Peter Drucker

Peter Ferdinand Drucker (; ; November 19, 1909 – November 11, 2005) was an Austrian management consultant, educator, and author, whose writings contributed to the philosophical and practical foundations of the modern business corporation. He was also a leader in the development of management education, he invented the concept known as management by objectives and self-control, and he has been described as "the founder of modern management".
Drucker's books and articles, both scholarly and popular, explored how humans are organized across the business, government, and nonprofit sectors of society. He is one of the best-known and most widely influential thinkers and writers on the subject of management theory and practice. His writings have predicted many of the major developments of the late twentieth century, including privatization and decentralization; the rise of Japan to economic world power; the decisive importance of marketing; and the emergence of the information society with its necessity of lifelong learning. In 1959, Drucker coined the term "knowledge worker", and later in his life considered knowledge-worker productivity to be the next frontier of management.
Biography.
Drucker grew up in what he referred to as a "liberal" Lutheran Protestant household in Austria-Hungary. His mother Caroline Bondi had studied medicine and his father Adolf Drucker was a lawyer and high-level civil servant. Drucker was born in Vienna, Austria, in a small village named Kaasgraben (now part of the 19th district of Vienna-Döbling). He grew up in a home where intellectuals, high government officials, and scientists would meet to discuss new ideas. These included Joseph Schumpeter, Friedrich Hayek and Ludwig von Mises. Hans Kelsen was his uncle.
After graduating from Döbling Gymnasium in 1927, Drucker found few opportunities for employment in post-World War I Vienna, so he moved to Hamburg, Germany, first working as an apprentice at an established cotton trading company, then as a journalist, writing for "Der Österreichische Volkswirt" ("The Austrian Economist"). Drucker then moved to Frankfurt, where he took a job at the Daily "Frankfurter General-Anzeiger". While in Frankfurt, he also earned a doctorate in international law and public law from the Goethe University Frankfurt in 1931.
In 1933, Drucker left Germany for England. In London, he worked for an insurance company, then as the chief economist at a private bank. He also reconnected with Doris Schmitz, an acquaintance from the University of Frankfurt, and they married in 1934. The couple permanently relocated to the United States, where he became a university professor as well as a freelance writer and business consultant.
In 1943, Drucker became a naturalized citizen of the United States. He then had a distinguished career as a teacher, first as a professor of politics and philosophy at Bennington College from 1942 to 1949, then twenty-two years at New York University as a Professor of Management from 1950 to 1971.
Drucker went to California in 1971, where he developed one of the country's first executive MBA programs for working professionals at Claremont Graduate University (then known as Claremont Graduate School). From 1971 until his death, he was the Clarke Professor of Social Science and Management at Claremont. Claremont Graduate University's management school was named the Peter F. Drucker Graduate School of Management in his honor in 1987 (later renamed the Peter F. Drucker and Masatoshi Ito Graduate School of Management). He established the Drucker Archives at Claremont Graduate University in 1999; the Archives became the Drucker Institute in 2006. Drucker taught his last class in 2002 at age 92. He continued to act as a consultant to businesses and nonprofit organizations well into his nineties.
Drucker died November 11, 2005, in Claremont, California, of natural causes aged 95. He had four children. Drucker's wife Doris died in October 2014 at the age of 103.
Work and philosophy.
Early influences.
Among Drucker's early influences was the Austrian economist Joseph Schumpeter, a friend of his father's, who impressed upon Drucker the importance of innovation and entrepreneurship. Drucker was also influenced, in a much different way, by John Maynard Keynes, whom he heard lecture in 1934 in Cambridge. "I suddenly realized that Keynes and all the brilliant economic students in the room were interested in the behavior of commodities", Drucker wrote, "while I was interested in the behavior of people".
Over the next 70 years, Drucker's writings would be marked by a focus on relationships among human beings, as opposed to the crunching of numbers. His books were filled with lessons on how organizations can bring out the best in people, and how workers can find a sense of community and dignity in a modern society organized around large institutions. As a business consultant, Drucker disliked the term "guru", though it was often applied to him; "I have been saying for many years," Drucker once remarked, "that we are using the word 'guru' only because 'charlatan' is too long to fit into a headline."
As a young writer, Drucker wrote two pieces – one on the conservative German philosopher Friedrich Julius Stahl and another called "The Jewish Question in Germany" – that were burned and banned by the Nazis. In 1939 he published a contemporary analysis of the rise of fascism called "The End of Economic Man". This was his first book, published in New York, in English. In the introduction he refers to "The Jewish Question in Germany" saying "An early excerpt [of this book] was published as a pamphlet by an Austrian Catholic and Anti-Nazi in ... 1936".
The "business thinker".
Drucker's career as a business thinker took off in 1942, when his initial writings on politics and society won him access to the internal workings of General Motors (GM), one of the largest companies in the world at that time. His experiences in Europe had left him fascinated with the problem of authority. He shared his fascination with Donaldson Brown, the mastermind behind the administrative controls at GM. In 1943 Brown invited him in to conduct what might be called a "political audit": a two-year social-scientific analysis of the corporation. Drucker attended every board meeting, interviewed employees, and analyzed production and decision-making processes.
The resulting book, "Concept of the Corporation", popularized GM's multidivisional structure and led to numerous articles, consulting engagements, and additional books. GM, however, was hardly thrilled with the final product. Drucker had suggested that the auto giant might want to re-examine a host of long-standing policies on customer relations, dealer relations, employee relations and more. Inside the corporation, Drucker's counsel was viewed as hypercritical. GM's revered chairman, Alfred Sloan, was so upset about the book that he "simply treated it as if it did not exist," Drucker later recalled, "never mentioning it and never allowing it to be mentioned in his presence."
