The Effective Executive: Mastering Productivity

Effective Executives are rare

• An Executive's job is to get the right things done

• Insight is not in itself achievement

  • Insights become effectiveness only through systematic work

• Plodding is a very effective strategy

  • Just put one foot in front of the other, everyday

• Manual work only requires doing things right; knowledge work requires doing the right things

  • Factories and assembly lines have come a long way in the last 100 years

• Manual workers used to be the huge majority in organizations

• The knowledge worker can't be supervised in detail; only helped. He must direct himself

  • A big part of your job is just thinking

• The motivation of the knowledge worker depends on his being effective, on his being able to achieve

  • This is backed up by studies

• If effectiveness is lacking in his work, he will go through the motions from 9 to 5

• The greatest wisdom not applied to action and behavior is meaningless data

Who is an executive?

• Every knowledge worker is an executive

  • If you make decisions, you're an executive

  • Think of yourself as an executive in other areas of life too

• This is different than managing people

  • Some managerial roles are "overseers", without responsibility or authority to affect the work itself

• Knowledge work is defined by results, not quantity or costs

  • 10x engineers

• Effectiveness as a skill is useful in all jobs - junior IC or company president

  • Developing effectiveness gives you infinite job security

• This book is for everyone who makes decisions and takes actions meant to contribute to performance of an organization

Executive Headwinds

• Effectiveness is required but difficult to achieve within an organization

• 4 realities which you have no control over exerting pressure towards nonperformance

  • 1 Your time is available to others in your organization

  • 2 Executives must continue to operate unless they deliberately step outside the flow of events

    • The flow of events is usually more noise than signal at the executive level - it becomes difficult to determine which events are important vs distractions without stepping out

  • 3 organizations themselves are only effective if others make use of the executive's contributions

    • Organization is a means of multiplying the strength of an individual

  • 4 executives are inside an org, and everything within is close and immediately reality

    • He is less exposed to the outside, but all results are on the outside - customers

    • Customers convert the cost and effort of people within the organization into revenue and profit

    • What happens inside is cost and effort - profit centers are a euphemism for effort centers

Problems of scale of technology

• That is takes 100k people to make a car or steel the market wants is a gross engineering imperfection

  • The fewer people, the smaller, the less activity inside, the more nearly perfect is the organization

  • AI replacing skilled labor is a boon for this

• Organizations grow in size the same way biological organisms do: mass grows faster than surface area

  • The larger it gets, the more resources have to be devoted to internal functions

  • whale vs. bees

• Computers exacerbate problems of disconnect

  • They are only good with quantifiable data, and many important aspects of reality are not quantified

  • The most accessible things to quantify are within an organization, not outside

  • Ford Edsel as an example - it was the quantifiably perfect car, but consumer purchasing shifted from income-based to taste-based, which was an unpredictable qualitative change

• The important events on the outside are not trends, but changes in trends. These have to be perceived

  • Computers are logical, which is both a strength and a limitation. Humans are perceptive

  • If humans become overly dependent on computers, they shut out access to reality via outside perception

Can Effectiveness be Learned?

• If one cannot increase the supply of a resource, one must increase its yield (by becoming more effective)

• If it can be learned, how? What do you learn? How do you learn it?

  • Habits and practices - not natural gifts or personality traits

  • There is no reason why a normally endowed person should not be able to become effective and competent through practice

• 5 habits/practices of the mind that must be acquired

  • Know your time, and manage it ruthlessly

  • Focus on outward contribution - gear efforts towards results instead of work itself

  • Build on strengths: their own strengths as well as others within their organization. Do not build on weakness or start with things you can't do

  • Concentrate on the few major areas where superior performance leads to outstanding results. Prioritize and do first things first

  • Make effective decisions

    • Most importantly, what are the right steps in the right sequence

    • To make many decisions quickly is to make the wrong decisions

    • Far better to make few, fundamental decisions

Track Your Time

• Do not start with planning, start with measuring what you're already doing

• 3 steps

  • Record

  • Manage

  • Consolidate

• Time is the limiting factor - the output limits of any process are set by the scarcest resource

  • H2O example

  • Time is inelastic - no matter the demand for your time, you can't make more of it

  • Time cannot be stored. Yesterday is gone forever

  • Time cannot be substituted

The Time Demands on the Executive

• Top-level executives have obligations that are time-wasters

  • CEO of a large company had done out to dinner every day for 2 years except Christmas and New Years, meeting important clients, government officials, etc.

