The following contains excerpts from the book, Five Most Important Questions (Peter Drucker).
As a musician and artist, it is critically important to understand the reasons we do what we do. At our music school in Odessa, Texas we encourage each student to personally answer that question. Everyone will have a different answer, of course, but not to ask the question is a failure, in itself.
This book was written specifically towards ‘non-profit’ organizations, to help them clarify their vision and strategic planning. He attempts to utilize techniques found in the business world adapted to organizations that do not function so much as merchants with a tangible product, but still with a need for realistic goals for their function in society.
The five questions are: 1) What is our mission? 2) Who is our customer? 3) What does the customer value? 4) What are our results? 5) What is our plan?
What Does the Customer Value?
Drucker says that we must ask questions like, ‘What knowledge do we need to gain from our customers?’ and How will I participate in gaining this knowledge?’
“The first rule is that there are no irrational customers…Leadership should not even try to guess at the answers but should always go to the customers in a systematic quest for those answers.”
“What does the customer value? may be the most important question. Yet it is the one least often asked. Nonprofit leaders tend to answer it for themselves. ‘It’s the quality of our programs. It’s the way we improve the community.’ People are so convinced they are doing the right things and so committed to their cause that they come to see the institution as an end in itself. But that’s a bureaucracy. Instead of asking, ‘Does it deliver value to our customers?’ they ask, ‘Does it fit our rules?’ And that not lonely inhibits performance but also destroys vision and dedication.”
As an or musician, one of the most important skills to develop is that of listening. We encourage students in our music school in Odessa, Texas not only to listen, in a musical sense, but also to become acutely aware of the musical values of their audience. What does the audience value?
“Your knowledge of what primary customers value is of utmost importance. Yet the reality is, unless you understand equally what supporting customers value, you will not be able to put all the necessary pieces in place for the organization to perform…To formulate a successful plan you will need to understand each of your constituencies’ concerns, especially what they consider results in the long term. Integrating what customers value into the institution’s plan is almost an architectural process, a structural process.”
“Yesterday, customers needed to go into a store for help. Yesterday, customers needed to do it at the time the company said (9AM to 5PM) and at their own expense. Today, customers expect to be helped at the time when they want to be helped and on their terms. Companies that get this are already reaching new heights and many are revolutionizing their industries.”
“What we are witnessing is the rapid convergence of sales, service, and marketing. Every interaction with a customer is now marketing. Marketing was once focused on the destination- and that destination was most likely a purchase. Marketing is now about the customer journey, and customers expect you to be there to help them every step of the way- before, during, and after the purchase. We buy products because they help us in some way. We now expect that help is delivered on our terms.”
“We are in a moment of unprecedented consumer engagement tools. But the tolls themselves are nothing more and nothing less than how we use them. Ignore them, and you’re missing a tremendous opportunity. Exalt them too much, though- relying solely on whatever insight they provide- and you’ll likely see only the barest contours of your customer’s wants, needs, and frustrations.”
What Are Our Results?
“To further the mission, each nonprofit needs to determine what should be appraised and judged, then concentrate resources for results.”
“In business, you can debate whether profit is really an adequate measuring stick but without it, there is no business in the long term. In the social sector, not such universal standard for success exists. Each organization must identify its customers, learn what they value, develop meaningful measures, and honestly judge whether, in fact, lives are being changed.”
Qualitative and Quantitative Measures:
“Qualitative measures address the depth and breadth of change within its particular context. They begin with specific observations, build toward patters, and tell a subtle, individualized story. Qualitative appraisal offers valid, ‘rich’ data…although sometimes more subjective and difficult to grasp, are just as real, just as important, and can be gathered just as systematically as the quantitative.”
“Quantitative measures use definitive standards. They begin with categories and expectations and tell an objective story. Quantitative appraisal offers valid ‘hard’ data…Quantitative measures are essential for assessing whether resources are properly concentrated for results, whether progress is being made, whether lives and communities are changing for the better.”
“We must sail between two shoals…on one hand, we must ensure that our plans are designed in such a way that results are measurable…on the other hand, we must also avoid the other shoal- the temptation to undertake only that work most easily quantified, to choose the sort of task that produces outputs but fails to alter the most important outcomes. In this way, to pursue the metaphor just one phrase further, out voyage is an artistic and not just scientific endeavor.”
“Values are designed to serve as individuals and organizations’ ‘true north.’ It is a rare organization that has not taken the time to establish some set of formal values. Yet, all too often organizations do not examine their actions through the leans such espoused statements of beliefs and principles provide…Leaders and organizations are entrusted with influencing people’s lives. Long-term vitality for each of the aforementioned groups is contingent upon delivering the right results at the right time. Results matter! However, how one generates results also matters.”
In our music school in Odessa, Texas we strive to measure the student’s progress both qualitatively as well as quantitatively. Holding basic competencies as a standard, we are able to help students reach their potential against these benchmarks.
What Is Our Plan?
“The self-assessment process leads to a plan that is a concise summation of the organization’s purpose and future direction. The plan encompasses mission, vision, goals, objectives, action steps, a budget, and appraisal…every mission statement has to reflect three things: opportunities, competence, and commitment. It answers the questions, What is our purpose? Why do we do what we do? What, in the end, do we want to be remembered for?”
The circle is: Mission — Goals — Objectives — Action Steps —Budget — Appraisal
“Planning does not substitute facts for judgment, nor science for leadership. It recognizes the importance of analysis, courage, experience, intuition- even hunch. It is responsibility rather than technique.”