Drucker taught that management is "a liberal art", and he infused his management advice with interdisciplinary lessons from history, sociology, psychology, philosophy, culture and religion. He also believed strongly that all institutions, including those in the private sector, have a responsibility to the whole of society. "The fact is," Drucker wrote in his 1973 "Management: Tasks, Responsibilities, Practices", "that in modern society there is no other leadership group but managers. If the managers of our major institutions, and especially of business, do not take responsibility for the common good, no one else can or will."
Drucker was interested in the growing effect of people who worked with their minds rather than their hands . He was intrigued by employees who knew more about certain subjects than their bosses or colleagues, and yet had to cooperate with others in a large organization. Rather than simply glorify the phenomenon as the epitome of human progress, Drucker analyzed it, and explained how it challenged the common thinking about how organizations should be run.
His approach worked well in the increasingly mature business world of the second half of the twentieth century. By that time large corporations had developed the basic manufacturing efficiencies and managerial hierarchies of mass production. Executives thought they knew how to run companies, and Drucker took it upon himself to poke holes in their beliefs, lest organizations become stale. But he did so in a sympathetic way. He assumed that his readers were intelligent, rational, hardworking people of good will . If their organizations struggled, he believed it was usually because of outdated ideas, a narrow conception of problems, or internal misunderstandings.
Drucker developed an extensive consulting business built around his personal relationship with top management. He became legendary among many of post-war Japan's new business leaders trying to rebuild their war-torn homeland. He advised the heads of General Motors, Sears, General Electric, W.R. Grace and IBM, among many others. Over time he offered his management advice to nonprofits like the American Red Cross and the Salvation Army. His advice was eagerly sought by the senior executives of the Adela Investment Company, a private initiative of the world's multinational corporations to promote investment in the developing countries of Latin America.
Writings.
Drucker's 39 books have been translated into more than thirty-six languages. Two are novels, one an autobiography. He is the co-author of a book on Japanese painting, and made eight series of educational films on management topics. He also penned a regular column in the "Wall Street Journal" for 10 years and contributed frequently to the "Harvard Business Review", "The Atlantic Monthly", and "The Economist".
His work is especially popular in Japan, even more so after the publication of "What If the Female Manager of a High-School Baseball Team Read Drucker's "Management"", a novel that features the main character using one of his books to great effect, which was also adapted into an anime and a live action film. His popularity in Japan may be compared with that of his contemporary W. Edwards Deming.
Criticism.
"The Wall Street Journal" researched several of his lectures in 1987 and reported that he was sometimes loose with the facts. Drucker was off the mark, for example, when he told an audience that the English language was the official language for all employees at Japan's Mitsui trading company. Drucker defended himself: "I use anecdotes to make a point, not to write history."
Also, while Drucker was known for his prescience, he was not always correct in his forecasts. He predicted, for instance, that the United States' financial center would shift from New York to Washington.
Others maintain that one of Drucker's core concepts," management by objectives," is flawed and has never really been proven to work effectively. Critic Dale Krueger said that the system is difficult to implement and that companies often wind up overemphasizing control, as opposed to fostering creativity, to meet their goals.
Drucker's classic work, "Concept of the Corporation", criticized General Motors while it was considered the most successful corporation in the world. Many of GM's executives considered Drucker persona non grata for a long time afterward. Although Alfred P. Sloan refrained from personal hostility toward Drucker, he considered Drucker's critiques of GM's management to be "dead wrong".
Awards and honors.
Drucker was awarded the Presidential Medal of Freedom by US President George W. Bush on July 9, 2002. He also received honors from the governments of Austria, including the Grand Silver Medal for Services to the Republic of Austria in 1974, the Grand Gold Decoration for Services to the Republic of Austria in 1991 and the Austrian Cross of Honour for Science and Art, 1st class in 1999 and Japan (Order of the Sacred Treasure, 3rd class; 24 June 1966).
Drucker was the Honorary Chairman of the "Peter F. Drucker Foundation for Nonprofit Management", now the "Leader to Leader Institute", from 1990 through 2002. In 1969 he was awarded New York University's highest honor, its Presidential Citation. For his article, "What Makes an Effective Executive", "Harvard Business Review" honored Drucker in the June 2004 with his seventh McKinsey Award – the most awarded to one person. Drucker was inducted into the Junior Achievement US Business Hall of Fame in 1996. He received 25 honorary doctorates from American, Belgian, Czech, English, Spanish and Swiss universities. His 1954 book "The Practice of Management" was voted the third most influential management book of the 20th century in a poll of the Fellows of the Academy of Management. In Claremont, California, Eleventh Street between College Avenue and Dartmouth Avenue was renamed "Drucker Way" in October 2009 to commemorate the 100th anniversary of Drucker's birth.
Drucker was posthumously honored when he was inducted into the Outsourcing Hall of Fame in recognition of his outstanding contributions in the field. In 2018, Drucker was named the world's most influential business thinker on the Thinkers50.com list.
Legacy.
At Claremont Graduate University, the Peter F. Drucker Graduate Management Center – now the Peter F. Drucker and Masatoshi Ito Graduate School of Management – was established in 1987 and continues to be guided by Drucker's principles.
The annual Global Peter Drucker Forum was first held in 2009, the centenary of Drucker's birth.