  • None of these contributed to his own productivity, entertainment, or self-development, but he had to be there

• Most important tasks require a fairly large chunk of uninterrupted time, and spending less than that is a waste

  • Making courses as example

  • Athletics as example

  • It's a fallacy to think that one 4-hour chunk is the same as 8 30-min chunks

  • Spending time with people is especially important - 15 mins at a time is not enough to make an impact, shoot for an hour to allow time to load context and sink your teeth into the topic

• The more people who have to work directly together, the more time goes to interaction overhead

  • The ideal I try to strive for is having individuals who can work in almost complete autonomy, with well-defined inputs/outputs

  • In general, the more people, the more overhead/decisions - Berkshire Hathaway example

  • At a certain point, you need dedicated managers just for people, which is a position of overhead

• Time demands are shifting from manual to knowledge workers

  • The easier the manual work is, the more thought goes into making it easy - automation

• All one can think and do in a short time is to think what one already knows and do what one has always done

Time Diagnosis

• Most people are terrible at estimating how they spend their time from memory

  • How long did you study for a test in college?

• If you're in a spot where someone else can measure your time for you, have them do it - they will be more objective than you will. If you can't, record it in real time and be brutally honest

• Drucker recommends measuring 4-week stretches at least twice per year

  • Time will naturally drift into unproductive areas

  • Time use improves with practice, but never to the point where it doesn't need to be actively monitored

• After you have a record of your time, the next step is managing it:

  1. Identify and eliminate things that don't need to be done at all - "What would happen if this were not done at all?" - if the answer is "nothing", stop doing it

     1. The CEO from the previous example found that 1/3 of his dinners would be fine without him there, and many more he was not actually expected to attend by the host; they'd invited him out of politeness

  2. Which of the activities on my log could be done just as well, or ideally even better, by someone else?

     1. Another 1/3 of the dinners he could replace himself with another senior exec

     2. Work travel is a great example - younger people value work travel more and are better equipped to handle the fatigues

     3. Delegation should only come after elimination

  3. Don't waste others' time - ask "What do I do that wastes your time without contributing to your effectiveness?" - don't be afraid of the truth

     1. Written summaries of meetings are a good way to prevent people from feeling left out

     2. Over-pruning feels scary, but is a very easy problem to fix. Better to overprune than under-prune

Pruning Time-wasters

• Identify waste that comes from lack of system or foresight

  • The symptom is recurring crisis. A crisis that happens more than once needs to be root-caused and eliminated

  • A routine makes unskilled people without judgement capable of doing what took near-genius before

  • Recurring crises are a symptom of laziness

  • A well-managed organization is very quiet, even boring, because crises have been anticipated and turned into routine

• Time waste often comes from overstaffing

  • If it takes two ditch-diggers two days to dig a ditch, how long would it take 4 ditch-diggers?

    • In first grade, the answer is one day

    • In knowledge work, the right answer is probably 4 days if not forever

  • The larger the org, the more of everyone's time gets sucked into interacting and overhead instead of productive work

  • In general your staff should only include people who are needed everyday. Specialists/consultants should remain outside the org, to be brought in as-needed for well-defined scopes of work

• Excessive meetings

  • Meetings are by definition a concession to deficient organization. One either meets or works

  • Meetings also spawn more meetings - they can snowball

  • Ideally an organization would have 0 meetings - everyone would know and be able to execute on their work and have it seamlessly interconnect with others' work. This is impractical with people, but with automation it becomes possible

  • An organization in which everyone meets all the time is an organization in which no one gets anything done

    • A reasonable goal to shoot for is <10% of your time in meetings for knowledge workers.

