High Output Management

by Andy Grove

Notes on one of the most-recommended old-school management books for tech startups.


The output of a manager is the output of the organizational units under his supervision or influence.

What is that output? How is it measured? 

Effectiveness

Managerial Leverage
Do high leverage activities, those where your investment of time contributes most to increase output. Forget the rest. You also can have negative leverage, when you de-motivate your employees by badmouthing the company, when you do not provide them with clear direction, or when you do not make a decision. No green light is a red light, and can freeze the organization. Meddling has negative leverage, when you involve yourself too deeply in your subordinate's work, taking their ownership away (even if you are better at it than they are).

Take control of your time
The most important resource you allocate for leverage is your own time. Capital and manpower can be obtained. More personal time can not. Your calendar is your most important management tool. Actively manage it. Fill holes between time critical events with non-time critical but necessary activities. Do not allow others to throw in orders for your time. This is mindless passivity, defense, not offense. Say NO at the outset to work beyond your capacity to handle. Allow slack, a bit of looseness in your scheduling (like 3/4 h meetings instead of 1h meetings end to end). Maintain a backlog of projects that you can take on, and at any time only focus on a few active ones -- best one. Strive towards regularity, routine -- meetings always on the same day etc. (This only works if others do so too).

Delegation
Avoid the charade of insincere delegation, which has massive negative leverage. Delegation without follow-through is abdication. You can never wash your hands of a task. After you delegate it, you are still responsible for accomplishment, and monitoring is the only practical way to ensure a result.  Adapt your monitoring to the amount of experience the subordinate has with the task, less if they are very task-mature, more if they are new to it. Only go into details randomly, and just enough to ensure the subordinate is moving ahead satisfactorily. A manager should have six to eight subordinates, so he can allocate about half a day to each.

Batching
To make most of your time, group similar tasks, such as email reading, trade-news reading. Meetings and production time. Ask people to batch questions into scheduled times, like one-on-ones, instead of interrupting whenever they want. Make things regular, that were irregular.

Meetings

There are two kinds of meetings: process-oriented meetings, where information is shared, that are scheduled regularly, and mission-oriented meetings, to solve a specific problem, often to produce a decision, and that are called ad-hoc.

Timeliness is critical, It is criminal not to enforce it and allow latecomers to waste everyone's time. Being prepared is critical: if someone has not read up, stop the meeting and reschedule when they have. It is wasting everyone's costly time. Put discussion points that derail but need followup into a tickler file/list for future dates.

The One-on-one

Between manager, and direct report. Should at least last an hour, so the subordinate does not confine himself to simple things that can be handled quickly. It should be the subordinates meeting, with the agenda and tone set by him.

The subordinate should prepare an outline, which is important because it forces him to think through the points he plans to rise. He also should prepare supplementary material for that outline, and walk the supervisor through all the material.

Covered should be key indicators, especially those that signal trouble. Anything important that has happened since the last meeting, hiring problems, people problems, future plans, and very important - potential problems, issues that preoccupy and nag the subordinate. These are often obscure and take time to surface.

The supervisor should facilitate the subordinates expression of what is going on and bothering him. Do not talk with your subordinates about your problems, make them talk about theirs. Ask one more question, until you both feel you have gotten to the bottom of the problem. Be wary of a heart-to-heart issue brought up at last minute, though, when you can only with difficulty give it justice.

Both should take notes on the agenda, Take notes in outline form, which helps you categorize and sort the information. Follow up by checking last times notes in the next meeting. Create a "hold" file with important but non-urgent items for the next or future meetings. Exchange notes after the meeting, to make sure you have agreement.

One one ones foster development of a common base of information, handling of issues, enable effective delegation, and are essential if the supervisor is to make good decisions.

The Staff Meeting

A meeting of the supervisor with all his subordinates, to enable peer interaction. You get a much better understanding of an issue by listening to people with opposing views discussing it, instead of just listening to one person. Discussion is for anything affecting more than two persons present (otherwise, they can take it offline). If the meeting degenerates to a dialogue, suggest the two continue their discussion later.

An agenda should be prepared, but there also should be time at the end for open discussion of unscheduled items. Role of the supervisor is that of observer, expediter, questioner, decision-maker. Not lecturer.

The Operations review

Formal presentation to other managers, peers, and parts of the company. The organizing manager is the direct supervisor of the presenters, responsible for timekeeping, disseminating materials, organizing.  The reviewing manager it a higher-up manager, who should ask questions, make comments, set the spirit of the meeting, and encourage participation. The presenters should use visual aids. The audience should participate, make comments and ask questions, if something is not clear. Speak up if you disagree with an approach that is recommended. Go on record to correct factual errors. 

The Mission-oriented meeting

The chairman, the person who has most at stake has to drive this. He calls it, and he should prepare it. Imagine you are the chairman. Define a clear objective -- what needs to be resolved, what needs to be decided. (If you do not know what you want, you will not get it). Is the meeting necessary, defensible, justified? Only call it if it is, and call off it if can be resolved otherwise. The cost of meetings is about $100 per participant and hour. Identify who should attend and get them to come, or send someone else who is empowered to speak for him. Try and limit the meeting to six, maximally eight people, if you want a decision to be made. Maintain discipline. Call out latecomers. Make sure the needed equipment is present and in working order. Send out an agenda that clearly states the time, location, purpose, and everyone's role (presenter with duration, or not).

Once the meeting is over, nail down what happened, and send around minutes summarizing the discussion, decisions made, actions to be taken, by when and by whom. Send this out soon after the meeting, when it still is fresh on peoples mind. 

Decisions

Make or facilitate the making of good decisions

Decision-making produces a better decision if we are clear about: what decision needs to be made, by when, who will decide and who will be heard, who will ratify or veto it, and who then needs to be informed of it. Attendees to the decision meetings should have consulted their staff prior and gathered all relevant knowledge and views on the subject.

There is often a divergence between power of position, and power of knowledge. Junior people are closer to the issues and technology and understand them better. Make sure they are heard. Everybody should voice opinions as equals, ignoring status. The process for decision making should be 1. Free discussion, looking at the problem from all perspectives, 2. A clear decision, even if not everyone can agree it is the right one, 3. Full support by all, also those that did  not agree to implement it. If it turns out it was wrong, repeat. Take pains to frame the decision with utter clarity. Do not fudge to try and keep everyone happy by formulating it ambiguously.

