Peter Drucker's Monumental Legacy
By Mark Morrison
Peter Drucker's death on Friday, Nov. 11 ended a remarkable 70-year career as thinker, visionary, author, consultant, and professor. Drucker defined many of the modern management principles taken for granted in today's corporations. Decades ago he was pushing the concepts of customer-focus, employee empowerment, and innovation that are bullet points in every CEO's playbook today (see BW Online, 9/8/04, "Peter Drucker: Mr. Management").
One of Drucker's many strong points as a leader of management thinking was his consistent view that people are the most important resource a company has. The main function of effective managers, therefore, is to train and motivate workers and give them great freedom to perform their jobs.
He often described himself as a writer, and his books go all the way back to 1939 when he wrote The End of the Economic Man, a political and sociological work that won praise from Winston Churchill. As recently as the 1990s, he wrote Managing in a Time of Great Change, Management Challenges for the 21st Century, and Managing for the Future: The 1990s and Beyond. His final book, The Effective Executive In Action, is expected to be published by Harper Collins next year.
"THE MOST ENDURING."
Drucker was often the first to discern a major trend such as the rise of Japan as an industrial and economic force or the high impact of technology on management practices. For a pro-business, conservative guru, he was eclectic in his views -- condemning excessive executive pay, for example, while emphasizing the positive side of outsourcing (that it's not about saving money but boosting quality) and seeing a constructive role for labor unions.
As BusinessWeek Executive Editor John Byrne wrote in a 2002 analysis (see "The Man Who Redefined Management"), "Smart ideas, clever insight, and pragmatic philosophy distinguish Drucker as the most enduring and influential management guru in history."
Drucker was also a bit of a dreamer, envisioning corporations as communities where people and organizations strive for noneconomic satisfaction. Since the 1970s, however, those ideas have been losing ground. There has been an enormous decline in values such as corporate loyalty and lifetime employment at the same time that executive pay has become, in Drucker's view, excessive, and as a number of big corporations such as Enron lost their moral compass. In his last days, he saw General Motors (GM ) -- the company whose management he studied and admired in the 1940s -- in crisis mode trying to unwind many of the obligations to workers and retirees that it can no longer afford to meet.
Drucker's idealism had developed in part from his groundbreaking research of GM that led to one of his best-known of 39 books, Concept of the Corporation. "When Peter goes into GM in 1943, there was this enormous solidarity," author Ken Witty, who produced a 2002 documentary about Drucker, told BusinessWeek Online at the time (see "Peter Drucker's Search for Community"). Drucker witnessed workers, including many women, making tanks and Jeeps for the war effort. "Peter sees this great communal spirit" that reinforced his view that the worker is a resource, not a cost, says Witty.
While known for nudging companies to be more efficient and innovative, Drucker remained, in Witty's view, a "European social communitarian like one of the Christian Democratic politicians" -- reflecting in part that his family was uprooted during World War I and that he was educated in his native Austria, and in Britain and Germany.
Since 1971, Drucker taught at the management school named for him at California's Claremont Graduate University. He also continued to churn out popular management articles, many for the Harvard Business Review and The Wall Street Journal, and more books. But his passion in recent years was increasingly to work with nonprofit institutions such as the Girl Scouts and American Red Cross. These institutions, Drucker found, could benefit from sound management and also deliver on his vision of functioning as communities.
Morrison is a national correspondent for BusinessWeek in Austin and is a former managing editor of the magazine