Case ID: 94506     Solution ID: 34475

Theory of the Business Case Solution


In his thirty-first article for HBR, Peter F. Drucker contends that what underlies the present disquietude of such a large number of expansive and fruitful associations worldwide is that their hypothesis of the business no more works. The story is a well known one: an organization that was a genius just yesterday discovers itself stagnating and disappointed, into a bad situation and, frequently, in an apparently unmanageable emergency. The main driver of almost every one of these emergencies is not that things are being done ineffectively. It is not even that the wrong things are being finished. In reality, much of the time, the right things are being done- - however vainly. What represents this obvious conundrum? The presumptions on which the association has been manufactured and is being run no more fit reality. These are the suspicions that shape any association's conduct, manage its choices about what to do and what not to do, and characterize what an association considers important results. These suppositions are what Drucker calls an organization's hypothesis of the business.

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