Management Challenges
for the 21st Century
P.F. Drucker
Management’s New Paradigm
• Since 1930’s
Management is Business Management
• Today
Mgmt. is the Specific Distinguishing Organ of
Any and All Organizations
Mgmt.’s New Paradigm
• Since 1930’s
One Right Organization Structure
• Today
No Such Thing… … People Variables
The Organization that Fits the Task
Mgmt.’s New Paradigm
• Since 1930’s
One Right Way to Manage People
• Today
Different People have to be Managed Differently
– People are Lead… To make most productive their
specific strengths.
Strategy – the New Certainties
1. The Collapsing Birthrate in the Developed
World
•
Politics of Turbulence
•
Government Instability
•
Retirement
•
Productivity Must Increase Rapidly
Strategy – the New Certainties
2. The Distribution of Disposable Income
•
4 Growth Sectors of the 20th Century
1. Government
2. Health Care
3. Education
4. Leisure
•
Growth of Financial Services
Strategy – the New Certainties
3. Defining Performance
•
Institutional Ownership
•
“For Whose Benefit Should the Business be Run?”
•
Stakeholders
•
Short Term vs. Long Term
Strategy – the New Certainties
4. Global Competitiveness
•
Cheap Labor No Longer Works
•
Growing Global Standards
•
“Protection” No Longer Protects
–
Tariffs, Taxes, etc…
Strategy – the New Certainties
5. Growing Incongruence between Economic
Reality and Political Reality
Global Economy of Money & Information
vs.
Regional, National, and Local Realities
The Change Leader
• Sees Change as an Opportunity
– Abandonment
– Organized Improvement (3%)
– Exploiting Success
“Make the Future”
The Information Revolution
• From the “T” to the “I”
• Continuing Education
• Organizing Information
– Key Events or KPI’s
– Statistics
– Threshold Phenomenon
Knowledge-Worker & Productivity
• What is Your Task?
• What Should it Be?
• What Should You be Expected to Contribute?
• What Hampers You in Doing Your Task?
• What Should be Eliminated?
Managing Oneself
• Who Am I?
• What are My Strengths?
• How do I Work?
• Where do I Belong?
• What is My Contribution?
• Take Responsibility!
• Plan for the Second Half of Your Life!
Why Acquire?
• To Grow!
–Because Organisms Grow or Die
Why Acquire?
• To Own Strategic Assets
– Key Resources
– Patents/Technology
– Geography
– Eliminate Competition
Why Acquire?
• To Diversify / Reduce Risk
– Management Objectives
– Shareholder Value
• Only 20-30% of Acquisitions  shareholder value
Which Way to Grow?
GF/OM
Horizontal
HNZ/Hubinger
Grow Cash
Grow Earnings
Grow Both
How to Defend Against Others?
• Do Well and Insure Full Value!
• Use Legal Options, Poison Pills
– Thru: Government Options
• HSR
• A/O
– Who Owns Your Stock
– Management Buyouts
At What Price?
• To Shareholders
– Dilution Limits
– E.V.A.
• I.R.R.
• Whatever it Takes