Free discussion is the most difficult to achieve. People should express their view forcefully, but tend to hang back until they see a view winning, and then pile in to support it, to avoid being associated with a losing position. People are full of ambition, fear, insecurity. People are afraid to stick their necks out. People are afraid of sounding dumb, and do not ask, when they do not understand. They are afraid to be vetoed or overruled and thus to lose face in front of their peers. (I might add, they are also afraid of coming across as spoilsports, of being accused of undermining a can-do spirit). If sensitivities of two interest groups are involved, give both sides roughly equal representation in meetings to foster an even-handed decision.

Do not push for a decision prematurely, make sure you have heard and considered the real issues, rather than the superficial comments that often dominate the early stages of a meeting. Do not use authority to influence the exchange of views in any direction.

When all views and arguments have been brought out, when everything is heard, it is time to push for consensus. A decision has to be taken, even if no consensus can be found. A senior person with position authority must make a clear decision at that point.

To ratify a decision, listen to the alternatives and background, and reasons for the choice, and ask questions to probe the depth of information and thinking. If the final outcome is dramatically different from what people expect, make the announcement, adjourn so people have a chance to recover, then reconvene and solicit views, to help people accept and live with this outcome.

Approvals

For projects that require funding or capital, ask the subordinate to think through the entire matter carefully, before representing a request for approval. To test their thinking and decision making process, ask them specific questions during a review meeting. If they answer convincingly, approve.

Gather information

Visit plants, observe what is going. Visit customers. Read the trade press. Information gathering is the basis for all other managerial work. Gathering information is the basis for sharing and for making correct decisions. Customer complaints are a key input. Identify and defuse ticking time bombs before they go off. 

• Detect and fix errors in a process at the earliest, lowest value stage possible. Reject before investing further value. (It is much more costly later, requiring more rework, discarding more work already done). Review rough drafts of reports you have delegated.
• Use performance indicators to measure output (not: activity indicators, which measure only busy-ness, but no results, pair opposing ones to combat bias). Use credible leading indicators to look into the black box and get a feel for what the future may look like, and act on them. Use trend indicators, like a Stagger chart, that plots the development of forecasts over time. Collect these indicators ongoing and systematically.
• Reports and Plans. The most useful information comes from brief, direct discussion. But written reports are necessary, less for the reader, for the writer: they force him to think things through, force self-discipline on the thinking. Likewise, the resulting plan is not important, but the process of writing the plan is. A capital authorization process is a must, because of the soul-searching analysis that it forces to support the spending request.

Leadership 

Lead and Train your employees. 
Communicate your objectives, priorities, preferences. Transmitting objectives and preferences is key to successful delegation. Act as a role model -- nothing leads as well as example. Values and behavioral norms are not transmitted by talk or memo or wall poster, but by visible action. Share and disseminate information. Most of the time you do not issue direct commands, you "nudge".

When a person is not doing his job, this can have two reasons: he either can't do it, or won't do it. (Aside: either train him if he would but can't, find another job for him, or, failing that, let him go. And you need to improve your hiring process). Fear and punishment may work to drive galley slaves, but won't work on computer engineers.

You cannot motivate someone, real motivation comes from within. All other forms, like safety through compensation, belonging and social affiliation, esteem and recognition are self-limiting. The only source of motivation that has no limit is self-actualization. Being the best you can be. The need for achievement is boundless. At that level, money is not the objective, but it is a way to keep score, a measure of achievement. You cannot stay in this mode, if you are always worried about failure (Note: this from a guy who was an outstanding achiever and who wrote a book called Only the Paranoid Survive. Does not parse. I think what he means is that you must be willing to take risks, or you will never stretch to your limits.) For achievers, the most important is feedback on his performance. They run to beat other people's bests, or in the end, their bests. They do not need incentives, they need an arena. A good manager must be a coach: take no personal credit for the success of the team. With achievers, be tough on the team, be critical, expect more. To get the best performance out of them they can achieve. And it helps if he used to be a competitor himself, so he knows and understands.

Manage people based on their task-relevant maturity. An experienced person can be a newbie with a new task. If they are, be task oriented, offer detailed, precise instructions, what needs doing when and how. As they mature, move more to encouragement, emotional support, listening and mutual reasoning. As they become very mature, minimize your involvement, just make sure the objectives are agreed upon. But always monitor progress to avoid surprises. It's the difference between delegating and abdicating. In all cases, you are responsible to transmit common values, which are a must for effective delegation. And for pragmatic reasons, try to raise the task maturity of your employees as quickly as possible.

Should you make friends with employees? This is a personal decision. But you will need to give tough feedback, give orders to or maybe even lay off an employee; this is very hard to do to a friend. (At the same time, if you deeply care about people, you will give that feedback, and will be mindful and respectful when you have to take painful steps).

Performance Review

These Reviews are the most important form of task-relevant feedback you can give. They should be done in any size of organization. The desired output is to improve the subordinates performance. You must first judge fairly a fellow worker, and then deliver this judgment to him, face to face.  Review is dedicated to first assess the subordinate's skill level, determine missing skills, and find ways to remedy the lack; second to intensify the subordinates motivation.

Performance Review: Preparing

First, review material such as progress reviews, performance vs quarterly objectives, one-on-one meeting notes (take good notes, so you have them). Sit down with a blank sheet. Dump everything on it, do not edit in your head. Get it all down. Major, minor. Don't matter. Once you are done, put the supporting documentation away.

Now, organize the things in groups, for positives and negatives; identify common themes, shared strengths, weaknesses, and turn them into messages for the review. Support them with specific examples. Think about what they will be able to remember, and cull your list to the most important ones. Just one or two major ones.

Even if you did regular one-one-ones throughout the year, you may be surprised of your findings. And even if they are uncomfortable, they need to be delivered. If you discover a surprise, swallow hard, and deliver it.

Performance Review: Assessing and Judging

For useful review, define the goals up front. Output measures (stuff that could be plotted on charts, like bookings, designs delivered, increased production yield etc), but also internal measures that will define output for future periods: are we achieving our present results by sacrificing the future, disgruntling employees etc, or are we doing it in a way our business can handle its tasks in the future?

We must weigh long-term vs short-term oriented performance. How much will the future oriented work pay back over time? How much is it worth today? Look at the time offset between activity and resulting output -- often results this year are really the fruit of a previous year's work. Most jobs involve work that is not producing output in the period of review, still, it has to be assessed.

