Peter Drucker was many things to many people and to many organizations. He was, of course, considered the Father of Modern Management. He was a philosopher and an author and a profoundly thoughtful observer. He was a historian, and a father, and a husband, and an expert on Japanese art. Peter called himself a social ecologist, and he exercised courage in thought and prescription. Peter believed deeply that the human condition could be advanced by more effective management and more ethical leadership of every organization in every society—business, government, the non profit world, even the academy, where he resided most of his life. This is what he taught and wrote about, and Peter wrote some more than 30 books, many of them now classics. He inspired many others to pursue their own work. Think of Tom Peters (In Search of Excellence). Or Jim Collins (Built to Last and Good to Great), who says that either or both of his volumes could have been entitled simply: Peter was Right!
Peter’s insights and friendship through mentoring and coaching helped to transform entire organizations. Think of GE under Jack Welch. Or the development of the mega church in America under disciples such as Rick Warren. And, of course, Peter helped to inspire a whole generation of leaders in the non profit sector, whose role and importance and needs Peter was perhaps the first to identify and champion as worthy of management attention.
For all his distinctions and contributions, Peter was first and foremost a teacher. Fame never distracted him from his calling in the classroom, and his lectures were the stuff of legend: Seemingly unscripted, frequently unpredictable, and almost always provocative and original. The classroom was Peter’s cathedral. And this is where he regularly practiced his craft of both instruction and learning. Classically trained, broad and deep in range and scope of intellect and knowledge, Peter held forth, almost as a secular prophet. And yet his ultimate humility and humanity was also demonstrated by his conviction that from his students he had much to learn from as well. Teaching was really a partnership for Peter, and an almost sacred trust between teacher and students, where knowledge was not only disseminated but also created. The classroom, then, was really Peter’s first and last frontier of management, the ultimate knowledge-creating organization, a microcosm and laboratory for so many of his insights about human capital, purpose, objectives, innovation, and so much more. Bill Cohen brings that laboratory of learning alive to those of us who didn’t have the pleasure, privilege, or opportunity to sit at the feet of the master in Peter’s classroom. One can feel the energy, the humour, the discipline, the interaction, the edge, the energy, the simplicity, and the relevance of Peter’s practice of teaching.
Peter Drucker, who died in 2006 at the age of 97, was a living legend, one of the world's most respected thinkers on management and society. His thinking inspired many business leaders from around the world, as well as in the non profit sector, while influencing companies both large and small. Over six decades, as a journalist, teacher, consultant, and author of more than thirty-five books from his publishers Harper Collins, Drucker made management theory a respected discipline. He had a brimming lifetime of wisdom to share and expertise that reached well beyond the confines of the world’s largest companies.
Drucker was born in Vienna in 1909. He studied law in Germany, then moved to England to escape Nazism and later to the United States. In 1945, his book Concept of the Corporation, based on a two-year study of General Motors, became an instant best-seller. Beginning in 1971, he taught management at Claremont Graduate University in California, which in 1987 named its school of management after him. He was the ultimate guru to generations of executives and students of management theory. Here is a brief anthology of Drucker´s thoughts on how organizations succeed and why they may fail.
Some of Peter Drucker views
Results exist only on the outside
“The single most important thing to remember about any enterprise is that results exist only on the outside. The results of a business are satisfied customers. The result of a hospital is a healed patient. The result of a school is a student who has learned something and puts it to work ten years later. Inside an enterprise, there are only costs.”
Untapped human potential
“Managers are fond of saying ‘Our greatest asset is people.‘ They are fond of repeating the truism that the only real difference between one organization and another is the performance of people. All other resources one organization commands to exactly the same extent as does any other. And most managers know perfectly well that of all the resources, people are the least utilized and that little of the human potential of any organization is tapped and put to work constructively.“
Two missing elements
“Two of the missing elements in most management procedures are first, that the manager hasn’t been asked what information he needs to be able to do the job he has committed himself to, and second, he hasn’t been asked what information he needs in order to know how well he’s doing it.
Hence, people bitterly complain that they would like to manage themselves by objectives, but they can’t. Most of the time the answers to both questions could be written on the back of an envelope. There are very few answers in life that can’t be written on the back of an envelope.”
What is our Business?
“That business purpose and business mission are so rarely given adequate thought is perhaps the most important single cause of business frustration and business failure. Conversely, in outstanding businesses, success always rests to a large extent on raising the question ‘What is our business?’ clearly and deliberatively, and on answering it thoughtfully and thoroughly.
But there is also a need to ask ‘What should our business be?’ What opportunities are opening up or can be created to fulfil the purpose and mission of the business by making it into a different business?
Management is doing things right; leadership is doing the right things.
