At 95 Peter Drucker is living legend, one of the world’s most respected thinkers on management and society. His thinking has inspired many business leaders from around the world, as well as in the non-profit sector, while influencing companies both large and small.
This article – the first in series of two – is based on an interview with Drucker which recently aired on National Public Radio in the United States.
Over six decades, as journalist, teacher, consultant and author of more than 35 books, Drucker made management theory respected discipline. His lifetime of wisdom and expertise reaches well beyond the confines of the world’s largest companies.
He is the ultimate guru to generations of executives and students of management theory, of how organisations succeed and why they fail. His latest book is The Daily Drucker: 366 Days of Insight and Motivation for Getting the Right Things Done.
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 two-year study of General Motors, became an instant best-seller. Since 1971, he has taught management at Claremont Graduate University in California, which in 1987 named its school of management after him.
How does it feel to be looking at the world from 95-year-old’s vantage point?
It makes me feel very old. But not much has changed in my basic outlook. Forty years ago I used to work primarily with business. For the past 30 years I’ve worked primarily with non-profits, though I still have few old business clients. And the business people with whom I worked have mostly retired, so I’m working with new people, very interesting people. It hasn’t changed that much.
One more light question. To look out on the scene in California and have governor who shares your accent: are you surprised by Arnold Schwarzenegger’s rise?
Governor Schwarzenegger is surprise. I’ve never met him. I think he’s very able man and, by background, he’s about as different from me as anybody could possibly be. The only thing we share is the accent. He even comes from totally different part of Austria. And I left long before he was born. I left 77 years ago. So I’m not particularly impressed by another Austrian. I’ve known too many.
You have been writing, teaching and consulting about management for over 60 years. You have ranked management as among the major social innovations of the 20th century. Why? What in your view does society owe to management?
The word “management” was coined in 1911. It was unknown before then. Before that, everybody assumed that the owner ran business. Non-owners, professionals, came in shortly before World War I. Simultaneously, JP Morgan invented professional management in America, Japan and in Germany. Management was new social function, which made possible new society, society of organisations.
And let me say that while business management was the first to emerge, it was not the most important. The most important ones are the management of non-businesses, such as hospitals, universities and churches. They are the most interesting organisations because they have to define what they mean by results. How do you define the results of the large church I’m working with, which has grown from 500 to 6000 members? What are the results of Claremont Graduate University? They are much more important, much more difficult to define, and much more interesting.
Ever since the publication of your seminal book, The Practice of Management, 50 years ago you have been educating managers through book after book, dozens at this point. What’s the essential Drucker message to today’s 21st century managers?
I always ask the same three questions whether I’m dealing with business, church or university. And whether it’s American, German, or Japanese makes no difference. The first question is: what is your business? What are you trying to accomplish? What makes you distinct? The second question is: How do you define results? And that’s very tough question, much tougher in non-business than in business. The third question is: What are your core competencies? And what do they have to do with results?
That’s all really. There is no great difference between this century and the last except there are so many more organisations today. We became society of organisations in the last century. When managers were very rare you could depend on the naturals. Now you need enormous numbers of them.
You speak of management as “practice”. I wonder what you mean by that. And what’s management science? What is the difference between management as practice and management science?
I very rarely speak of management science. Management is practice like medicine. There’s medical science and there are medical scientists to support medical practice. And management, like medicine, is practice. The results are not in theory but in what actually happens. Management science supports the manager by furnishing the tools to achieve the desired results. But the implementation of those tools, the actual use of management tools, is practice not science.
So, we have all these organisations today and so many business schools charged with educating new managers and leaders. How are business schools doing in that mission?
It is mistake to say that business schools are charged with educating leaders. They are charged with educating competent mediocrities to do competent work. That’s also true of medical schools. They are not charged with educating leaders but physicians who don’t kill too many people. That’s true of law schools. They are charged with educating people who can draft decent will, not with producing legal leaders. You can’t educate leaders, well, you can in the sense that leaders need to know lot. But the purpose of professional schools is to educate competent mediocrities in large numbers. And that is what we are doing. Whether we are doing it well or not, I do not know. That’s another matter.
In an era of organisations, when society is structured by so many organisations, how can we get sufficient numbers of very competent managers, or very competent leaders?
Look, that question was answered 350 years ago with the reorganisation of the medical schools in 16th century, early 17th century, Holland and Scotland. You have to give people tool competence, you have to set standards, and you have to get across what the key questions are. So you don’t start, as the medieval medical school did, by asking the question: How do we teach medical leaders? You start by asking how do you teach ordinary people to do conscientious diagnosis. What questions must they ask? What records must they keep? What feedback do they need?
You ask pretty much the same sorts of questions in management schools. What are results, and what needs to be done, what are the priorities, and who has to understand what we are trying to do? The questions are 350 years old. They are no different in any profession. They are what distinguish profession. Pretty much everybody can learn it if he or she works hard enough.
Let me say bluntly, I don’t believe in leaders. All the talk about leaders is dangerous nonsense. It is copout. Forget about it. I am very unhappy that after the 20th century with Hitler, Stalin and Mao as the great leaders, maybe the greatest leaders in hundreds of years, I’m very unhappy that anybody wants leaders with those examples of mis-leaders so fresh. We should be very much afraid of leaders. We should ask: What do they stand for? What are their values? Can we trust them or not? Do they have charisma? We’ve had too much charisma in the past 100 years.
If you are so sceptical of high-charismatic leadership, what do you think of the recent era of high-profile CEOs we have just gone through? And, for that matter, the super-sized compensation of American exe