You need to be as objective as possible, but in the end you must judge performance, which naturally has to be subjective. It's not just recording what is measurable in plain sight. Judge his personal performance, as well as the overall performance in his group. In the end, what counts is the overall performance of the group and the manager must add value in some way. Hi performance rating cannot be higher than that of his organization. What counts is results, not good form. At all times, assess performance, not potential. It's a trap.

Performance Review: Delivering the Message

Level: be frank. The credibility of the entire system depends on it.

Listen: make sure they understand the message. The goal is not to even document you delivered it. It is not delivered, unless you have been heard and understood. Watch them, look for signs with all your senses. Listen with all your might to make sure they get the message, and do not stop delivering until they have. 

Leave yourself out: this is not about you. Forget your anxieties, insecurities, guilt. At issue are the subordinates problems, not the supervisors.

Limit: The goal is not to clean your system out. They may have a finite capacity to accept and process facts. Your goal is to deliver the most important ones, to improve their performance. 

Best deliver a written review to your subordinate some time before the face-to-face discussion. He can digest it and react or overreact to the messages, and by the time you meet will be much more prepared, emotionally and rationally. 

Reviewing poor performers: poor performers have a strong tendency to ignore their problem, passively ignoring or actively denying it. If they cannot, because of overwhelming supporting facts (which you need to collect), they might justify it, by blaming others. Things tend to get stuck at the blame-others stage. They must take the step to assume responsibility, to accept it is their problem. This is fateful, as it means work. Once responsibility has been taken, finding a solution may be relatively easy. Assuming responsibility is an emotional step, which is much harder than the intellectual one of problem-solving. You as the supervisor must move them through all the stages of this process. You cannot try to go find a solution with him, if he still is stuck at blaming others or denying the issue. Knowing where you are will help you to move through together.

It is sufficient, if they commit to do it, even if they do not agree with your view. They do not need to side with you. They just need to commit themselves to pursue a course of action. On the job, we are after a person's performance, not our psychological comfort. Say "This is what I as your boss, am instructing you to do. I understand you do not see it my way. You may be right, or I may be right. But I am not only empowered, but also required to give you instructions, and this is what I want you to do..."

Reviewing the ace: concentrating on the stars is a high-leverage activity. If they get better, the impact on group output is great. No matter how stellar a persons performance, there is always room for improvment (?)

Review template: Name and role, review period, description of assigment (full paragraphs); accomplishments during the period (full paragraphs); evaluation with areas of strength and for improvment (full paragraphs, messages with supporting examples); outlook and recommendations (full paragraphs); overall performance score. Signed by manager, employee, HR with date

Read all the evaluations written by your own reports, and a random sampling from below that level in the hierarchy. Send them back with comments, and high visibility of this activity, if you want to impress the importance of this process on your organization.

Hiring and Interviewing

Interviews serve to select a good performer, educate him about your company, identify if there is a match, and sell him on the job. Reference checks do not exempt you from getting as much as possible out of the interview. Try to have a bit of a longer conversation with the reference giver, to build a relationship. Often you learn the most valuable information towards the end.

The applicant should do 80% of the talking, and it is up to you to steer what about. If they drone on, interrupt or stop them to conserve the valuable time you have with them. Apologize if you like and say, "I'd like to change the subject to ...". Try to talk about areas where both of you have expertise. Try to assess their technical expertise, their skill level ("describe some projects"), as well as how he performed in previous jobs using what he knows ("past achievements, past failures". Try to understand why there are discrepancies ("what did you learn from failures, what are problems in the current position"). Try to understand their operational values ("why do you want to change"). Don't worry to be blunt and direct. You can ask "How good are you technically?", and learn something from the response. Ask them how they would handle a hypothetical situation. Ask him what he would like to know, to understand how he thinks and how well prepared he is.

Show yourself and your environment how they really are. No point to hire someone, and then he hates it here.

Retaining Quitters
When a key employee quits, deal with it right away. Often this is about recognition, he feels unappreciated and unimportant to you. Don't confirm these feelings. Drop what you are doing. Sit him down and talk with him, why he is quitting. Let him talk, do not argue -- he has rehearsed his reasons many times. Let him talk, then ask him more questions. Because after the prepared points have delivered, the real issues will surface. You have to convince him by what you do, that he is important. Do not try to change his mind at this point. Then go to your supervisor for help and advice. Make him participate in the solution to your problem. If you cannot keep him with you, try if you can save him at least for the company. If all managers take this position, they will all win in the long run.

They will already have accepted, so you have to make them quit again. Say he really has made two commitments -- one to the new employer whom he barely knows, and one to you, his present employer.

Keeping them is even more important for the overall company than just his work. Other good people will respect him, and see this as an example to follow.

Compensation and Promotions
Once the absolute raise in compensation is not important any more, but the relative raise, you are out of the area of fulfilling basic security needs, and into the area, where money really just is a measure of success, for self-actualization. You want to allocate money, like promotions, as task relevant feedback. It always should be tied to performance. If you practice a pure tenure based policy, your message is that performance does not matter. A performance based system is obviously more work, as it requires a competitive, comparative evaluation of employees.

No action communicates values more clearly and loudly to the organization than a promotion. By elevating someone, we effectively create role models for the organization. They must be based on performance, to keep the idea of performance highlighted and alive. The Peter Principle unfortunately cannot be avoided, as you only learn if someone is up to the new task after they have been promoted, and not promoting them to keep them at their current job where they perform great, will make them leave unless they are happy that way. The one solution is to agree with them to go back to their old job -- obviously very difficult to do, but if done, often works wonderfully for both sides.

For managers, base a part of his compensation on the performance of his team, the performance bonus. Consider if you want to base this purely on quantitative terms, or if you want to balance with appraisal and be exposed to a beauty contest. Make sure that if the company overall does not perform well, than neither will the bonuses.

Training is the Boss's job
It is the highest leverage activity you can perform. To be effective it needs to be reliable and regular, not an ad-hoc patching up of issues, a process, not an event. The managers themselves should do it, as they are believable role models. 2-4% of the work time should be spent on training (about a week per year). You can train managers skills such as strategic planning, communication style.