  • A notable exception is when your job requires meetings to be effective, like in sales

    • If you're not in sales and your job is mostly meetings, watch out - you're in an overhead role

• Malfunction of information

  • Example of empty hospital beds - report was sent at 5am but patients weren't discharged until 8am

  • Info that needs "translation" - it is in the wrong form

    • For example, a spreadsheet calculates the average but what is actually useful is the median

• Correcting these 4 things may be quick or may take months, but the time gains are great and worth it

Consolidating Discretionary Time

• No matter how ruthlessly you prune, you shouldn't expect to get a huge amount of discretionary time back

  • Currently shooting for 3-4 hours per day, which is sustainable/optimal - Peak

• Do not disturb is crucial

  • Stuff can wait 4 hours

• Working from home at least 1 day/week can create this space

• Consolidating operating meetings into certain days of the week works well too

• If you can't effectively manage your own time, you can't effectively manage anything else. Time is the scarcest resource - think of it like air

What can I contribute?

• Focus on responsibility and results, not status and effort

  • He who focuses on efforts and downward authority is a subordinate no matter his title and rank

  • He who focuses on contribution and results, no matter how junior, is by literal definition "top management" - he is accountable for the performance of the whole

The Executive's Own Commitment

• The test is not whether you personally like your outputs, it's how effective your outputs are

• To ask, "What can I contribute?" is to look for unused potential, aka opportunity

  • Failing to ask this leads to aiming to low, or at the wrong things

Every organization needs performance in three major areas

• Direct results

• Building and reaffirmation of values

• Building and developing people for tomorrow

• Neglecting any of these leads to organizational decay

  • All 3 must be built into the performance of every executive; how much of each will depend on specifics like personality, position, and organizational needs

• Direct results are easily visible - profits of a business, people affected by a charity or nonprofit

  • These are to business what calories are to nutrition

  • When there is confusion about what results are expected, there is no effectiveness

• Value commitments and reaffirmations and vitamins and minerals

  • Without them, there is disorganization, confusion, and paralysis

People adjust to the level of demands made of themselves

• The executive who focuses on contribution raises the standards of everyone he works with

  • Nurse Bryan asked a hospital, "Are we doing the best we can to help this patient?"

  • The rising tide lifts all ships

• The most common cause of failure is inability or unwillingness to adapt and change

  • What worked in an old role doesn't necessarily translate to the new one

  • The Peter Principle

How to Make the Specialist Effective

• Knowledge workers only become effective when they've learned to do one thing very well

  • By itself, that thing does not have value - it must be combined with other specialists to produce results

  • The task is not to be a generalist - it is to make the specialized output effective for its consumers

• The man of knowledge has the responsibility of being understood

  • "It is barbarian arrogance to assume the layman can or should make the effort to understand him"

  • This attitude condemns the expert to uselessness and pedantry

• Ask others in your org

  • "What do you need from me in order to be effective in your own contribution? When, how, in what form?"

  • Accounting average vs. median example

• The only meaningful definition of a generalist is someone who can relate his own small area of expertise to the universe of knowledge

  • Having knowledge in multiple areas doesn't make you a generalist, it makes you a specialist in multiple areas

The Right Human Relations

• Mutually productive relationships are the only valid organizational definition of "good HR"

  • Warm feelings and pleasantries are meaningless in what is fundamentally a work- and task- focused relationship

• Focus on contribution supplies the 4 essentials of good HR

  • Communication, teamwork, self-development, development of others

• The usual focus is on top-down communication, but that is ineffective

  • A focus on contribution lays the foundation for effective communication:

    • "What contributions should the organization hold you accountable for?"

    • "What should we expect of you?"

    • "What is the best utilization of your knowledge and ability?"

• In knowledge work, people must work together voluntarily and in accordance with the demands of the task, not according to a rigid jurisdictional structure

  • Ideal is the be spontaneously self-organizing

• Effective communication is distinct from automated information handling

Spontaneous Self-Organization

• In knowledge work, people must work together voluntarily and in accordance with the demands of the task, not according to a rigid jurisdictional structure

Effective communication is distinct from automated information handling

Self-development stems from focus on contribution

• What is the most important contribution I can make to the performance of the organization?

