Peter Drucker (1909-2005)

After Arnold Schwarzenegger, Peter Drucker, who died this week, was probably the best-known Austrian in the English-speaking world. An expert on his work explains why he has been so influential.

Writing. This was the response given by Peter F. Drucker in 1992, when asked: “To what have you dedicated your life?¨ “Since I was twenty, writing has been the foundation of everything else I have been doing”.

Over the last 60 years, the father of management and the creator of modern business theory wrote 37 books. Amongst them, oddly enough, are two novels, The Last of All Possible Worlds (1980) and The Temptation to Do Good (1984). To these, you have to add dozens of articles for both professional journals and newspapers. From 1975 to 1995, the 20-year period considered his most prolific, he was an editorial writer for the Wall Street Journal; he wrote and edited 18 books and 8 articles for the Harvard Business Review, and contributed to such publications as The Public Interest, The Atlantic Monthly, Foreign Affairs, and The Economist. The sales of his books run into the millions.

Drucker is most commonly thought of as a management theoretician, the prophet of management par excellence. Undoubtedly this is the best-known dimension of his work, but it represents only a partial view of his intellectual activity. He has shaped and moulded our understanding of management, as well as other concepts like human resources, decentralisation, efficiency, the knowledge worker, and management objectives. He anticipated important trends and discontinuities such as the characteristic features of post-modern society, the influence of technological changes on enterprise and the workplace, the leading role of innovation and entrepreneurship, the crisis of economic reductionism and the collapse of Marxist totalitarianism.

Drucker's secret
“But when people then ask: ‘What are you writing about?’, I become evasive. I have written quite a bit about economics but sure am not an economist. I have written quite a bit about history but surely am not an historian. I have written quite a bit about government and politics; but though I started out as a political scientist I long ago moved out of that field. And I am also not a sociologist as the term is now defined. I myself, however, know very well—and have known for many years—what I am trying to do. I consider myself a ‘social ecologist’ concerned with man’s man-made environment the way a natural ecologist studies the biological environment.”

More than scientific analysis, Drucker’s talent was to be able to grasp intuitively what was happening. He was a master of the art of seeing a hidden meaning in what seemed obvious to others. “My greatest strength as a consultant is to be ignorant and to ask questions,” he used to say.

Drucker’s early life
Peter Ferdinand Drucker was born in Vienna in 1909 in an cultured family which fostered both his literary vocation and his restless intellect. He combined law studies in Hamburg and Frankfurt with a job in an export company and later as a journalist with the Frankfurter General Anzeiger. His doctoral thesis in law dealt with the forms of quasi-government (quasi-Regierungen) such as revolutionary governments, governments in exile or colonies in the process of becoming independent.

His first book was a study of Friedrich Julius Stahl, a mid-nineteenth century legal philosopher and an outstanding political traditionalist and parliamentarian in Berlin and Erfurt. Stahl had been ignored by German historians of political thought, but Drucker's penchant for the innovative and creative syntheses of things otherwise deemed incompatible would seem to account for his intellectual fascination with the figure of Stahl, who could be described as the personification of paradox.

After publishing his study of Stahl, he left Germany and established himself in London, where he worked for a financial firm and attended classes given by John Maynard Keynes. In 1937, he moved to the United States to serve as a correspondent for several English and Scottish newspapers and as an assessor for various British financial institutions. Some years later, he would become a professor and consultant, activities which alternated with his work as a writer.

The father of American management
In 1941 he published The Future of Industrial Man, which predicted that we were becoming a society of organisations and that the problems of hierarchy, function and membership in these organisations, like those to which they were related in government, would be the basic issues of the second post-war period. The Future of Industrial Man was the first book which recognised what is now almost taken for granted: that the business organisation is a social organisation, a community, and at the same time, an economic enterprise. This book also paved the way for Drucker's interest in the administration of institutions and led him to undertake the study of management. It was also the book which, a few years later, would move General Motors to propose that he analyse the structure of their upper management and its policies.

A curious anecdote is appropriate here: before being called by General Motors, Drucker proposed studies on other corporations, but his offers were turned down. The president of Westinghouse thought that Drucker’s vision, which spoke of autonomy, decentralisation and responsibility, was a Viennese variety of Bolshevism.

In 1946 the powerful auto worker’s unions were fighting management, trying to regain ground lost during the war. Drucker’s thesis was not acceptable to either side: not to management, because it called for worker autonomy; nor to the unions, because it demanded from employees responsibility and initiative in carrying out their work (in other words, adopting at their level a managerial outlook). From both sides he received much the same answer: “Managers should manage and workers should work.”

However, Drucker was not discouraged and happily continued with his ruminations, whether or not they were well received. He knew what he wanted to say and said it, without fear or favour, in the coherence which was a constant feature of his life.

The art of management
After reading hundreds of pages by Drucker on the subject of business management and administration, I asked him a few years ago why none of the studies made on his work, which are comparatively more numerous than those dedicated to other outstanding contemporary authors, mention his deep anthropological and philosophical convictions. His response was that: “Because all of those who have written about me have portrayed me as an author of business management and administration, which I am not”.

In fact, Drucker, opportune et importune, pondered the great anthropological questions. His thought rose above fashions and, to a degree, the passing of time. His vital interest in and commitment to these questions was shown in a brilliant essay on Kierkegaard (The Unfashionable Kierkegaard, 1949). A paragraph of that essay could be the best end that the Peter Drucker’s fruitful life deserves: "My work has been totally in society. But I knew at once, in those far-back days of 1928, that my life would not and could not be totally in society, that it would have to have an existential dimension that transcends society... Faith is the belief that in God the impossible is possible, that in Him time and eternity are one, that both life and death are meaningful. Faith is the knowledge that man is creature— not autonomous, not the master, not the end, not the centre— and yet responsible and free. It is the acceptance of man’s essential loneliness to be overcome by the certainty that God is always with man, even ‘unto the hour of our death’.”

Guido Stein is an assistant professor of managing people in organizations at the IESE business school in Barcelona

Peter Drucker: recommended reading

Concept of the Corporation
356pp | Transaction | 1993 (1945)  | ISBN 1560006250

The Practice of Management
416 pp | Collins | 1993 (1954) | ISBN 0887306136

The Effective Executive Revised
192 pp | Collins | 2002 (1966)  | ISBN 0060516070

The New Realities
262pp | Transaction | 2003 (1989) | ISBN 0765805332