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What would Peter Drucker have to say about the current state of business and the economy?
Management visionary Peter Drucker would have turned 100 this month. While he passed away four years ago, his visionary writings about business organizations are still well ahead of their time. And, perhaps, if managers followed his tenets more closely, their organizations wouldn't have gotten into the messes they got into over the past couple of years.
Drucker was a proponent of automation and system-driven processes, but knew that the only way to assure success as technology took over was to unleash the power and innovation of the individual. Outmoded industrial-era management had to be vanquished. Information was becoming the new commodity, and it took motivated knowledge workers to wring value out of it. Teamwork and cooperation -- not command and control -- would bring profits to the new organization.
I recall one of Drucker's ground-breaking articles that ran in Harvard Business Review in 1988 on "The Coming of the New Organization." He predicted that 20 years out (from 1988), large organizations would have far fewer traditional managers that regulated the activities of other people. Instead, work would be done by self-managed knowledge specialists brought together in task forces that cut across traditional departments.
Spot on. In today's agile organizations, we need to be constantly forming and disbanding ad-hoc teams from across our organizations and industries to get things done. Peter Drucker's writings helped drive a huge nail in the coffin of command-and-control, centralized and out-of-touch management.
What would Peter Drucker have to say about the current messy state of business and the economy? The Harvard Business Review just published a tribute to Drucker's century mark, and Rosabeth Moss Kanter, for one, observes that if Peter Drucker were here today, "his first comment might be 'I told you so' —and he would have every right to say that."
That's because in his many writings through the decades, Drucker prescribed process thinking that would have helped restore trust in business, keep attracting and motivating the best talent, and address societal problems such as climate change, health care, and public education.
Moss Kanter describes how Drucker's thinking tackles the pressing challenges affecting today's organizations:
On creative destruction: Don't let your thinking become isolated within the confines of your corporation, Drucker said. "In an 'age of discontinuity,' as Drucker called the current era, entrepreneurs could find significant opportunities to create or transform organizations if they were willing to get ahead of societal changes," Moss Kanter says. "He felt that innovators should be attuned to unmet needs that did not yet show up in market research."
On innovation: Growth and success are not the products of cost cutting and efficiency alone -- companies need that special ingredient of innovation and creativity. Moss Kanter observes that "Drucker came close to predicting the fall of General Motors, the company he had praised early in its career for its decentralized organizational structure. Years ago, he warned of troubles ahead if GM executives remained stuck in memories of previous successes.... GM was an iconic example of failure to see the need for significant innovation; its structure had become ossified, and its top management couldn’t consider a change... a company like GM could not survive simply by doing the old things with redoubled efficiency and lower costs. The company needed to dramatically rethink its entire organizational model and related assumptions."
On taking responsibility: Drucker was a passionate advocate of taking responsibility and self-management, versus heavy-handed regulation. "To restore trust in business, he would call on managers to become self-regulating rather than stand by and risk over-regulation... He would urge professionalism on the part of directors of public companies, replacing cronyism with clear, objective tools and methods for board service."
On healthcare reform: Healthcare reform can't happen in a vacuum, Drucker believed. "For improvement in health care or education he would look at entire systems, including community organizations, and he would exhort government, business, and civil society to cooperate in change," Moss Kanter says. Similarly, environmental issues require collaboration across borders and organizations, as well as out-of-the-box innovative thinking. "He would encourage innovation by social entrepreneurs who could stimulate voluntary action through not-for-profit organizations to build a base for hope and prosperity."
On managers and knowledge workers: Drucker was a tireless advocate of professionalism among managers. And, importantly, the best managers knew to stay out of the way and let employees innovate. "Knowledge workers cannot be controlled; they must be motivated. Such employees must see a purpose more meaningful than personal profit."
My ZDNet community colleague Oliver Marks also provides a great post on Drucker's perspectives on management. The world has yet to catch up with Peter Drucker.
Nov 17, 2009
Peter Drucker was a true hero. He took the business of life very seriously and changed the lives of the many people he touched through his writings and personally. But, despite his influence throughout his many decades of activity, Drucker's thoughtful, common-sense approach has made its mark on too few individuals and organizations. As with some of his academic and business contemporaries who had marginalized his perspective and efforts, there are many today who choose to ignore his brilliance. Pick up one of his books, or even a book on him (just read Class with Drucker) and get started! One of my favorite quotes, among many to do good by is, "The best way to predict the future is to create it." It is the essence of who he was and who we should strive to be.