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The healthier a new venture and the faster it grows, the more financial feeding it requires.
The business has outgrown being managed by one person, or even two people, and it now needs a management team at the top.
the people who founded the business and built it almost always end up on the outside, embittered and disenchanted.
The remedy is simple: to build a top management team before the venture reaches the point where it must have one.
It is prudent to establish the top management team informally at first.
Long before it has reached the point where it needs the balance of a top management team, the new venture has to create one.
the typical board of directors very often does not provide the advice and counsel the founder needs. But the founder does need people with whom he can discuss basic decisions and to whom he listens. Such people are rarely to be found within the enterprise.
Freedom without law is license, which soon degenerates into anarchy, and shortly thereafter into tyranny.
The creative imitator does not invent a product or service; he perfects and positions
Creative imitation starts out with markets rather than with products, and with customers rather than with producers.
this risk, the risk of being too clever, is inherent in the creative imitation strategy.
high-tech innovators are least likely to be market-focused, and most likely to be technology and product-focused.
If the criminal is caught, he rarely accepts that his habit has betrayed him. On the contrary, he will find all kinds of excuses—and continue the habitual behavior that led to his being captured. Similarly, businesses that are being betrayed by their habits will not admit it and will find all kinds of excuses.
“Quality” in a product or service is not what the supplier puts in. It is what the customer gets out and is willing to pay for.
Customers pay only for what is of use to them and gives them value. Nothing else constitutes “quality.”
A “premium” price is always an invitation to the competitor.
The toll-gate position is thus in many ways the most desirable position a company can occupy.
All the strategies discussed in this section have one thing in common. They create a customer—and that is the ultimate purpose of a business,
Most suppliers, including public-service institutions, never think of pricing as a strategy. Yet pricing enables the customer to pay for what he buys—a shave, a copy of a document—rather than for what the supplier makes.
there are no “irrational customers.” As an old saying has it, There are only lazy manufacturers.
Every economics book points out that customers do not buy a “product,” but what the product does for them.
the knowledge worker is, first of all, expected to get the right things done. And this means simply that the knowledge worker is expected to be effective.
insights become effectiveness only through hard systematic work.
Intelligence, imagination, and knowledge are essential resources, but only effectiveness converts them into results.
There are few things less pleasing to the Lord, and less productive, than an engineering department that rapidly turns out beautiful blueprints for the wrong product.
Knowledge workers cannot be supervised closely or in detail. They can only be helped.
One can indeed never be sure what the knowledge worker thinks—and yet thinking is his or her specific work; it is the knowledge worker’s “doing.”
Knowledge work is not defined by quantity. Neither is knowledge work defined by its costs. Knowledge work is defined by its results.
For the authority of knowledge is surely as legitimate as the authority of position.
If the executive lets the flow of events determine what he does, what he works on, and what he takes seriously, he will fritter himself away “operating.”
The truly important events on the outside are not the trends. They are changes in the trends.
The computer only makes visible a condition that existed before it.
Effectiveness, in other words, is a habit; that is, a complex of practices. And practices can always be learned.
Effectiveness does not come naturally. Like leadership, it must be learned.
There is, in other words, no reason why anyone with normal endowment should not acquire competence in any practice.
The focus on contribution is the key to effectiveness: in one’s own work (its content, its level, its standards, and its impacts) in one’s relations with others (with superiors, associates, subordinates), and in the use of the tools of the executive such as meetings or reports.
the man who focuses on contribution and who takes responsibility for results, no matter how junior, is in the most literal sense of the phrase, “top management.”
The publications immediately took on a highly professional look. But the scientific community for whom these publications were intended stopped reading them. A highly respected university scientist, who had for many years worked closely with the agency, finally told the administrator, “The former director was writing for us; your new man writes at us.”
For us is much better than at us.
To ask, “What can I contribute?” is to look for the unused potential in the job.
There has to be something “this organization stands for,” or else it degenerates into disorganization, confusion, and paralysis.
organization is, to a large extent, a means of overcoming the limitations mortality sets to what any one person can contribute.
The most common cause of failure is inability or unwillingness to change with the demands of a new position. The knowledge worker who keeps on doing what he has done successfully before he moved is almost bound to fail.
Knowledge workers do not produce a “thing.” They produce ideas, information, concepts.
communications are practically impossible if they are based on the downward relationship.
people in general, and knowledge workers in particular, grow according to the demands they make on themselves.
Knowledge workers are likely to outlive their employing organization.
workers, and especially knowledge workers, will outlive any one employer, and will have to be prepared for more than one job, more than one assignment, more than one career.
people—often do not understand that manners are the “lubricating oil” of an organization.
few people know how they get things done. Most of us do not even know that different people work and perform differently.
The first thing to know about how one performs is whether one is a reader or a listener.
do not try to change yourself—it is unlikely to be successful. But work, and hard, to improve the way you perform.