• What knowledge and skills do I have to acquire to make the contribution I should be making?

• What strengths do I have to put to work?

• What standards do I set for myself?

The Effective Meeting

• Why are we having this meeting?

  • To make a decision?

  • To inform?

  • The purpose must be established before the meeting is called

  • Always summarize the original intent and conclusions at the end of meetings

• Focus on contribution enables executives to identify signal from noise, and imposes an organizing principle

One cannot build on weaknesses

• one must build on individuals' strengths - that is where the opportunity lies

• It cannot overcome weakness, but it can make weakness irrelevant

Make staffing decisions to maximize strength

• Expertise is forged through experience

  • Where there are peaks, there are valleys

  • Don't judge fish by their ability to climb trees

Avoiding weakness leads to mediocrity

• Hiring "well-rounded" people is a recipe for mediocrity and incompetence

Excellence can only be achieved in one area, or at most a few

• Your personal area of excellence should mesh with your personality

  • "The man who enjoys walking walks farther than the man who enjoys the destination"

• Demands should be aligned with areas of excellence

An organization should be strong in all the areas it needs to be

• One person's strength can cover another's weakness

The conflict with building on individual strengths is the objectivity of jobs

• Jobs must be objective - if you need a biology teacher, you have to pass on the transcendent calculus teacher even if you're aware of the strength

  • There are exceptions where you can fit the job to the man

• This feels dated - many modern jobs require little more than an internet connection and a laptop, and the internet has enabled more creative ways to pursue opportunities

One should not staffed based on personality, but on strength

• This prevents nepotism and politicking to a degree and keeps the focus on "what" is right rather than "who" is right

• Alignment is ideal, but if the ideal is unavailable, this is the pecking order

• Drucker recommends not immediately working with friends so as to keep distinct relationship boundaries

  • Exceptions should only be made for people who have proven "exceptional capacity to do the unusual with excellence"

Jobs must be realistic

• Many job descriptions are impossible, despite looking logical on paper

• The origin of these jobs is usually to fit a uniquely suited individual, specifically their temperament

  • Managing many clients well as a rep

  • Jobs must be redesigned to be realistic if they fit this

Make jobs demanding and big

• Performance is only possible in real work - in school one can only show promise

• Small jobs can be automated or outsourced

• Throughout a job, and organization can learn the individuals' true strengths and reallocate better

Strengths don't necessarily transfer between organizations

• Workers need to figure out during the job if they are in the right place to maximize their strengths

  • This can't be adequately done if the job is too small

Start with what someone can do

• This means you need to anticipate what people can do in the future

• Traditional appraisals are bad because they focus on weaknesses

  • Focusing on weaknesses undermines the relationship

  • Japanese business exclusively focuses on strengths

• Potential should not be judged much beyond what someone is already doing - even if potential is there, it may be unfulfilled

All one can measure is performance. All one should measure is performance.

• An effective appraisal form is a record of expected results against actual results

• Then asks 4 questions:

  • What have they done well?

  • What, as a consequence, are they likely able to do well?

  • What do they need to learn or acquire to get the full benefit from their strength?

  • If I had a son or daughter, would I willing to have them work under this person? Why or why not?

    • This is the only one aimed at unearthing weakness - people tend to mold themselves after forceful bosses, and nothing is more destructive than a forceful but corrupt boss. This is a dealbreaker.

• By themselves, character and integrity do not accomplish anything.

To get Strength, one must put up with weakness

• Does someone have strength in one major area?

  • And is this strength relevant?

  • If they achieve excellence in this one area, will it make a significant difference?

• Executives rarely suffer from the delusion that two mediocrities achieve as much as one good man.

