The Big Idea: The Late, Great Peter F. Drucker

Peninsula Team

September 10 2010

It takes something fairly special to be described by BusinessWeek as “The Man Who Invented Management”. But back in November 2005, a couple of weeks after his death at the grand old age of 95, that was the cover story accolade given to a man named Peter F. Drucker. Drucker was born in Austria in 1909 and grew up in an intensely educated and elitist hub of professionals and academics. Intellectuals, artists, government officials and scientists would meet at his parents’ house. As a child he even met Sigmund Freud. Although himself not Jewish, Drucker wrote articles on the situation in Germany which offended the Nazis so much that they were banned and burned. The few copies remaining in library archives today are marked with the swastika. Drucker left Germany when Hitler became Chancellor and moved to London, ultimately settling in America in 1937. The oppression of Nazism and the danger of centralised power remained central to his thinking on business and his work on management. So why is he so seminal in management thinking to this day? His experiences in Europe left him fascinated with the question of authority. He latched on early to the concept of decentralisation in organisations, particularly through his work with General Motors, passing power out from management to engage and harness the energy of the workers in a company. He believed that management is a “liberal art”. What did he mean by that? Among other things, he felt workers should be treated as assets rather than liabilities. Nothing new in that, perhaps? But remember, it was during the 1950s when he first expressed that view. Similarly, back in the fifties, he also appreciated that: “The purpose of business is to create and keep a customer.” This heralded the focus on sales, marketing and customer service that is now a standard part of most business operations, from an SME to a multi-national conglomerate. He also believed that all institutions had a responsibility to the whole of society and should be built on trust for the worker – forty years before even the most enlightened corporations latched onto corporate and social responsibility as a “must do”. In the 1970s, Drucker expressed the view that the knowledge that workers could bring to a company would add more value than simply focusing on processing raw materials – again, many years before the phrase “knowledge-based economy” became standard for us all. He was always ahead of the curve, predicting trends decades before they happened. So how can the thinking of this late, great management guru help us? Probably only through the power of his own I’ve listed some two of the quotations from Drucker that most resonate with me. Perhaps they will strike a chord with you, too, when running your business and managing your people. (link to “The Essential Peter Drucker” book). “The leaders who work most effectively, it seems to me, never say I. And thats not because they have trained themselves not to say I. They dont think I. They think we; they think team. They understand their job to be to make the team function. They accept responsibility and dont sidestep it, but we gets the credit.... This is what creates trust, what enables you to get the task done.” “The entrepreneur always searches for change, responds to it, and exploits it as an opportunity.” Deborah Done, the author of our Big Ideas, is founder and director of Nab Communications, a freelance public relations agency which provides sensible and value for money PR advice to regional and national businesses.

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