commitment is made, there are only promises and hope... But no plans.

Charisma becomes the undoing of leaders. It makes them inflexible, convinced of their own infallibility, unable to change.

Business, that's easily defined -- it's other people's money.

Listening (the first competence of leadership) is not a skill, it is a discipline. All you have to do is keep your mouth shut.

There are no creeds in mathematics.

Adequacy is the enemy of excellence.

It is willingness of people to give of themselves over and above the demands of the job that distinguishes the great from the merely adequate.

We have only one alternative: either to build a functioning industrial society or see freedom itself disappear in anarchy and tyranny.

Capitalism is being attacked not because it is inefficient or misgoverned but because it is cynical. And indeed a society based on the assertion that private vices become public benefits cannot endure, no matter how impeccable its logic, no matter how great its benefits.

Thus, for those who are willing to go out into the field, to look and to listen, changing demographics is both a highly productive and a highly dependable innovation opportunity.

If analysis shows that someone's brilliant work fails again and again as soon as cooperation from others is required, it probably indicates a lack of courtesy -- that is, a lack of manners.

Economists think the poor need them to tell them that they are poor.

In all recorded history there has not been one economist who has had to worry about where the next meal would come from.

Doing the right thing is more important than doing the thing right.

People are effective because they say no.

An established company which, in an age demanding innovation, is not able to innovation, is doomed to decline and extinction.

It takes far less energy to move from first-rate performance to excellence than it does to move from incompetence to mediocrity.

The task of leadership is to create an alignment of strengths so strong that it makes the system's weaknesses irrelevant.

There's no such thing as knowledge management;

there are only knowledgeable people.

Information only becomes knowledge

in the hands of someone

who knows what to do with it.

If war production should remain the only way out of a long-term depression, industrial society would be reduced to the choice between suicide through total war or suicide through total
depression.

One should waste as little effort as possible on improving areas of low competence. It takes far more energy and work to improve from incompetence to mediocrity than it takes to improve from first-rate performance to excellence.

So much of what we call management consists in making it difficult for people to work.

Information is the manager's main tool, indeed the manager's capital, and it is he who must decide what information he needs and how to use it.

Morale in an organization does not mean that people get along together; the test is performance not conformance.

The new always looks so puny-so unpromising-next to the reality of the massive, ongoing business.

Any organisation develops people; it either forms them or deforms them.

The company is not and must never claim to be home, family, religion, life or fate for the individual. It must never interfere in his private life or his citizenship. He is tied to the company through a voluntary and cancellable employment contract, not through some mystical or indissoluble bond.

As a manager you're paid to be uncomfortable. If you're comfortable, it's a sure sign you're doing things wrong.

Don't solve problems. Pursue opportunities.

Never underrate the boss! The boss may look illiterate. He may look stupid. But there is no risk at all in overrating a boss. If you underrate him he will bitterly resent it or impute to you the deficiency in brains and knowledge you imputed to him.

The one to distrust is the person who never makes a mistake, never commits a blunder, never fails in what he tries to do. Either he is a phony, or he stays with the safe, the tried and the trivial.

Production is not the application of tools to materials, but logic to work.

To be a manager requires more than a title, a big office, and other outward symbols of rank. It requires competence and performance of a high order.

What the customer buys and considers value is never a product. It is always utility, that is, what a product or a service does for the customer.

The monomaniac is unlikely to succeed. Most leave only their bleached bones in the roadless desert. But the rest of us, with our multiple interests instead of a single mission, are certain to fail and have no impact at all.

Miracles are great, but they're so damn unpredictable.

You can either take action, or you can hang back and hope for a miracle. Miracles are great, but they are so unpredictable.

It is easier to raise the performance of one leader than it is to raise the performance of a whole mass.

The healthier a new venture and the faster it grows, the more financial feeding it requires.

The first step toward making the worker achieving is to make work productive.

Every few hundred years in Western history there occurs a sharp transformation. Within a few short decades, society -- its worldview, its basic values, its social and political structures, its art, its key institutions -- rearranges itself. We are currently living through such a time.

During periods of discontinuous, abrupt change, the essence of adaptation involves a keen sensitivity to what should be abandoned -- not what should be changed or introduced. A willingness to depart from the familiar has distinct survival value.

Growth that adds volume without improving productivity is fat. Growth that diminishes productivity is cancer.

There is no perfect strategic decision. One always has to pay a price. One always has to balance conflicting objectives, conflicting opinions, and conflicting priorities. The best strategic decision is only an approximation -- and a risk.

No decision has been made unless carrying it out in specific steps has become someone's work assignment and responsibility.

If something fails despite being carefully planned, carefully designed, and conscientiously executed, that failure often bespeaks underlying change and, with it, opportunity.

