Peter Drucker was, by most accounts, the greatest business thinker of the 20th century. His insights on leadership, time management, and building healthy organizations have influenced a generation of executives worldwide. I’ve spent some time this year re-reading Drucker, and I’ve come to realize something. His philosophy is particularly useful as part of the professional development for nonprofit leaders. His simple wisdom has the ability to dramatically increase the efficiency and the total impact of nonprofits.
Jim Collins—author of Good to Great and several other classic business books—spent a lot of time with Peter Drucker before his death in 2005. In his forward to Drucker’s classic work, The Effective Executive, Collins boils down several principles gleaned from the book. “Anyone who has responsibility for getting the right things done—anyone who seeks how best to self-deploy on the few priorities that will make the biggest impact—is an executive,” notes Collins. Nonprofit professionals fit squarely within that definition. For this reason, Drucker’s advice should be a key component in nonprofit leadership development.
Collin’s most powerful point relates to Drucker’s belief about why organizations exist. And more fundamentally, why we work. During their conversation, Drucker tells Collins that the fundamental question for any organization should be: “How can we make society both more productive and more humane?” Of course, this basic point should be the mantra of every nonprofit. It supposes that there is a core relationship between efficiency and human impact that should exist in every organization.
In a conversation at Peter Drucker’s home, he takes this concept even further with a simple but profound statement. “It seems to me you spend a lot of time worrying about how you will survive,” he tells Collins. “You will probably survive. And you seem to spend a lot of energy on the question of how to be successful. But that is the wrong question.” Drucker pauses for effect, and then says, “The question is: how to be useful!”
In the nonprofit space we see far too many leaders who are focused on being successful. They strive to make sure that they hit their budget, keep their team employed, or hit a set of vanity metrics. All this does is attempt to demonstrate that their organization is succeeding. But Drucker is less concerned with these values. This manner of pursuing success will always be short lived and shortsighted. Real impact comes when organizations are able to focus their energy on being “useful”.
“Usefulness” seems like a mundane concept, and it certainly doesn’t provide a flashy headline for fundraising emails. But as a matter of fact, this usefulness is the heart of what we value about nonprofits: their impact on the world. Being “useful” implies that nonprofits are relentlessly focused on solving problems that actually help their constituency. They constantly measure, interview, and research their practices to ensure the real people are actually being served in meaningful ways.
Nonprofits pursue efficiency in order to increase impact, and they are fearless in changing or eliminating under performing programs that aren’t measurably helping humanity. Vanity metrics—and even the jobs of those at their organization—take a backseat to the actual utility of their work on the ground. The legacy of their organization or their perceived success in the eyes of donors are constantly sacrificed at the feet of effectiveness.
In the short run, this approach is both risky and humbling. But over the long run it produces more healthy organizations, more inspired employees and, ultimately greater impact.
If you would like to continue to grow your nonprofit leadership skills, I highly recommend the 50th Anniversary Edition of Drucker’s The Effective Executive, which includes Collin’s introduction. In addition, I’ve written about how nonprofits can adopt Lean Startup practices as a way to quickly innovate and move to more productive and useful work.
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