Drucker Knew Best

By John Hollon

Nov. 18, 2005

Business book publishing must be pretty profitable if you judge it by the number of new books released each month.

A lot of them cross my desk, and they all seem to be touting some new or unique insight into management. The people who write these books are well-meaning, I’m sure, but very few of their works are worth reading because, for the most part, they have very little to say.

    I have only two management books that I keep on my desk, both written by the same guy. The one I refer to the most is The Practice of Management, by Peter F. Drucker, and it is as current as any management book you’ll ever pick up–despite being written in 1954.

    Drucker, who died in California on November 11 at the age of 95, is widely considered to be the father of modern management. Generations of managers and executives have been guided by his work over the past 60 years, including, according to one obituary, Winston Churchill, Bill Gates, Jack Welch and the Japanese business establishment.

    It would be easy to simply view Drucker’s contributions through the well-known executives he influenced, but that would miss the point. His real contribution to management–workforce management–is through the critical insights, observations and guidance he provided to generations of middle managers everywhere. As The New York Times noted, “Mr. Drucker staunchly defended the need for businesses to be profitable, but he preached that employees were a resource, not a cost. His constant focus on the human impact of management decisions did not always appeal to executives, but they could not help noticing how it helped him to foresee many major trends in business and politics.”

    For example, Drucker anticipated the current debate about the relevance of human resources in a chapter in The Practice of Management titled “Is Personnel Management Bankrupt?” He noted, in 1954, that personnel administration (now HR) people persistently complain that they lack status and worry about their inability to prove that they are making a contribution to the business. And he added that the work usually performed by HR “does not produce a major function entitled to representation in top management or requiring the services of a top executive.”

    He also coined the term “knowledge worker” long before anyone really knew what knowledge work was. “Knowledge work is not defined by quantity,” Drucker wrote. “Neither is knowledge work defined by its costs. Knowledge work is defined by its results.”

    If you haven’t read Drucker, you’ll be surprised at his focus on people and how management should look for ways to give workers more control over their work and work environment. Surprisingly, how­ever, The Wall Street Journal’s obituary stated that “Mr. Drucker contributed much to the modern cult of the chief executive.” That may be true in part, but Drucker also said in 1997 that “in the next economic downturn, there will be an outbreak of bitterness and contempt for the super-corporate chieftains who pay themselves millions.”

    My favorite Peter Drucker article is one he wrote for the Harvard Business Review in 1999 titled “Managing Oneself.” In it, he proposes that success in today’s knowledge economy comes to those who know themselves, know what they are good at, and know how they best perform–especially in conjunction with those around them.

    “Organizations are no longer built on force but on trust,” he wrote. “The existence of trust between people does not mean that they like one another. It means that they understand one another. Taking responsibility for relationships is therefore an absolute necessity. It is a duty. Whether one is a member of the organization, a consultant to it, a supplier, or a distributor, one owes that responsibility to all one’s co-workers: those whose work one depends on as well as those who depend on one’s own work.”

    Peter Drucker may be gone, but he left us a lifetime of lessons. If you manage people at any level, you would do well to take heed.

Workforce Management, November 21, 2005, p. 58Subscribe Now!

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