The first organization structure in the modern West was laid down in the canon law of the Catholic Church eight hundred years ago.

In business school classrooms they construct wonderful models of a non- world.

Unless the power of the corporation can be organized on an accepted principle of legitimacy, it will be taken over by a Central government.

The really important things are said over cocktails and are never done.

All earlier pluralist societies destroyed themselves because no one took care of the common good. They abounded in communities but could not sustain community, let alone create it.

And no matter how serious an environmental problem the automobile poses in today's big city, the horse was dirtier, smelled worse, killed and maimed more people, and congested the streets just as much.

Luck never built a business. Prosperity and growth come only to the business that systematically finds and exploits its potential.

Look at government programs for the past fifty years. Every single one -- except warfare -- achieved the exact opposite of its announced goal.

No matter how deeply wedded one may be to the free enterprise system (and I, for one, am wedded for life), one has to accept the need for positive government; one has to consider government action on a sizable scale as desirable rather than as a necessary evil.

A management decision is irresponsible if it risks disaster this year for the sake of a grandiose future.

Effective innovations start small. They are not grandiose. They try to do one specific thing.

Objectives can be compared to a compass bearing by which a ship navigates. A compass bearing is firm, but in actual navigation, a ship may veer off its course for many miles. Without a compass bearing, a ship would neither find its port nor be able to estimate the time required to get there.

Any time I have seen someone accomplishing something magnificent, they have been a monomaniac with a mission. A single-minded individual with a passion.

The talk you hear about adapting to change is not only stupid, it's dangerous. The only way you can manage change is to create it.

The fewer data needed, the better the information. And an overload of information, that is, anything much beyond what is truly needed, leads to information blackout. It does not enrich, but impoverishes.

There are just two questions to ask to attain success in business: First, What business am I in? Second, How's business?

To survive and succeed, every organization will have to turn itself into a change agent.

Meetings are by definition a concession to deficient organization. For one either meets or one works.

The 1st question the effective decision-maker asks is: 'Is this a generic situation or an exception?'

Decision making is the specific executive task.

Everything must degenerate into work if anything is to happen.

With Christianity, freedom and equality became the two basic concepts of Europe; they are themselves Europe.

One of the great movements in my lifetime among educated people is the need to commit themselves to action. Most people are not satisfied with giving money; we also feel we need to work.

Here I am, fifty-eight, and I still don't know what I'm going to be when I grow up.

The first rule of business is to survive and the guiding principle of business economics is not the maximisation of profit, it is the avoidance of loss.

If general perception changes from seeing the glass as 'half-full' to seeing it as 'half empty' there are major innovative opportunities.

Absolute size by itself is no indicator of success and achievement, let alone of managerial competence. Being the right size is.

Planning is actually incompatible with an entrepreneurial society and economy. Planning is the kiss of death of entrepreneurship.

Knowledge is being applied to knowledge itself. It is now fast becoming the one factor in production, sidelining both capital and labour.

The most important contribution management needs to make in the 21st century is ... to increase the productivity of knowledge work and the knowledge worker.

The most valuable assets of a 20th-century company were its production equipment. The most valuable assets of a 21st-century institution, whether business or nonbusiness, will be its knowledge, workers, and their productivity.

Management must take the lead in making obsolete its own products and services rather than waiting for a competitor to do so.

What is the major problem? It is fundamentally the confusion between effectiveness and efficiency that stands between doing the right things and doing things right. There is surely nothing quite so useless as doing with great efficiency what should not be done at all.

The person who will make the greatest contribution to a company is the mature person-and you cannot have maturity if you have no life or interest outside the job.

Managers are agents of transformation, converting the workforce in developed countries from one of manual workers to one of highly educated knowledge workers.

More business decisions occur over lunch and dinner than at any other time, yet no MBA courses are given on the subject.

Profit for a company is like oxygen for a person. If you don't have enough of it, you're out of the game. But if you think your life is about breathing, you're really missing something.

What's measured improves.

Not to innovate is the single largest reason for the decline of existing organizations. Not to know how to manage is the single largest reason for the failure of new ventures.

They wrongly believe that good intentions move mountains. Bulldozers move mountains. But there are exceptions.

Conductors do not know how the oboe does its work, but they know what the oboe should contribute.

The individual is the central, rarest, most precious capital resource of our society.

Adversarial power relationships only work if you never have to see or work with the bastards again.

The concept of profit maximization is, in fact, meaningless.

Value added is a meaningless concept for a retail business , for a bank, for a life insurance company, and for any other business which is not primarily engaged in manufacturing.

There are usually half a dozen right answers to what needs to be
done. Yet, unless a person makes the risky and controversial choice of only one, he will achieve nothing.

Far too much reorganization goes on all the time. Organizitis is like a spastic colon.