The first task is to train new employees on the ways and values of the company. The second one is training new skills to all. Ask people what they think what training they need, then make a list of possible trainings to give. Take inventory of the available managers and materials, and make a priority list to deliver. Start small - one short course on one subject. Define a course schedule, with deadlines, prepare just the outline and the first session and go. (To force yourself not to get lost in spending all your time to prepare this). To limit damage, first do a trial run to knowledgeable employees, who can help you refine it. After delivering it, ask for anonymous ratings, in score but also open ended comments. Be aware you'll never satisfy everyone -- what is too detailed for one person is to superficial for another. The person who will learn most from the course, of course, will be - you.

Find the most cost-effective way to deploy your resources.

Analyze processes for work simplification: chart out every single step. Then look for simplifications, cutting 30-50% of the steps. ("Complicated cases make bad laws"). If there is a set deadline, work backwards from there, identify the rate limiting steps, and arrange the rest around it.

Plan

1. Establish projected need -- what will the changing environment demand of you, your business, your organization? (Don't consider at this stage what practical steps to take to get there, this will just confuse the issue). How do you know?
2. Establish your present status -- what will you produce if you do not do anything different than what you do now?
3. Reconcile -- what will you need to do to to close the gap and produce what the environment will demand?  What can you do? Then decide what actions to take. This set of actions is essentially your strategy, and the details to implement them are the tactics. The strategy on one managerial level is often the tactics on the next higher level.

Today's gap represents a failure of recognizing and planning in the past. What do you have to do today to solve or better avoid tomorrows problems? In long term planning, look at the next five years. But what you really influence, is the next year. You will only implement one portion of the overall plan, before you review it. Be careful not to plan too frequently, so you have time to judge the impact of the decisions made and see if you are on the right track or not. (Annual seems reasonable, with monthly or quarterly progress review).

Involve the operating management in planning. Planners must be the very people that have to implement the plan.

Saying yes to a project means saying no to something else. Keep the number of projects small. If you focus on everything, you focus on nothing. Each objective must be specific and have a due date, so there is no room for ambiguity.

Organize

"All large organizations with a common business purpose end up in hybrid organizational form", that is, with functional company wide units that enable critical mass of know-how (sales, R&D, admin), and localized or product-specialized business units that enable the business to respond to the demands and needs of the market environment. Thus, many people will need to dual report -- to the local or business manager, and to the functional  or corporate manager. There also can be peer group supervision. For this to work, you must have a strong and positive corporate culture.

The most important characteristic of culture is that the interest of the group to which an individual belongs takes precedence over the interest of the individual himself. For this to happen, all need to share a common set of values, a common set of objectives, a common set of methods, generated by common, shared experience. This makes it easier to work on tasks with high complexity, ambiguity and uncertainty (which are often the higher paid leadership roles). New employees cannot have this culture, need to get familiar with it, so will have a hard time coming into a leadership position from the outside in a company with strong company culture.

Made to Stick [Book]

by Chip & Dan Heath

I rate this book on how to create messages that stick, influence how people act and are retold as slightly above average as far as easy reading business books go. The material does not much suffer much from aging. The findings are reasonable albeit somewhat unsurprising. Even has a nice quick reference in the back.

Their main point is to overcome the Curse of Knowledge: it is extremely hard to forget everything you learned yourself about your specialty, put yourself in your listeners' or readers' shoes and create messages that work for them and their background knowledge.

According to the authors and studies they cite, good messages share some common attributes:

1. Simple. Good messages keep to the main point, like finding the headline for a newspaper article. What is the single most important thing? If you have 5 different messages, you have none. Express it succinctly. Images and Analogies to things the listener knows work well to get the idea across. Examples: Movie concept pitches, Commander's Intent, SW Airlines as "THE low-fare areline".

2. Unexpected. An element of surprise helps to capture attention. Asking questions to pique curiosity, delay answers to keep interest. Unexpected and audacious objectives. Examples:  pocketable radio, putting a man on the moon. There will be no school next Thursday. 

3. Concrete. It is hard to picture or remember abstractions or statistics. Again, images help, examples and prototypes help. Many hooks help (Velro theory of memory). Experiencing things helps. Map things to ones experienced at human scale. Compare fables, proverbs. BB bullets to show nuclear proliferation, blue vs brown eyes "the wave" experiement. White things vs white things in your fridge. Rookie orientation on AIDS. Visualize what it would be like.

4. Credible. Details help. Authorities help. Anti-Authorities, i.e. normal people just like the listeners help. The Sinatra test (one proof point that is all you need "If you can make it there you make it anywhere"). Testable credentials -- i.e. let the audience try it themselves / answer it for themselves.

5. Emotional. If you don't get moved by the message, you will likely forget it quickly. Use individuals, not groups (1 death is a tragedy, 10,000 is a statistic); use emotional stories that work for the audience's identity/self-image (rebellion for youth, toughness for rednecks); appeal to self-interest "What's in it for me?", but do not just appeal to Maslow's Basement.  Examples: "They laughed when I sat down at the piano ... but when I started to play!" mail order ads, Don't mess with Texas. 

6. Stories. We are wired to remember stories, not data. Keep your eyes and ears open for stories you can use. Typical plots: challenge - stepping up against near impossible odds, connection - family, friendship etc., creativity - surprising solutions to overcome challenges. Stories also often are emotional, visual/concrete, have details to make them credible, or unexpected twists. Examples: heart monitor, Jared and the subway diet

All of which combines to a cringe-inducing SUCCES acronym.

The Practice of Management

The Practice of Management
by Peter F. Drucker
 
Preamble

Like all of Drucker’s books, there is a lot of deep insight here, and some common themes reiterated. Especially the sections on the spirit of an organization, management by objectives are good.

This one is a bit dated, being published in 1955 first. Apparently “automation” was all the rage at the time, as Drucker oracles on how it will influence the work environment throughout (calling it “the new technology”). Drucker also differentiates between managing managers, professional employees and “workers”, writing at a time of industrial production on the assembly line, with few “knowledge” or “professional” workers, and a lot of unskilled labor. He talks at length about the managerial role of foremen etc. Other books of his have aged better in this regard. As ideally the worker should be able to look at the business with managerial viewpoint to do the right thing, and Drucker prescribes largely the same focus areas for both groups, I will combine them here.

Management is about managing the business, and the enterprise.

The Business

The purpose of a business is to create a customer through marketing and innovation.

Thus, managing a business is entrepreneurial, it cannot be bureaucratic or administrative. It cannot be passive or adaptive. It must take decisions on actions to create future results.

