From Peter Drucker - Shaping the Managerial Mind,
By John E. Flaherty, 445 pages
I grew up in a management consulting family. My father was a management consultant and three of my uncles were management consultants. My sister, brother, and a majority of cousins are management consultants. I worked for my dad and one of my uncles in their consulting firms. So the name Peter Drucker was heard early and often in world I grew up in.
Peter Drucker is recognized as the father of modern management and as the man who invented the corporate society. The book Peter Drucker – Shaping the Managerial Mind, provides the reader with an overview of his life as well as the seminal work he provided the global business world at large.
Born in Vienna, Austria in 1909, Peter F. Drucker was a man whose curiosity spanned different disciplines. In Germany, he worked as a trainee in a Hamburg trading house and became a security analyst for a bank in Hamburg, and worked as a journalist at two publications, all the while studying for his doctorate in international and public law. In 1933, he moved to England, working in business, and finally came to the United States in 1938 where he and was a professor at a number of colleges and universities and also worked as a freelance writer and business consultant. A byproduct of his consulting and writing produced a number of books, one being Concept of the Corporation (1946), his observations about General Motors when hired to perform an assessment of the company’s operations. His writings became increasingly influential over time, and finally Claremont Graduate University, where he had been teaching management for a number of years, renamed its business school the Peter F. Drucker Graduate School of Management.
Drucker’s vision paved the way for new perspectives in management. He embraced changed when the majority of U.S. businessmen preferred the status quo. His emphasis on understanding business offerings from the customer’s perspective broke with conventional wisdom, and laid foundations for modern marketing. He called his insights The Marketing Concept, which broke down into six major areas:
- Consumer sovereignty – a recognition of the customer’s perspectives and preferences in determining a product’s success in the marketplace
- Consumer rationality – an understanding of how customers assign value to a product and how they buy ‘satisfaction’ based on the ‘utility function’
- The utility function – recognizing how customers use a product and benefit from it, and what their needs may be in the future
- The distinction between sales and marketing – marketing’s mandate is to know and understand the customer so well that the product sells itself
- The systems approach – marketing should be the corporate catalyst that “integrates all comparative strengths and core competencies” to meet the challenge effectively and holistically
- The demand factor – a recognition that consumer demand evolves and changes, and that an entrepreneurial approach to integrating the past, present, and future perspectives promote a productive transition for a company future
These ideas, of course, are not new to modern marketing minds, but recognizing who was the first to establish them helps provide insight into how concepts in business can transform an entire culture with the power of their functional validity. He was also the visionary who coined the terms “knowledge society” and “knowledge worker” decades before the Information Age. Drucker also observed that every business coexists in three different time zones: traditional, transitional, and transformational. Smart managers planning for tomorrow, manage all three business time zones simultaneously. Despite the seeming age of his work, Peter Drucker’s prescient wisdom endures.
“The corporation is a social
and political system
as well as
an economic organization.”
Peter Drucker
and political system
as well as
an economic organization.”
Peter Drucker