There's an enormous number of managers who have retired on the job.

A fundamental responsibility of leadership is make sure that everybody knows the mission, understands it, lives it.

There's nothing so useless than executing a task efficiently when it actually never should have been executed at all.

The single most important thing to remember about any enterprise is that there are no results inside its walls. The result of a business is a satisfied customer.

The basic economic resource -- the means of production -

is no longer capital, nor natural resources, nor labor.

It is and will be knowledge.

No society can function as a society, unless it gives the individual member social status and function, and unless the decisive social power is legitimate.

If socialism is defined as ownership of the means of production -- and this is both the orthodox and the only rigorous definition -- then the United States is the first truly Socialist country.

Cultivate a deep understanding of yourself -- not only what your strengths and weaknesses are but also how you learn, how you work with others, what your values are, and where you can make the greatest contribution. Because only when you operate from strengths can you achieve true excellence.

If a government commission had worked on the horse, you would have the first horse that could operate its knee joint in both directions. The trouble is it couldn't have stood up.

The better a man is the more mistakes will he make -- for the more new things he will try.

Successful leaders don't start out asking, 'What do I want to do?' They ask, 'What needs to be done?' Then they ask, 'Of those things that would make a difference, which are right for me?'

That the government's power under the Taft-Hartley Act to stop a strike by injunction so clearly strengthens the hand of the employer-even though it is used only when a strike threatens
the national health, welfare, or safety-is a grave blemish and explains much of union resistance to the Act.

Mother Teresa's numerical results were not her greatest contribution. Instead, she made the world -- and especially India -- conscious of compassion.

Teamwork is neither good nor desirable. It is a fact. Wherever people work together or play together they do so as a team. Which team to use for what purpose is a crucial, difficult and risky decision that is even harder to unmake. Managements have yet to learn how to make it.

The problem in my life and other people's lives is not the absence of knowing what to do but the absence of doing it.

The productivity of people requires continuous learning, as the Japanese have taught us. It requires adoption in the West of the specific Japanese Zen concept where one learns to do better what one already does well.

In the Western tradition, we have focused on teaching as a skill and forgotten what Socrates knew: teaching is a gift, learning is a skill.

Don't take on things you don't believe in and that you yourself are not good at. Learn to say no. Effective leaders match the objective needs of their company with the subjective competencies. As a result, they get an enormous amount of things done fast.

Successful people know they need to get many things done-and done effectively. Therefore, they concentrate their time and energy on doing one thing at a time-and on doing first things firs.

Management and union may be likened to that serpent of the fables who on one body had two heads that fighting each other with poisoned fangs, killed themselves.

The great challenge to management today is to make productive the tremendous new resource, the knowledge worker. This, rather than the productivity of the manual worker, is the key to economic growth and economic performance in today's society.

The three most charismatic leaders in this century inflicted more suffering on the human race than almost any trio in history: Hitler, Stalin, and Mao. What matters is not the leader's charisma. What matters is the leader's mission.

Until we can manage time, we can manage nothing else.

Capital formation is shifting from the entrepreneur who invests in the future to the pension trustee who invests in the past.

Tomorrow everybody -- or practically everybody -- will have had the education of the upper class of yesterday, and will expect equivalent opportunities. That is why we face the problem of making every kind of job meaningful and capable of satisfying every educated man.

What's absolutely unforgivable is the financial benefit top management people get for laying off people. There's no excuse for it. No justification. No explanation. This is morally and socially unforgivable, and we'll pay a very nasty price.

Too many leaders try to do a little bit of 25 things and get nothing done. They are very popular because they always say yes. But they get nothing done.

The subordinate's job is not to reform or reeducate the boss, not to make him conform to what the business schools or the management book say bosses should be like. It is to enable a particular boss to perform as a unique individual.

What you have to do and the way you have to do it is incredibly simple. Whether you are willing to do it is another matter.

The success and ultimately the survival of every business, large or small, depends in the last analysis on its ability to develop people. This ability is not measured by any of our conventional yardsticks of economic success; yet, is the final measurement.

For the first four years, no new enterprise produces profits. Even Mozart didn't start writing music until he was four.

Most Americans do not know what their strengths are. When you ask them, they look at you with a blank stare, or they respond in terms of subject knowledge, which is the wrong answer.

All economic activity is by definition high risk. And defending yesterday -- that is, not innovating -- is far more risky than making tomorrow.

Use feedback analysis to identify your strengths. Then go to work on improving your strengths. Identify and eliminate bad habits that hinder the full development of your strengths. Figure out what you should do and do it. Finally, decide what you should not do.

Executives do many things in addition to making decisions. But only executives make decisions. The first managerial skill is, therefore, the making of effective decisions.

Nobody in the world is as good at making decisions as the Japanese.