  • Two mediocrities generally achieve less than one mediocrity because they get in each others' way

Staff for opportunities, and put the best person on the job

• This creates effectiveness, enthusiasm, and dedication

It is the duty of the executive to remove ruthlessly anyone, especially managers, who consistently fails to perform with high distinction

• To let such a person stay corrupts others

• Removing someone is less the fault of the person being removed, and more the fault of the person who appointed them

  • The person being removed may excel in a role better suited for them

Weaknesses are mainly relevant when they impede development of strength

• There are a lot of "glue qualities" that are necessary across the board - basic people skills

• Every people decision is a gamble. Basing it on strengths makes it a rational gamble.

• There are more opportunities than ever before for knowledge work with the internet, but it creates a paradox of choice

How Do I Manage My Boss

• Make the strengths of the boss productive

• People are either readers or listeners

  • Sending lots of writing to a listener is less effective than talking, and vice versa

• Having synergies with your boss can lead to rapid advancement for both

  • This comes about by a mutual commitment to maximizing strengths

Making Yourself Effective

• Effective Executives lead from the strength of their own work

• Most people are preoccupied with what their job won't let them do

  • Strength is wasted complaining

• Better to just go ahead and do

  • "you see what you look for" - look for things to do

  • "Whether you think you can or you think you can't, you're right" -Ford

Making strengths effective is very personal

• Do you work better at certain things in the morning, or night?

Introverted/extroverted?

• Interact with other people or work alone

Temperament?

Sleep?

• 8.5 hours of sleep

Focus work, exercise, eat, distractable work, eat, chill out

• Think of scheduling like an athlete

"Minor" habits are a huge source of effectiveness - compounding interest

"What are the things that I can do with relative ease that come hard to others?"

Making strength productive is as much an attitude as a practice

The standard of any human group is set by the performance of the leaders

• It is easier to raise the performance of one leader than a mass

• The purpose is not to change human beings, it is to find 1+1=3 synergies of strength

If there's a "secret" to effectiveness, it is concentration

• Concentration is the courage to impose your own decision on time and events

• First things first, one thing at a time

• There are always more impactful contributions to be made than time to do them

• Concentration is focusing all your faculties on one achievement

• An exception is having two main tasks and alternating to give a change-of-pace

  • Minimum amount of time must be given to each to be effective

  • Having more than two major things at a time is unreasonable

Expect the Unexpected

• Focus on one thing until it's done

• Don't assume everything will go right or happen in a timely fashion

• Do not hurry - set a sustainable pace and keep putting one foot in front of the other

Slough off Yesterday

• The First Rule is to slough off what has ceased to be productive

• "If we did not already do this, would we start doing it now?"

  • If it's not an unconditional "yes", stop or heavily curtail the activity

• Cleaning up the past takes a lot of time

  • Total failures take care of themselves - yesterday's successes are harder to clean up once they cease being productive

  • Activities which should work but aren't are the most dangerous - "investments in managerial ego"

  • This two are especially prevalent in gov't where things go out of date but continue to operate

    • FDR's New Deal

    • Drucker recommends having each new government act/agency/program automatically expire to prevent this

In order to start a new large activity, you must stop doing an old one

• Do not hire new people for new tasks

  • Put people of proven strength on new tasks

  • Put new people on established and smoothly running tasks to expand

Setting priorities is as much about courage as intelligence

• Pick the future over the past

• Opportunities instead of problems

• Your direction instead of the bandwagon direction

• Aim high for something that will make a difference instead of something "safe"

• All of these require the courage to go against the crowd

The effective executive does not commit himself beyond the one task being concentrated on.

• Afterwards, you must re-evaluate and re-prioritize

Decision-making is the Executive's main task

• Do not make many decisions - concentrate on the important ones

• Make decisions at the highest level of conceptual understanding

  • "have the longest view in the room"

  • Complexity is a product of sloppy thinking

  • This makes most operational decisions not decisions but implementations of the larger decision

Impact over technique, substance over style

• Speed is unimpressive

• Effective executives know when to decide based on principle vs. pragmatically

  • Iatrogenics

• The trickiest decision is between the right and the wrong compromise

• The most time consuming aspect of a decision is putting it into effect

  • Until it becomes someone's work, it is at best a good intention

• The action of carrying out a decision should be done at the lowest level possible

  • Decision makers + VAs/automation

Centralize or Decentralize?