Business Strategies for Tomorrow
“Any institution needs to think strategically about what its business is doing and what it should be doing. It needs to think through what its customers pay it for. Every institution needs to think through what its strengths are. Are they the right strengths for its specific business? Are they deployed where they will produce results? And what specifically is the market for this particular business, both at the present time and in the years immediately ahead.”
“Most businesses and public service institutions believe it is possible to be a ‘leader’ in every area. But strengths are always specific, always unique. One gets paid only for strengths, one does not get paid for weaknesses. The question, therefore, is first: “What are our specific strengths?” And then: “Are they the right strengths?”
(From: Managing in Turbulent Times)
On Setting Priorities
“No business can do everything. Even if it has the money, it will never have enough good people. It has to set priorities. The worst thing is to try to do a little bit of everything. This ensures that nothing is being accomplished. It is better to pick the wrong priority than none at all, and, courage rather than analysis dictates the truly important role for identifying priorities:
Aim to:
· Pick the future as against the past.
· Focus on opportunity rather than on problems.
· Choose your own direction rather than climb on the bandwagon; and
· Aim high, aim for something that will make a difference, rather than for something that is ‘safe’ and easy to do.”
(From: The Effective Executive)
On Risk
“Of course, innovation is risky. But so is stepping into the car to drive to the supermarket for a loaf of bread. All economic activity is by definition high risk. And defending yesterday – that is, not innovating – is far more risky than making tomorrow.”
From: Innovation and Entrepreneurship
No Apology needed
“No apology is needed for profit as a necessity of economy and society. On the contrary, what a businessman should feel guilty about, what he should feel the need to apologize for, is failure to produce a profit appropriate to the economic and social functions which profit, and only profit, can develop.”
From: Management
Lifelong Learning
“The innovative organization requires a learning atmosphere throughout the entire business. It creates and maintains continuous learning. No one is allowed to consider himself ‘finished’ at any time. Learning is a continuous process for all members of the organization.”
Entrepreneurship
“Whenever you see a successful business, someone once made a courageous decision.”
Four key competencies associated with leadership
Drucker identifies four key competencies associated with leadership. They are:
· A willingness to listen.
· A willingness to communicate.
· A willingness not to alibi yourself.
· A willingness to realize how unimportant you are compared to the task.
(Source: Leadership: Project and Human Capital Management)
If You Keep Doing What Worked in the Past, You’re Going to Fail
Continuing what led to past success will invariably lead to eventual future failure. If caught unawares, organizations must be willing to instantly abandon what was formerly successful. Better yet, an organization should assume an eventual revolutionary change is inevitable. Therefore, an organization should take actions to create its own future by making the revolutionary change itself, even though it means obsolescing the products or methods of its current and past success.
Develop Expertise outside your Field to be an effective Manager
It was essential that business executives master at least two disciplines, and that one of them must be outside of the field of business. Expertise in more than one field was good training for sudden responsibilities in yet another field, and was the only evidence that the manager was capable of mastering more than one discipline. Mastering at least two disciplines would have a number of beneficial effects. First, the executive would have the self-confidence of knowing that he was not limited to a single field. That he could, if called upon, do something entirely different, and do it well. Moreover, “Great advances in any field rarely come from a single discipline. Rather, they come from advances in one discipline being transplanted to another sphere, which is totally unfamiliar with these procedures, ideas, or methods which have never been applied to problems in this other domain.”
· Today’s strategic leader has additional challenges. Technology enables change to take place at near light-year velocity, and with much greater penalty for failure than ever before. The penalty for the organization extends deeper than simply the loss of a leader of great promise because a leader’s actions have a much longer timeline. A tactical leader may affect what happens over a period of weeks, months, or maybe a year. But, the strategic leader’s decisions, both good and bad, reach farther and farther into the future.
Drucker’s Approach to Becoming a Strategic Leader
To become a strategic leader, you need to become proactive and take action starting now. The object is to start to think and act strategically, and to handle the increased complexity resulting from the necessity to integrate numerous elements that are, in some cases, far removed from your basic expertise and experience. This process, as Drucker taught, requires you to develop expertise outside of your current thinking. This is the main element.
READ DAILY
The first supporting element for becoming a strategic thinker is based on extensive reading outside the general area of your primary expertise. I would recommend that you develop the habit of daily reading. Of course, the big problem for most of us is to find the time to read each day. It doesn’t have to be a very long time period. Thirty minutes is sufficient. If you set aside only thirty minutes for this special type of reading and do it every day, say, first thing when you first wake up in the morning, or the last thing right before you go to sleep in the evening, that’s182.5 hours a year. Or bump it up to an hour and take the hour away from watching television. Either 182.5 or 365 hours a year is impressive. That’s a lot of reading.