Marketing

The customer determines what a business is. What the customer thinks he is buying, what he considers value is decisive. It determines what a business needs to be and to produce to prosper. Marketing is figuring out what this is, and providing it. Not just selling what the business happens to make.

What is our business, and what should it be?

Ask yourself: Who is the customer? The actual and potential customer? Where is he, how does he buy, how can he be reached? And most crucial: what does he buy? What does he consider value? What are his unsatisfied needs? What does he look for, when he buys the product? (For some luxury goods, the high price itself is value). Never try to guess, ask or even better, observe!

How will trends, economic developments, innovation, technology, fashion and taste change? How will they affect what the customer wants and needs, and what wants and needs do exist that are not met by services and products offered today? Therefore: What should our business be? Are we in the right business, or should we change? To what? This may be many kinds of change, like change to a service model? Instead of selling new customers, keep and expand old ones?

Services should always be measured by regular, unbiased and systematic questioning of the customer. This may take the form of an annual customer survey.

A business that supplies less than a certain share of the market becomes a marginal supplier.

Innovation

Innovation can be in lower price, better product, new convenience or creation of a new want. It goes through all parts of a business, design, production, marketing, management. Successful companies are in danger of living of past successes instead of continuing to innovate.

In Innovating for productivity gains, scheduling of work flow is the greatest time saver. Mass production is based on uniform parts or modules, which can be assembled into a great variety of products. The burden of diversity is shifted from manufacturing to assembly.

Profit

Enterprise must operate with adequate profit, it is its social responsibility as well as its first duty towards itself and its workers. It is the first duty of the business to survive, that is, to avoid loss and liquidation. Sufficient profit is the only source to cover the risks of economic activity. Profit is the final result of successful business activity.

Profit is not the purpose of business, nor the reason for its behavior and decisions: it is how results are measured.

Management must maintain its wealth producing resources intact by making profit to offset the risk of economic activity. It must increase these resources and with them the wealth of society. A shareholder always can sell his stock, but society is stuck with the enterprise, and has to take the impoverishment if the enterprise does not succeed with innovation and growth, does not succeed in generating adequate profit.

Profit is the yardstick to warn you from pouring money and energy into bolstering the weak, ailing and declining, instead of strengthening the strong and growing among your ventures. It also should block the dangerous and most deceptive alibi for following the line of least resistance: that an otherwise unprofitable venture pays for itself by “absorbing overhead”.

You measure profit as return on invested capital over borrowing cost. (Other, simpler methods may also be applicable, like as percentage of sales; depends on your goals).

If a management cannot over a reasonable period of time create profit, it should abdicate. If the business will not be able to create profit for too long, eventually it will fail.

Where will capital come from? How much will you need? What is the capital market rate for financing? What will your ROI be (see EVA)? Plan capital supply and calculate expected profit over capital cost over the life of the investment. This also overcomes artificial annual budgeting.

You need a rational capital-allocation policy. Otherwise you will always arbitrarily grant or withhold capital and centralize the management of cash. It must be based on a reasonable and reliable assessment of the ratio between returns and risks. (How?) How much should go into productivity improvements? How much into new designs? “Any fool can stay in budget, but it’s hard to draft a budget worth staying within.”

No company can be good at everything. Focus on your strengths. Outsource what others can do 
better.

Society

The enterprise must consider the impact of every business policy and action on society.

Responsibility implies authority. You can only be held responsible for that which you had the power to decide. There can be no responsibility without authority. As it would be intolerable for management to have authority over colleges, culture, the arts, free press, society cannot ask it to take responsibility for them. Management and enterprise can only assume responsibility for that on which it legitimately can claim authority, and indeed owes society to take responsibility there.

What is good for the country must be good for business, not the other way round. Hostility to capitalism is moral and ethical. It is attacked not because it does not work, but, because it is cynical. A society based on the assertion that private vices like greed will turn into public good cannot endure. In a lasting, moral society, the public good must always rest on private virtue. 
The enterprise
The needs of the customer have to be turned into action in the enterprise. The manager has to bring out whatever strength is there in his resources — especially people — and neutralize whatever there is in weakness.

Balancing contradicting needs is the hallmark of good management. One core challenge is balancing the short and long term needs. If the enterprise is not profitable in the present, there will be no enterprise in the future. Depreciation replacement, maintenance, capital replacement, research, product development, design, training and education, promotion and advertising, service — you can save on all these in the short term to make numbers look good, but will hurt the long term prospects of the business. You can increase them all short term, and may see results only in the long term. Modest but steady over time beats frantic back and forth. It also gives job stability to people.

Whatever he does should be sound in expediency as well as in basic long range objective and principle. He has to harmonize immediate and long term needs. Where he cannot harmonize them, he must carefully balance sacrifices. (Look at the detail to understand the big picture).

The basic operations in the work of the manager are setting objectives, organizing and planning work and jobs, developing and motivating people, and measuring . The contribution of the manager is uniquely to provide vision and ability to perform. It is vision and moral responsibility that in the last analysis define the manager.

1. He sets objectives, derived from the needs of the business in general and derived from this in each area. He communicates them to the people whose performance is needed to obtain them. This requires reconciling business outcomes and the principles one believes in, immediate need and future need, desirable ends and available means. It therefore requires analytical and synthesizing ability.

Spend more time on listening than talking. Do not talk to your men about your own problems, but make them talk about theirs. They spend a great deal of time on a half-yearly manager letter, up to a whole day for each of their reports. They think about their boss’ problems, the enterprises, and what they can do to help.

2. He organizes. He analyzes activities, decisions and relations needed. He classifies the work and divides it into manageable activities, and those into jobs. He groups these activities and jobs into an organizational structure (see Sloane). This again requires analytical ability.

3. He develops and motivates people. He does so through giving them responsibility, incentives, fair promotion policy. He selects people for the management of units and jobs. He helps them in developing themselves .

This requires integrity, justice, care, and respect. He needs to put the common good of the company before his own advantage. Integrity of character is something that cannot be learned, and is central. (I think he learned this from Sloane, too).

4. He measures. He establishes meaningful yardsticks that capture performance for the overall enterprise as well as for the key areas of business performance, and actionable performance of the individual. He makes these measurements available for self-control to each man, rather than for control. Without measuring, there can be no rational decision making. This again requires analytical ability.

Planning

Work will become easier and more effective and productive, when we plan before we do. Managers who know the use of time well succeed by planning. They spend a lot of time thinking through areas in which objectives should be set, and a great deal more on thinking through systematically what to do with recurrent problems. If they have a recurrent crisis, they spent time to find out what causes it to avoid repetition.

