Wednesday, December 03, 2008

Know Thy Time by Peter Drucker

I received an email from a friend that included a section from the classic Peter Drucker book, "The Effective Executive" which has a chapter called, "Know Thy Time".

Time is also a unique resource. Of the other major resources, money is actually quite plentiful. We long ago should have learned that it is the demand for capital, rather than the supply thereof, which sets the limit to economic growth and activity. People -- the third limiting resources -- one can hire, though one can rarely hire enough good people. But one cannot rent, hire, buy, or otherwise obtain more time.

The supply of time is totally inelastic. No matter how high the demand, the supply will not go up. There is no price for it and no marginal utility curve for it. Moreover, time is totally perishable and cannot be stored. Yesterday's time is gone forever and will never come back. Time is, therefore always in exceedingly short supply.

Time is totally irreplaceable. Within limits we can substitute one resource for another, copper for aluminum, for instance. We can substitute capital for human labor. We can use more knowledge or more brawn. But there is no substitute for time.

Everything requires time. It is the only truly universal condition. All work takes place in time and uses up time. Yet most people take for granted this unique irreplaceable, and necessary resource. Nothing else, perhaps distinguishes effective executives as much as their tender loving care of time.

Man is ill-equipped to manage his time.

And another friend emailed me a great link at Economist's view on the need for reliable information and how that is partly what is causing the current economic uncertainty.


At 11:45 AM, Anonymous Anonymous said...

A great thinker, and oh so true.

I have stated before that senior managers at too many companies are familiar with the time value of money, yet seem ignorant of the money value of time.

In economic times like this, hours of that inelastic resource are lost through inefficient execution, poor planning, inappropriate process management, and poor communication.

Thanks for the reminder!



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