32. Peter Drucker in his own words interpreted for small business 4

“Management is mostly to do with people, not procedures”. Those of you who have been following this series will have read about Frederick Winslow Taylor and his Scientific Management work. His mechanistic approach to efficiency (which focused on what is the most effective set of physical actions to complete a physical process) ignored the fact that it was people and not just machines that completed the tasks.

Drucker is much more people focused and realised that motivation and attitude are overall of greater significance than other factors. Of course, in large corporations, this poses very great problems of organisation, communication and business politics. But is it that much less significant for the small business?

There are four areas where this quote is relevant for the small business:

1. The customer or client. You have to manage your relationship with them. Even if your business is entirely web-based and your procedures provide a seamless service for customers, they are still people and will want an interface that ‘feels’ friendly and, if they have any problems, to be treated as human beings. So how much more for a business that is face-to-face? Just apply the Christian message: Do unto others as you would be done unto” and you should not go too far wrong.

2. The supplier. Another set of relationships you have to manage, and, as the small business usually has only very limited power over its suppliers and is often very dependent on them, one that requires a lot of care and attention but is often taken for granted. But when a problem arises and you need your suppliers’ help, these relationships can make all the difference.

3. Your staff. Obviously the relationship we think of most often when we think of management. A small business is usually dependent on very few people. So what will make the difference to their performance? It will of course vary by person and business, but understanding of and involvement in the business’s aims and objectives, its vision and standards and even in how it is run will usually help. Procedures are important, but it will finally be the people that make the difference – and indeed with the right motivation they may help change the procedures for the better (see the Toyota example referred to in a previous item in this series, where thousands of changes proposed by staff are implemented every year).

4. Yourself. This is one person that it is sometimes easy to overlook – or not to understand well enough. Yet you have to manage yourself as well as all the other stakeholders. Is this really necessary? Well, certainly in my experience as a business advisor I often see people pursuing businesses which are not taking their lives in the direction that they say they want to go, or who are failing to see their weaknesses and equally often failing to appreciate rheir strengths. So some conscious thought on self-analysis and what you need to do and to delegate to get the most out of your personal resources – your abilities, knowledge and time – can be time very well spent. It will help you be effective, as well as efficient.