Any business enterprise must build a true team and weld individual efforts into a common effort. Each member of the enterprise contributes something different, but they must all contribute toward a common goal. Their efforts must all pull in the same direction, and their contributions must fit together to produce a whole without gaps, without friction, and without unnecessary duplication of effort.
Business performance therefore requires that each job be directed towards the objectives of the whole business. And in particular each managerâ€™s job must be focused on the success of the whole. The performance that is expected of the manager must be derived from the performance goals of the business, his results must be measured by the contribution they make to the success of the enterprise. The manager must know and understand what the business goals demand of him in terms of performance and his superior must know what contribution to demand and expect of him and must judge him accordingly. If these requirements are not met managers are misdirected. Their efforts are wasted. Instead of team work, there is friction, frustration and conflict.
Management by objectives requires major effort and special instruments. In the business enterprise managers are automatically directed toward a common goal. On the contrary, business by its very nature contains three powerful factors of misdirection: in the specialized work of most managers; in the hierarchical structure of management; and in the differences in vision and work and the resultant insulation of various levels of management.
A favorite story at management meetings is that of the three stonecutters who were asked what they were doing. The first replied: â€œI am making a livingâ€. The second kept on hammering while he said: I am doing the best job of stonecutting in the entire county. The third one looked up with a visionary gleam in his eyes and said: I am building a cathedral.
The third man is, of course, the true â€œmanagerâ€. The first man knows what he wants to get out of the work and manages to do so. He is likely to give a â€œfair dayâ€™s work for a fair dayâ€™s pay.â€ But he is not a manager and will never be one.
It is the second man who is a problem. Workmanship is essential; without it no work can flourish; In fact, an organization demoralizes if it does not demand of its members the most scrupulous workmanship they are capable of. But there is always a danger that the true professional, will believe that he is accomplishing something when in effect he is just polishing stones or collecting footnotes. Workmanship must be encouraged in the business enterprise. But it must always be related to the needs of the whole.
The majority of managers in any business enterprise are, like the second man, concerned with specialized work. True, the number of functional managers should always be kept at a minimum, and there should be the largest possible number of â€œgeneralâ€ managers who manage an integrated business and are directly responsible for its performance and results. Even with the utmost application of this principle the great bulk of managers will remain in functional jobs. This is particularly true of the younger people.
A manâ€™s habits as a manager, his vision and his values, therefore, will as a rule be formed while he does functional and specialized work. It is essential that the functional specialist develop high standards of workmanship that he strives to be â€œthe best stonecutterâ€ in the country. For work without high standards is dishonest. It corrupts the man himself. It corrupts those under him. Emphasis on, and drive for, workmanship produces innovations and advances in every area of management. Managers strive to do â€œprofessional personnel management to run â€œthe most up-to-date plant.â€ To do â€œtruly scientific market research,â€ to â€œput in the most modern accounting system,â€ or to do â€œperfect engineeringâ€ must be encouraged.