This does not mean the planner and doer should be different people. There is better planning if the man to carry out the work is involved in the planning. What is a good strategy to plan?

At its core is the study and analysis of work into simplest elements, and then improving the workers performance on each of these elements. This idea of being able to improve work by first breaking it down into its constituent elements, laying them out in a logical order, and work to improve them was a liberating, pioneering insight.

How well people are managed determines if goals will be reached. A great plan fails in flawed execution. (Welch — simple plans and powerful execution are more nimble and beat big planning).

No management by drives. It is a sign of lack of planning and of confusion.

Maxims

Give people maximum authority, and full responsibility for results.
You get what you reward, not, what you preach.
You can only lead by example.

Management by objectives

Each job should have clearly spelled out objectives. How is it to help other units, and what it can expect from them? Teamwork must be considered right from the start. The objectives should cover all areas of the business affected, even if the contribution is small, so people understand the overall needs and the need to balance. They should include both tangible business objectives, performance and development. Good objectives give people clear information what is expected from them.

The manager should develop the objectives for his unit himself. Higher management should review, approve or disapprove. Each manager should participate in setting objectives for the higher unit of which he is a part. The goals should be measurable. The measure must not be rigidly quantitative or exact, but clear, simple and rational, and should direct attentions and efforts where they need to go. The measurements should go to the manager himself, not to his superior. (Goodhearts Law: “when a measure becomes a target, it ceases to be a good measure”; SMART goals, e.g. specific, measurable, agreed, realistic, time-bound)

In a “manager’s letter” written once or twice a year each manager should define the objectives of his superior’s job and of his own; the performance standards which he believes are applied to him; the things he must do to attain these goals, the major obstacles; the things that his superior and the company do to help or hamper him. Are there conflicting demands made, or work asked for that is then not used? Grievances and suggestions what can be done to fix them. Finally, what he proposes to do during the next year to reach his goals.

Understanding can never be attained just by communicating down, by telling. It only can be by asking, and listening.

Procedures only can work where judgment is no longer required. The test of a good procedure is that it quickly identifies situations that do not fit the pattern but require special handling and judgment. Reports are often abused as an instrument for control from above. Reports and procedures should be kept to a minimum, and used only if they save time and labor. At least once every few years all reports should be stopped, and only the ones re-established, which managers still requested after living without them for a month or two. They should focus on the key performance areas. To “control” everything is to control nothing.

The ability to go around obstacles rather than charge them head-on is a major requirement for managing by objectives. (See also Richard Branson)
Make real budgets, and let people run with them. Do not run your division managers jobs, and do not appraise them on how much they allow you to do so. It is ineffectual and de-motivating. “Projectitis” is a common disease resulting from attempts of management to control professional work which they do not understand.

Leadership – the Spirit of the Organization

A man lacking in integrity destroys people, spirit and performance. The spirit of an organization is created from the top. If it decays, it is so because the top rots. (This is called values nowadays).

The purpose of an organization is to “make common men do uncommon things” (Lord Beveridge). The test of good spirit is performance, not conformance. It’s the abilities, not the disabilities that count. Only high performance can build spirit.

It is the willingness of people to give of themselves over and above the needs of the job that distinguishes the great organization.

A manager who sets his goals low, and consistently fails to perform must be removed from his job. Decisions on a person demand the greatest consideration for the individual. If possible give them another job fitting his strengths — you should be able to find one with effort and imagination.

What is needed for proper spirit is morality: emphasis on strength, integrity, high standards of justice and conduct. Again here, you get what you reward, not, what you preach. And you can only lead by example. It must be practice, not sermon.

People may forgive ignorance, bad manners, insecurity but they will not forgive lack of integrity.

1. No condoning of mediocre or poor performance.
2. Each job must be a rewarding job in itself.
3. A rational and just promotion system.
4. Clarity: who makes salary, job scope, promotion and demotion and dismissal decisions?
5. Integrity : no lies, keep your word, treat people with respect.

Do not promote a man to management: Who focuses on people’s weaknesses; Who is more interested in the question “Who is right?” than “What is right?”; Who considers intelligence more important than integrity; Who is afraid of strong subordinates; Who does not set high standards for his own work, for it breeds contempt for the work and managements competence.

You cannot buy loyalty; you can only earn it.
Leadership cannot be taught or learned.

Decisions

Whatever a manager does, he does through making decisions.

The important decisions, the ones that really matter are strategic. They are about finding out what the situation is, or changing it: on business objectives, organizational, affecting productivity, or about major capital-expenditure decisions. For these, the hard part is not problem solving, it is asking the right question. Few things are as dangerous as the right answer to the wrong question.

A decision should always be made at the lowest possible level, as close to the action as possible. It also should be made at the level where all that it impacts are considered. The first tells how far down it should be made, the second, how far down it can.

Once the decision has been made, it is essential that it be carried out. Nothing is as useless as the right answer that quietly disappears into the filing cabinet, or that is quietly sabotaged by the people supposed to carry it out. Decision-making has five phases:

1. Defining the problem

What courses of action are unacceptable and can be discarded, because of fundamental values, economic, moral, structural, cultural issues that cannot be touched? (quick-screen)
What is the critical factor that has to change before anything else can be done?
What will happen in time, if nothing is changed?
What could have been done or avoided, when the problem first appeared, that would have altered the present situation?
It the problem lack of or contradiction of objectives or organizational structure? Is it changes in the environment?

2. Analyzing the problem (finding the root cause of the problem)

Understand who must make the decision, who must be consulted and who informed:

i. What is the futurity of the decision — for how long into the future does it commit the company? How fast can it be reversed?
ii. What is the impact on other areas and functions — how much of the business does it affect?
iii. Does it affect fundamental values? What political, ethical, social questions have to be considered on that level?
iv. Is it a unique decision or is it recurrent? Does it only appear to be unique? The recurrent decision requires the establishment of a general rule, that is, a decision in principle. The rule needs maybe to be decided on a high level, but its application can then be done at a lower level. (This is like laws).

You will never have all the facts. Decisions must be made on incomplete knowledge. It usually is either impossible or too costly to get complete information.

3. Developing alternative solutions

We tend to see one solution and consider it the right if not the only one. Look for at least two or three alternative solutions. Do not just do the first thing that comes to mind. Alternative solutions are the only means to bring underlying assumptions out, and test if they are right. They are to only tool to force us to use our imaginations.