If you do this already, keep it up. However, this should not only be reading general management and professional books in business outside of your specialty. Also read general-interest books in history, politics, economics, social issues, etc., and even fiction. Don’t just read words, but engage with the author actively. If you disagree with the author’s “facts” or reasoning, that is so much the better. Think it through and refute the author as if he or she were right there with you.
· Today, you not only must read extensively in your own field to reach the top and to be successful, but you also need to read extensively in other fields as well.
You Can’t Predict the Future, but You Can Create It
The future, Drucker said again, is unpredictable, but can be created. Peter emphasized that while planning, especially strategic planning, was difficult and risky, it was one of management’s primary responsibilities. “Strategic planning is not about making decisions in the future,” he said, since decisions could only be made now, in the present. So what he was really talking about was making decisions now to create a desired future for our companies. This implied reaching the goals or objectives we set, regardless of the environmental conditions we might later encounter. However, it was crucial to start with our objectives. What exactly did we want to do? Only then could we decide on the actions we needed to take now, in the present, to realize these goals.
Peter made it very clear that the process of creating your future, anybody’s future, begins with your goals and objectives. These need to be crystal-clear. Then you need to determine the actions that must be taken today to achieve these objectives in the future. Drucker said there was danger in assuming that today’s trends, whatever they are, will continue into the future. This is where things become a bit tricky. How do you start and yet forget the past?
You Must Know Your People to Lead Them
· Get Out and Talk with Those You Would Lead
Then McKinsey consultants Tom Peters and Robert Waterman found a technique in use by executives in a number of successful companies, including Hewlett-Packard, GE, PepsiCo, Lucasfilm, Corning Glass, 3M, Disney, and Wal-Mart. They popularized this technique in their best-selling book In Search of Excellence (HarperCollins, 1982) and called it MBWA, which stands for “management by wandering around. The technique is hardly new.
Two thousand years ago, Julius Caesar was popular with his soldiers because he wandered around seeing for himself what was going on and learning the names of even the most junior subordinates.
You’ve got to see those that you lead and let them see you. Management consultant Harry K. Jones developed the following ten suggestions regarding how you implement MBWA:
1. Appear relaxed as you make your rounds. Employees will reflect your feelings and actions.
2. Remain open and responsive to questions and concerns.
3. Observe and listen, and let everyone see you doing it.
4. Make certain your visits are spontaneous and unplanned.
5. Talk with employees about their passions—whether family, hobbies, vacations, or sports.
6. Ask for suggestions to improve operations, products, service, sales, etc.
7. Try to spend an equal amount of time in all areas of your organization.
8. Catch your employees doing something right and recognize them publicly.
9. Convey the image of a coach—not an inspector.
10. Encourage your employees to show you how the real work of the company gets done.
There is little question that the leader of any organization of any size has an amazing impact on that organization and the outcome of whatever activity in which it is engaged. All of us have seen organizations that were previous failures, flourish when a new leader is put in charge. The new leader may have the same resources as the previous leader, or he or she may have more or less resources. It doesn’t seem to matter. What does matter is the leader himself. If it is the right person for the right job, frequently the turnaround is almost instantaneous.
For leaders at all levels, what this means is that it is critical that you know your people, their capabilities and limitations, and how they are likely to react in any situation. The more you can do this, the better you are able to lead them. Drucker knew this, and he taught and practiced it. By getting to know the people, without whom you will accomplish nothing, you can:
ü Know what’s going on in your organization every day.
ü Help those who need help.
ü Get help from those who can supply help.
ü Discover the real problems.
ü Uncover opportunities you didn’t know existed.
ü Praise and recognize those that deserve it.
ü Correct or discipline those that need it.
ü Get your word out fast.
ü Communicate your vision for the organization.
ü Insure everyone understands your goals and objectives.
The Eight Universal Laws of Leadership
1. Integrity First. “You are entirely right and absolutely correct in listing this as your first law. A leader can be well-liked and popular and even competent, and that’s all well and good, but if he lacks integrity of character he is not fit to be a leader.”
2. Know Your Stuff. “This seems obvious, but some managers do try to cut corners rather than mastering the knowledge that they must have and that is essential to the quality of their performance.”
3. Declare Your Expectations. “I’m uncertain what you mean by this. If you mean that a leader should declare his objectives and his mission—by all means, yes.”
4. Show Uncommon Commitment. “The failure of many is because they show no commitment, or commitment to the wrong goals. This gets back to your third law. Commitment comes from a worthy mission and then strong commitment.”
5. Expect Positive Results. “There is a cautionary tale here: one must not be a ‘Pollyanna’. Still, the central thought is correct: one cannot be negative and succeed in anything.”
6. Take Care of Your People. “Many managers are failing to do this, and it will catch up with them.”
7. Put Duty Before Self. “This should be the basis of all leadership. The leader cannot act in his own interests. It must be in the interests of the customer and the worker. This is the great weakness of American management today.”