• Business needs unity of direction and central control

• Business also need enthusiasm and empowerment of manager in operations to do things their way

• Solution is localized operational autonomy with centralized direction

  • McDonalds franchises changing logo - each store is run separately, logo applies to all

• "Organized self-obsolescence" is how to evolve within a company

Decisions will be controversial

• Decisions should be strategic instead of reactive

• One aspect of executing on buy-low, sell-high is that you go against the crowd

  • Opportunities are inherently undervalued

Elements of decision making process

• Is the problem generic?

  • if so it must be solved by a rule or principle

  • If not you have more options - easiest/cheapest/etc.

• What criteria must the solution satisfy? What are the boundary conditions?

• Think through the solution that will fully satisfying the requirements before giving any attention to compromises, adaptations or concessions needed

  • It's not worth getting in the weeds on stuff that won't work at the highest level

• Building into the decision the action to carry it out

• What metrics do you need to evaluate if the decision was effective against the real course of events?

Is the situation generic or an exception?

• Almost all are generic at some level, even outside your company

• One cannot make rules for the exceptional

• Classifying the situation incorrectly means making the wrong decision

• By far the most common mistake is behaving pragmatically without understanding principle

• Assume that the alarm is a symptom and look for the true problem

The longevity of the temporary

• FDR new deal

• "if I had to live with this for a long time, would I be willing?"

Specify what the decision must accomplish

• What are the objectives it must reach?

• What is the minimum acceptable outcome?

• What conditions does it have to satisfy?

• The more concisely and clearly these conditions are stated, the greater the likelihood the decision will be effective

• One cannot get anything but trouble from a decision that doesn't meet specifications

• The most dangerous decision is the one that might work if nothing goes wrong

  • The trouble with miracles is not that they happen rarely, it is that one cannot rely on them

• A decision that must satisfy incompatible boundary conditions is not a decision but a prayer for a miracle

The right compromises

• Do not start with "what is acceptable" or worse "who is right"

• If you don't know what is right to satisfy the boundary conditions, you can't make the right compromises

  • "half a loaf of bread is better than no bread, half a baby is worse than no baby"

  • The first still satisfies the boundary condition, the second doesn't

Convert the decision into action

• This is the most time-consuming part

• No decision has truly been made until carrying it out in specific steps has become someone's work assignment

  • Who has to know of this decision?

  • What action has to be taken?

  • Who is to take it?

  • What action must be taken so that the people who have to do it can do it?

  • The action must be appropriate to the capabilities of the people who must carry it out

    • VA's and automation

Changing behavior, habits, attitudes

• Metrics and incentives must change, otherwise people get stuck in a paralyzing internal emotional conflict

• You must not reward behavior contrary to executing the decision

  • Walk the walk

Measuring the decision

• Feedback/metrics must be built into the decision for evaluation against actual events

• Even the best decisions have a high probability of being wrong

• Even the best decisions eventually become obsolete

• "To go oneself and look is the only reliable feedback."

  • This is repeated globally throughout history in military text, from Greece to Rome to China

  • Be distrustful of communications, not people

  • Test whether the assumptions on which the decision was made are still valid. They will eventually be obsolete, reality doesn't stand still for very long

  • It may be appropriate to abandon a decision if boundary conditions change such that the original purpose can no longer be attained

All computers handle are abstractions, which need to be routinely measured against the concrete. If not they will mislead us

• Unless you go out and get direct exposure to reality, you condemn yourself to sterile dogmatism

Effective Decisions

• Decisions are judgments - choices between imperfect alternatives

  • Rarely a choice between right and wrong

• Start with facts is bad advice - you must start with opinions

  • Treat opinions as untested hypotheses - worthless until tested against reality

  • To determine a fact requires a decision on the criteria of relevance and measurement, which is rooted in opinion

• Facts are not universal

  • In physics, taste is not a fact. In cooking, it is.

  • Starting with facts will lead people to find facts that support their existing opinions

    • No one ever fails to find these facts

As in science, the starting point is untested hypotheses - opinions

• What do we have to know to test the validity of this hypothesis?