People who have to carry out the decision should always be involved in the work of developing the alternatives. All the typical creativity tools can be used here.

No action is a decision as valid as all other ones. Spell out the consequences that follow from a decision for no action.

4. Deciding upon the best solution

i. The decision should accomplish the desired end with minimum effort and disturbance. Don’t pick an Elephant gun to kill sparrows. What will give the most result for the least effort and disturbance? Often a 80% solution that is easily done is preferable to a vastly more resource-hungry 100% solution. (I combined here risk and effort.)
ii. Timing. Is urgent action needed, or long, continuous effort?
iii. Ability to implement. No decision can be better than the people who have to carry it out. It is well possible that the solution requires skill from people they do not possess today. Then the right course is to hire or train people to obtain this knowledge. The wrong decision may never be adopted because people and the competence to do what is right are lacking. If a solution requires more of people than they can give, they must learn to give more or be replaced by people who can. (How do you afford this? Often you are restricted by economical reasons to not do that?)

5. Converting the decision into effective action

Time spent on “selling” the solution is a waste. If the first steps were done right, it will sell itself by improving things. Also, what is right is determined by the nature of the problem. If people like it or not is quite irrelevant. They must be led to accept it, if they first like it or not.
To do so, remember the first law of rhetoric: present it to them in the language they speak and understand.

Organizational Structure

Whatever strength individuals have must become the source of strength for the whole group — that is the first principle of organization. If there is a lack of a clear organization, people spent their time trying to figure out what they should do, instead of doing it. A good structure is not the end, but it is a necessary foundation; without it, most other managerial efforts will come to naught.

To create a working organizational structure, look at the activities that need to be carried out, and the relations between different groups that are affected by them, sideways and upwards. In a small enterprise, they should be able to be done in a few hours and a few sheets of paper. (Then consider the people you have and their strength.)

The largest possible number of managers should have business responsibility, and be measured by business results, not by professional criteria. They should not be administrators or bureaucrats. The structure should encourage new products and businesses, and discourage old, unprofitable products and businesses to continue.

It should have the least possible number of management levels. Take heed of the Catholic Church, which has only one level, the bishop, between the Pope and the lowly priest.

Managerial control can only handle six to eight subordinates. Managerial responsibility, counseling, can be many more. A manager should always have more people than he can control, so he will not have the time to try and take over their jobs. Teams should normally not exceed five or six members, and they work best with three to four. (Communication channels grow n*(n-1)/2 with people involved). Only individuals can manage, teams are better to disperse policy.

Many levels are a sign of bad organization, as is overhead, such as co-ordinators, assistants, liaisons; as are lots of coordinating meetings, committees; as is going through the “proper channels” instead of directly to the man who has the information. The latter is not just a symptom, it is a cause of misorganization.

Overhead includes management and innovation work, but also waste like mismanagement and bad organization (the “co-ordinator” is a sure sign of it).

The structure should enable the training and testing of tomorrows managers buy giving them actual management responsibility in an autonomous position, where they at least can see the whole business.

Functional organization

Proper functional organization is by stage of process. Functional organization should always aim to give as complete products as possible, so that the objectives of the functional manager are connected to business results. Ideally every functional manager should report to the general manager of a unit or product business. An enterprise is too big for functional organization, if it requires more than two levels of functional managers.
Every functional manager tries to increase the importance and influence of his function, often even to the detriment of the overall business. It is human nature.

Small business has functional organization. The main problem of the small business is that it typically cannot support the management it needs. Top management should set aside at least one week each year for a review conference, out of office, to get away from day-to-day, and think about the bigger picture. It should be attended by every senior member of management. It should focus on the needs of the company years ahead, and on setting objectives for all key areas. It should appraise results in these areas achieved it the past year, and assign responsibility for them to individual members of the group.

Federal decentralization is more powerful than functional decentralization, but it works only for larger enterprises. (Skipping the part about non-small and large businesses.) Central management must be able to override local ambitions. (E.g. by setting products or price ranges). Someone who has shown extraordinary good performance should be considered a candidate for promotion out of his original unit.

Growth

The requirement for successful growth is the ability of management to drastically change its basic attitudes and behavior (probably because fast growth changes the nature of the business, and what was good for a startup, does not work in a more mature organization?)

The problem of size cannot be met by trying to keep in communication with managers or employees as far down as possible. That is neither required nor desirable. The larger the business, the more will top management be concerned with setting objectives, and the less with the steps to their attainment. The personal touch is no substitute for performance.

The normal reason for growth is success and the normal reason for success is able management. That problems of growth are problems of success is why they are so difficult.

CEO and the board

The CEO thinks trough the business of the company, develops overall objectives, makes the decisions to reach them, and communicates them to his management, educates it to see the business as a whole, helps them to develop their own objectives from those of the business, reviews them and measures performance and results against them. He ensures that there is a bench of managers being developed, makes basic decisions on organizing the company, arbitrates in case of conflict, and asks his managers the right questions. He only takes personal command in an emergency. He negotiates, plans capital expenditure, and suggests dividend to the board. He prepares the agenda for the board meeting.

Do not waste your time running functions, when you should be leading the organization. Entertaining customers or supporting sales, correcting technical plans, checking expenditures of others is not your job. You not only fail to do your work, you prevent others from doing theirs. (What about management by walking around, i.e. staying in touch with people on all levels to develop a feeling what is going on?)

If the top man gets a salary several times as large as number two, three or four, you can be pretty sure that the firm is badly managed. (Drucker then goes on that the job is too large for one man, and must be done by a team, with one maybe first among equals. The idea has taken hold in other C-level positions).

The board is not a governing organ, although it legally represents the owners and holds all power. It acts only in crisis, and then only to remove executives that failed and to appoint new ones. Otherwise its role is review, appraisal, appeal. It must be detached from operations and see the company as a whole. Working executives may not dominate it.

Motivating workers

The two most important areas in the management of workers are the organization of work, and the placement and development of the people who do the work. And this can only be done by the line managers. It must build on underlying strength and focus on the positive. Experience shows that what a man is good at is also what he wants to do. Organizing for work means putting the man on the job he will do best.

It is not the business of the enterprise to create worker happiness, but to make and sell shoes. (Or, databases). Still, to perform the task of the management is to reach the worker’s motivation and to enlist his participation, to mobilize his desire to work. How?

