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If you ask managers what they do, they will most likely tell you that they plan, organize, coordinate and control. Then watch what they do. Don't be surprised if you can't relate what you see to those four words.

If we face a recession, we should not lay off employees; the company should sacrifice a profit. It's management's risk and management's responsibility. Employees are not guilty; why should they suffer?

What is the first duty--and continuing responsibility--of the business manager? To strive for the best possible economic results from the resources currently employed or available.

The task of management is not to apply a formula but to decide issues on a case-by-case basis. No fixed, inflexible rule can ever be substituted for the exercise of sound business judgement in the decision-making process.

Top executives should rate their subordinates on loyalty and competence. Those who are more loyal than competent should be fired because they are the dangerous ones. They will stay forever while other more competent, less loyal people will jump ship as problems develop. And the loyal, noncompetent subordinates will "protect" their bosses from the truth. Reality will be too threatening and ugly. When truth dies, really bad things happen.

Organizations that that want the benefits of effective followers must find ways of rewarding them, ways of bringing them into full partnership in the enterprise. Think of the thousands of companies that achieve adequate performance and lackluster profits with employees they treat as second-class citizens. Then imagine for a moment the power of an organization blessed with fully engaged, fully energized, fully appreciated followers.

Visionaries make good things happen. Managers keep bad things from happening. For your company to be successful, you need both. Unfortunately, you rarely find them in a single person.

No institution can possibly survive if it needs geniuses or supermen to manage it. It must be organized in such a way as to be able to get along under leadership composed of average human beings.

Organizational effectiveness is "the ability of an organization to fulfill its mission through a blend of sound management, strong governance, and a persistent rededication to achieving results."

Find a wide selection of interviews with business luminaries in our Interviews Section

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Take away my people, but leave my factories, and soon grass will grow on the factory floors. Take away my factories, but leave my people, and soon we will have a new and better factory.

Management, in the sense of the employer, is merely the agent for the public, the stockholders and the employees. It is management's job to preserve the balance fairly between all of these interests, that each may have his fair share without imperilling the continuity of the effort upon which the whole depends.

Leadership is an army you have to enlist in. You can't get drafted into leadership. You can get drafted into management.

Until customers of measures and owners of measures get together, what gets measured doesn't necessarily get managed...What gets rewarded gets managed.

When governance has the texture of service it calls for a like response from those governed.

A firm needs four resources in order to compete: physical, organizational, human and process.

Insecure managers create complexity. Frightened, nervous managers use thick, convoluted planning books and busy slides filled with everything they've known since childhood. Real leaders don't need clutter. People must have the self-confidence to be clear, precise, to be sure that every person in their organization understands what the business is trying to achieve. But it's not easy. You can't believe how hard it is for people to be simple, how much they fear being simple. They worry that if they're simple, people will think they're simple-minded. In reality, of course, it's just the reverse. Clear, tough minded people are the most simple.

There is nothing worse than taking a long time to make a bad decision!

The wrong answer is the right answer in search of a different question.

I sit on a man's back, choking him and making him carry me, and yet assure myself and others that I am very sorry for him and wish to ease his lot by all possible means-except by getting off his back.

The big companies that get into trouble are those that try to manage their size instead of experiment with it.

Managers do things right. Leaders do the right thing.

When responsible action, the natural love of learning, and the desire to do good work are already part of who we are, then the tacit assumption to the contrary can be fairly described as dehumanizing.

Three classes of factors affect what an organization can and cannot do: its resources, its processes, and its values.

Despite beliefs spawned by change-management and reengineering programs, processes are not nearly as flexible as resources are -- and values are even less so.

Find a wide selection of interviews with business luminaries in our Interviews Section

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We got it right when we said that we were in search of excellence. Not competitive advantage. Not economic growth. Not market dominance or strategic differentiation. Not maximized shareholder value. Excellence...Search of Excellence -- even the title -- is a reminder that business isn't dry, dreary, boring, or by the numbers.

I think control systems are one of the most important, least understood, and least examined aspects of management that we have today. Most companies tend to accrete their control systems, whether on the financial, production, or sales side. So over time you get hundreds of these systems. If you ask companies how many control systems they have, they don't know. If you ask them how much they're spending on control, they say, "We don't add it up like that." If you ask them to rank their control systems from most to least cost-effective, then cut out the 20 percent at the bottom, they can't.

Our most basic choice, the one that grounds all the others, is this: Do we attend closely to the business of our choices, or do we flee from them, in arrogance, or fear, or boredom--or some combination of all three?

There are two - and only two - kinds of variables in a system dynamics model: levels (or accumulations) and rates (or actions). Once you believe that there are only two kinds of concepts in a system, everything you look at has to be one or the other.

The existence of only two kinds of variables - levels and rates - is true of all systems. Levels - that is, things like number of employees, reputation of the firm, degree of trust within a group, and quality of products - state the condition to which a system has arrived at any point in time. They are gradually built up or degraded over time by streams of actions. Rates, by contrast, are controlled by the system policies that describe how decisions result from system levels.

Business leaders make impassioned speeches about the advantages of a free-enterprise economic system while running some of the largest socialist bureaucracies in the world. They have central planning, central ownership of capital, central allocation of resources, subjective evaluation of people, lack of internal competition, and decisions made at the top in response to internal political pressures. These are the fundamental characteristics of a socialist economy. The speeches by corporate executives are right; their practices are not.

The problem with the Balanced Scorecard is it doesn't give you an actual score of how your company is doing. For instance, if you were playing basketball, the Balanced Scorecard could tell you the number of rebounds, turnovers, blocked shots and a lot of other statistics about the game, all of which help to some extent, but it couldn't tell you the score. EVA provides that score.