• What would the facts have to be to make this opinion tenable?

• Defining the criteria of relevance leads to appropriate metrics

  • Assume that the traditional measurement is the wrong measurement - otherwise there would be no need for a decision, only an adjustment

  • E.g. Averages are a fine metric for insurance, but bad for personnel decisions

  • This is not just a math exercise. It is a risk-taking judgment

  • Come up with alternatives so you are choosing the best one and not just a 'yes' or 'no'

• Unless one has considered alternatives, one has a closed mind

One does not make decisions unless there is disagreement

• Clash of opposing views creates alternatives and pros/cons to consider

• Susses out biases - everyone favors their own decision, even if well-intentioned

• Disagreement stimulates the imagination - correctly framing the decision usually leads to an obvious solution

  • 6x4 = 4x6, but a blind Venetian is different than a Venetian blind

  • Making this metaphorical mistake is very common without stimulation

• From here, find out why people disagree - understanding is the first step

  • This is uncommon - most people start out with the assumption they are right and argue their own position

  • Others' opinions and rationales become a source of information for you

Doing nothing

• Doing nothing is always an alternative you should consider

• Decisions can have iatrogenic effects

  • Sometimes the cure is worse than the disease

  • One does not make unnecessary decisions like a surgeon does not do unnecessary surgeries

• One must make a decision if a situation will degenerate if you do nothing

  • Win the war, not individual battles

• One must make a decision if an opportunity is important and short-lived

• If you ask "what will happen if we do nothing" and answer "it will take care of itself", one does not interfere

  • Nor does one interfere if the condition is annoying but ultimately unimportant - let small fires burn

  • This understanding is exceptionally rare

Most decisions are in the middle

• The problems won't solve themselves or degenerate malignantly

• Most are opportunities that come with opportunity costs

Don't half-ass it

• Act if on balance the benefits greatly outweigh cost and risk

• Act or do not act, but do not half-ass it - that's the worst thing you can do

  • Do surgery or don't, but don't remove one tonsil

The Final Decision

• After going through previous steps, the decision is usually obvious

• Once the decision "makes itself", it usually falls apart

  • The decision won't be pleasant, popular, or easy

  • If the right thing to do was easy, you woudn't be here thinking about it

  • Medicine doesn't inherently have to taste bad, but the most effective ones usually do

• At this point you must resist looking for circling back and looking for other alternatives because you find the solution distasteful

  • That is the coward's way, unless there is meaningful new information to be considered. Usually there isn't.

• Do not rush into a decision until you understand it

  • "Stop when things seem out of focus"

• Executives are not paid for doing things they like to do - they are paid for getting the right things done

Decision making with computers

• Computers do not get bored, tired, or go on vacation

• A computer's strength is in logic, not perception

  • Appropriate tasks for computers must be rigidly logical

  • Trying to meaningfully model perceptual data in a computer is a waste of time

  • People know information and tendencies about other people, and can use this to adapt and troubleshoot minor problems in a way that computers can't

• Computers don't take risks or evaluate abstract alternatives under uncertainty

  • Trying to have computers do this is dystopian - think the Matrix with Neuralink

  • Computers can't make good decisions without the right data, which must be decided by humans

  • Allude to Nassim Taleb courses

• Individuals within an organization who use computers become knowledge workers, aka executives

• An appropriate use of computers is to automate operations within an organization

  • This frees up the executive to look outside the organization for opportunities

Effectiveness must be learned

• This book/course has given you resources and tools to learn effectiveness

• Effectiveness can be learned but not taught - it is a self-discipline

  • It is crucial to individual self-development

• Steps:

  • Recording time

  • Focus on contribution

  • Make strength productive

  • Prioritize

  • Decide

Effectiveness is Desirable

• Being able to affect things important to you is a valuable skill to have

• The advancement of society depends upon organizational effectiveness

• Organizations are not just business

  • Charities, churches, etc.

• The knowledge working is the primary resource in the modern economy

  • Ineffectiveness is the rule

• Self-development is the only way to align and satisfy both personal and organizational goals