Motivation must have its center in the work.

The work itself must be meaningful. The enterprise must demand active assumption of responsibility for results by the worker. It can nourish this by careful placement, high standards of performance, providing the information the worker needs to control himself, and by participation that gives the worker managerial vision.

The worker demands justice through equal opportunity for advancement; that his work be meaningful and serious. High standards of performance and a high degree of competence in the way the work is organized and managed, and visible signs of managements concern for good work (see employees complaining about bad quality in other sites, and management’s apparent disinterest in this fact. But what is quality? It is not what we build in, it is what our users get out.)

Plan and schedule work ahead of time. Keep things spotless (tools, machines, code). Insist on the best tools and replace them when they wear out. That’s all that is needed. No fancy HR gimmicks.

Human resources or personnel administration departments are always going to be constrained to administrative and incidental chores, lest they usurp managerial positions that are focusing on business outcomes. They tend to put the stress on inter-personal relations, missing the point. The good professional employee has little respect for the administrator.

Developing people

Development is always self-development. The best people educate themselves. Responsibility rests with the individual, his efforts, his abilities. But you must think about each person’s strengths to give them opportunity. For this the best is a systematic way of appraising performance. How to offer challenges and opportunities for the individual development of each worker to the fullest of his ability?

The decisions to hire, to appoint and to promote are the most crucial decisions you can make. Job requirements and organizational structure will change as they always have. Development must not just replace yesterday, but focus on the needs of tomorrow. What skills will be needed? What knowledge? Thus placement must be a continuous and systematic effort and is one of the most important tasks in the management of worker and work. It must be reviewed continually. It must give workers the opportunity to rise from the bottom according to their ability.

Management must demand also that the worker be willing to accept change. For this, change must appear as an improvement. It must not be so fast as to make people feel lost. It must be rational.

You need a formal performance appraisal process, best with feedback from peers. The reason for promotion must always be performance, not “potential”. Identify strength, the greatest mistake is to try and build on weakness (see Hornblower). Only when the strengths are known, does it make sense to ask: what weaknesses must be overcome to make the progress the strengths would support? Give people a way to appeal against wrong decisions at a higher level. Promotion should not be entirely from within. That should be the norm, but exclusivity leads to inbreeding.

If developing people is the most important thing for success, then if follows that you only can be the best and develop yourself by learning to make others successful. No one can develop himself unless he works at the development of others.

It is not necessary that everybody be promoted but it is necessary that everybody knows there are opportunities for the man who performs well. There will always be more people wanting to get recognized through promotion than opportunities for promotion, and some will be driven into opposition of management by this in order to exercise their leadership.

Because placement decisions are so important, they should be reviewed by a manager’s supervisor; but they should be the managers to make, otherwise he lacks real authority and consequently responsibility.

The long-term survival of any enterprise depends on being able to hire the ablest, most dedicated young people. For this, the promise of a living is not enough. The enterprise must be able to give such man a vision and a sense of mission, to satisfy their desire to meaningful contribution to society (well, at least for idealists. There are some who just want to get rich).

The power of a company to attract good man is proportional to its name for excellence.
High standards of performance 
The enterprise must demand more than a fair day’s work. It must build esprit de corps. The work must encourage and demand the growth of the individual that performs it. The job must always challenge the worker. The nature of man demands that performance of the best, not of the worst be the goal for all. It is the peculiarity of man that he yields best to high demands. The capacity to produce depends largely on the level of demands made (see Edgar).

Management must set and enforce on itself high standards for its own performance of those functions that determine the workers ability to perform. Few things constitute such conclusive proof of management’s incompetence as when people idle. The first test on its competence is its ability to keep people working with minimal disruption.

Information, Measurement and managerial vision

No sale, no job.

People need to know what is expected of them (see Management by objectives above). Let people measure their own work. They will be finding more ingenious ways by themselves to improve, especially if there is competition.

Managerial vision means that the vision of the individual must be directed towards the overall goals of the business, their will and efforts be bent towards reaching these goals. The worker will assume responsibility and act for the good of the whole only if he has managerial vision, that is, if he sees the enterprise as if he were a manager responsible for its success.

There are powerful forces of misdirection in the specialization of work, the hierarchical structure and in differences in vision and values. Especially dangerous is the employee who aims to do the best possible professional job in his area, and disregards the overall goals and needs of the enterprise for it. Professional work must have highest standards lest it be dishonest and corrupts. But performance must be measured to overall goals, not just the own professional criteria. Otherwise the professional work becomes a centrifugal force to pull the enterprise apart.

Any job whose objectives can be set in the main focusing directly on business objectives is a managerial one. Any job whose objectives cannot be so derived is not; it is a professional one. The worker must know how his work relates to the overall enterprise. This is challenging as conventional data (P&L, Balance, etc) mean nothing to him.

Internally the company is not a market economy. It is directed. So while the effort of management is increasing the total product, the effort of the worker is receiving a larger share, whatever the total product may be. Outside the enterprise, considerations are economic. Inside they are based on power balance and power relationships. The enterprise needs flexibility of the wage burden, the worker needs steady and predictable income. To the enterprise profit is a necessity for survival. To the worker, it is someone else’s income.

Organizations are not the extension of individuals. They create their own political sphere, with relationships involving real and health problems of power, and conflicts which are not conflicts of personality, but objective conflicts of vision and interest.

Security of continuing employment is the one really important security for the worker. Next to it, all others pale. Their job is their stake in the enterprise. Thus, the real job is to convince workers that there is an ever-present danger of loss, that profit therefore is necessary to build their own future job and livelihood, that profits will make it more secure and enjoyable.

Job rotation is not useful, when the goal is understanding business as a whole, experience at one or two narrow specialties does not help. A good course on marketing or a good book teaches this much better.

How not to motivate

Money is important as a hygiene factor — its absence damages. But satisfaction with money is not a sufficient positive motivation.

Fear corrupts him who uses it and him who fears. Fear is not a good tool to motivate people who can escape. Absence of fear is not motivation by itself either. There is no worse sin than turning a man’s capacity to perform into a threat for himself and others.

The tendency of many enterprises to assume paternal authority over their people and demand of them a special allegiance is socially irresponsible usurpation, indefensible on the grounds alike of public benefit and the company’s self interest. 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 citizenship.

A man who is deeply dissatisfied may quit or become bitter and move into opposition to the company and management.