“Goal are overarching and should be few in number. If you have more than five goals, you have none. You’re simply spreading yourself too thin…Goals flow from mission, aim the organization where it must go, build on strength, address opportunity, and taken together, outline your desired future.”
Management must ask, ‘Is an objective leading us toward our basic long-range goal, or is it going to sidetrack us, divert us, make us lose sight of our aims?’ St. Augustine said, ‘One prays for miracles but works for results.’ Your plan leads you to work for results. It converts intentions into action.”
Developing successful musicians and artists takes years of training, and is a long-range prospect. At our music school in Odessa, Texas we help students see the big picture and ‘play the long game.’
Five elements of plans:
- Abandonment: The first decision is whether to abandon what does not work, what has never worked- the things that have outlived their usefulness and their capacity to contribute. Ask, ‘If we were not committed to this today, would we go into it?’ If the answer is no, say ‘How can we get out- fast?’
- Concentration: Concentration is building on success, strengthening what does work. The best rule is to put your efforts into your successes…Concentration is vital, but it’s also very risky. You must choose the right concentrations.
- Innovation: You must also look for tomorrow’s success, the true innovations, the diversity that stirs the imagination. What are the opportunities, the new conditions, the emerging issues? Do they fir you? Do you really believe in this? But you have to be careful. Before going into something new, don’t say, ‘This is how we do it.’ Say, ‘Let’s find out what this requires. What does the customer value? What is the state of the art? How can we make a difference/” Finding answers to these questions is essential.
- Risk Taking: Planning always involves decisions on where to take the risks. Some risks you can afford to take- if something goes wrong, it is easily reversible with minor damage. And some decisions may carry great risk, but you cannot afford not to take it. You have to balance the short range with the long.
- Analysis: Finally, in planning it is important to recognize when you do not know, when you are not yet sure whether to abandon, concentrate, fo into something new, or take a particular risk. Then you r objective is to conduct an analysis. Before making the final decision, you study a weak but essential performance area, a challenge on the horizon, the opportunity just beginning to take shape.
“True self-assessment is never finished. Leadership requires constant re-sharpening, refocusing, never really being satisfied. I encourage you especially to keep asking the question, What do we want to be remembered for? It is a question that induces you to renew yourself.”
The value of having a teacher and mentor cannot be overstated. In our music school in Odessa, Texas we take seriously the responsibility of raising up a new generation of artists and musicians. The first step towards a successful path forward is honest assessment on all levels.
“As a leader, the most important thing you can do is articulate a vision. Dong so convenes people smarter, more experienced, and better than you in every way…You cannot translate a vision without a clear plan, for that is the tangible matter that people can wrap their arms around once you have successfully inspired them to join forces with you. The clearer your plan, the lesser the lass factor between the people you inspire and those who decide to commit, and the lesser the loss factor between the people who decide to commit and the actions they perform in moving toward your shared goal. Keep that pipeline of vision translation lead-free- your most powerful sealant is your plan.” (Carloline Ghosn)
According to Frances Hesselbein, organizations usually pass eight milestones to reach their destination: an inspired, relevant, viable, effective organization:
- Scan the environment. Through reading, surveys, interviews, and son on, we identify the major trends likely to affect the organization. The essence of strategy is to define the implications of those trends.
- Revisit the mission. We review our mission every three years and refine it if necessary.
- Ban the hierarchy. Transformation requires moving people out of their old organizational boxes into flexible, fluid management systems. We cannot continue to put people into little spares on the structure chart…We prefer circles- concentric circles of functions and positions.
- Challenge the gospel. There should be no sacred cows as we challenge every policy, practice, procedure, and assumption. In transforming themselves, organizations must practice planned abandonment.
- Employ the power of language. Leaders must beam a few clear, consistent messages over and over.
- Disperse leadership across the organization. Every organization must have not one but many leaders. Some speak of empowerment, others of sharing the tasks of leadership. I think of it as dispersing leadership- with leaders developing and performing across every level of the organization.
- Lead from the front; don’t push from the rear. The leader of the future does not sit on the fence, waiting to see which way the wind is blowing. The leader articulates clear positions on issues affection the organization and is the embodiment of the enterprise, its mission, its values, and its principles. Leaders model desired behaviors, they never break a promise, and they know that leadership is a matter of how to be, not how to do.
- Assess performance. Self-assessment is essential to progress.
According to Lauren Maillian Bias, a Millennial Takeaway is as follows,
“Organizations aren’t hiring candidates only for the skills listed on their resume. Someone might be highly skilled but also unfocused, unsure of the solid moral compass, untrustworthy, and unreliable. Every day of the week employers will choose to hire, collaborate, or partner with someone they can trust, someone reliable, someone who is intelligent and adaptive, who can roll with the punches, and who is willing and able to learn whatever it is he or she needs to know to effectively do the job.”
In our music school in Odessa, Texas we place an emphasis on the comprehensive development of the student, not only of talent, but also (and most importantly) character.
The principles laid out in this book are all good, provided the community in which one serves has its own moral compass. However, by way of critique: asking the question, “What does the customer want?” can lead to prostitution. Probably a simpler way of looking at the entire subject would be to boil it down to a single relationship between two people. In a conversation, one should first be a good listener, and in contributing to the conversation, should not ‘domineer’ the interaction, but should also have something of value to say, and also able to ‘hold his ground’ when challenged. ‘Listening’ to our culture doesn’t mean ‘giving way’ to our culture. At some point leadership must also challenge the culture to a newer and better place. If the ‘customer is always right,’ then there is nowhere else to go, and hence, no leadership necessary.