The Five Most Important Questions – Peter Drucker

Peter Drucker is by far the most important management thinker of the 20th century. Even in 2010, his thinking and guidance is highly effective and has lost little of its lustre and value.

The Five Most Important Questions

Drucker formulated five “Most Important” questions to ask an organization. Each of them have subquestions which result. It is the answering of the questions together as a team which builds not only consensus but a shared understanding of what needs to be done.

  • What is our Mission?
  • Who is our Customer?
  • What does our Customer Value?
  • What are our Results?
  • What is our Plan?

What is our Mission?

  • Missions Are About Changing Lives
  • It Should Fit On A T-Shirt
  • Make Principled Decisions
  • Keep Thinking It Through

Questions about the Mission

  • What are we trying to achieve?
  • What are the significant external or internal challenges, opportunities, and issues?
  • Does our mission need to be revisited?

Who is our Customer?

  • Identify The Primary Customer
  • Identifying Supporting Customers
  • Know Your Customers

Questions about the Customer

  • Who are our customers?
  • Have our customers changed?
  • Should we add or delete some customers?

What does the Customer Value?

  • Understand Your Assumptions
  • What Does The Primary Customer Value?
  • What Do Supporting Customers Value?
  • Listen To Your Customers

Questions about What the Customer Values

  • What do our customers value?

What are our Results?

  • Look At Short-Term Accomplishments And Long-Term Change
  • Qualitative And Quantitative Measures
    • Qualitative measures
    • Quantitative measures
  • Assess What Must Be Strengthened Or Abandoned
  • Leadership Is Accountable

Questions about the Results

  • How do we define results for our organization?
  • To what extent have we achieved these results?
  • How well are we using our resources?

What is our Plan?

  • Goals Are Few, Overarching, And Approved By The Board
  • Objectives Are Measurable, Concrete, And The Responsibility Of Management
  • Five Elements Of Effective Plans
    • Abandonment
    • Concentration
    • Innovation
    • Risk taking
    • Analysis
  • Build Understanding And Ownership
  • Never Really Be Satisfied

Questions about the Plan

  • What have we learned, and what do we recommend?
  • Where should we focus our efforts?
  • What, if anything, should we do differently?
  • What is our plan to achieve results for the organization?
  • What is my plan to achieve results for my group or responsibility area?

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Sakichi Toyoda and the Five Whys Root Cause Analysis

Sakichi Toyoda and the Five Whys

Sakichi Toyoda, the founder of Toyota Motor Company, is considered one of the greatest if not the greatest inventor of Japan and the father of Japanese Industrialization. His impact on the world should not be underestimated. As with most historical figures, our tasks are different because we live in a different world. However we can learn from the thinking of this great man.

Toyoda invented the Five Whys question asking method for discovering the root cause of events, particularly failure. The idea is to get at root causes rather than symptoms so that improvements rather than merely temporary fixes can be made to a system.

Root Cause Discovery is Difficult

Getting at root causes is not easy, and the method is not foolproof, but it is a profound and useful tool. Root cause analysis is a fundamental feature of innovative systems otherwise the changes to the system will be cosmetic, or worse will cause the system to further degrade.

Example of Root Cause 5 Whys Analysis

My car will not start. (the problem)

  1. Why? – The battery is dead. (first why)
  2. Why? – The alternator is not functioning. (second why)
  3. Why? – The alternator belt has broken. (third why)
  4. Why? – The alternator belt was well beyond its useful service life and has never been replaced. (fourth why)
  5. Why? – I have not been maintaining my car according to the recommended service schedule. (fifth why, a root cause)

The Five Whys at Lanna Innovation

At Lanna Innovation, we also ask the five whys, but not only in events of failure in terms of production, but failure in terms of a clash of understandings and in disagreements. Why do we disagree? What is the failure of perception or the failure of conception taking place? Understanding root causes is key to communication and product development processes as well as engineering quality control.

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Lanna Innovation Online Store – Now Open

Lanna Innovation Co., Ltd. is pleased to announce that it’s online store is now open and we are shipping the first product, the innovative Thai Alphabet consonants flash cards.

Thai Alphabet - Consonants Flash Cards

We want to thank everyone who made this possible, including first of all Khun Pattara the mastermind behind this product, as well as everyone else who had a role, including Eak at Modernhead, Keng at Bangbai Design, Keng and Kongfha at Santipab and yours truly.

Jeff McNeill, co-founder
Lanna Innovation Co., Ltd.
January 10, 2010

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