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History of a Business Pioneer
 

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Peter Drucker: Shaping the Managerial Mind, by John E. Flaherty.
Jossey Bass, 1999, 420 pages, $27.

Peter Drucker not only created the science of management, he continues to be the dominant presence in the field. When Business Week listed the five major schools of thought that would be guiding 21st-century managers -- empowerment, learning organization, reengineering, organizational architecture, and core competencies -- it noted that all five grew directly from the concepts of Drucker. Respected British scholar and management theorist Charles Handy agrees: "Virtually everything can be traced back to Drucker," he wrote.

Given not only Drucker's importance as a pioneer but his continuing relevance today, Flaherty's Peter Drucker: Shaping the Managerial Mind should be required reading for every manager. A longtime Drucker friend and associate, Flaherty has done a superb job of laying out the evolution and context of Drucker's thinking, beginning with the 1939 publication of his first major book, The End of Economic Man.

Young Journalist

Flaherty begins by describing a gifted but restless young man in Austria who spurned the regimented learning of Vienna University to explore his diverse interests, first as a financial analyst and then as a journalist. He eventually enrolled in the law program at Frankfurt University, a program that gave him intellectual autonomy as he pursued a Ph.D. in political science (as a foreigner, he could not take the law exam). A stint at a London bank (he already saw the danger of the Nazis) preceded his emigration to the United States in 1937. He wrote for British newspapers for two years. In 1939, The End of Economic Man was published, followed three years later by The Future of Financial Man. Other writings of this period include Concept of the Corporation, Drucker's famous analysis of General Motors, and the seminal The Practice of Management.

From Society to Business

As Flaherty explores the lessons and hypotheses in these books, the notion of Peter Drucker as business writer begins to fade. Flaherty makes abundantly clear that Drucker was concerned not with business but with society -- how power is distributed in society, who the drivers of change are, and the roles and missions of the different parts of society.

The End of Economic Man, for example, explores the social deficiencies and vulnerability of all of the "isms" (capitalism, socialism, communism, and fascism). For example, Drucker preferred the freedom associated with capitalism over the centrally planned models of the other three isms. Yet, Flaherty explains, Drucker "forcefully contended that the credo of economic man, which rested on the premises of selfishness and greed, pursuit of economic salvation, and the apotheosis of materialistic expectations, was both inadequate and inappropriate as an approach to a meaningful and coherent industrial society."

His purpose was not to indict capitalism, but rather to urge large corporations to fulfill the societal responsibilities that came with their social power.

The stage was already being set for The Practice of Management, in which Drucker identified the eight objectives that all companies needed to fulfill in order to survive. One of the eight objectives was public responsibility. Profitability was another, but, Drucker stressed, it had no greater importance than the rest.

A Focus on Management

Having given the context and evolution of Drucker's thinking, Flaherty focuses on the managerial implications of this thought in such areas as managing change, leadership, communication, and decision making. Frequent bullet-point lists on specific topics such as the don'ts of innovation (among them: "Don't try to be clever. When entrepreneurs attempt to be brilliant, the odds are that they will be brilliantly wrong.") and even ethics ("the most difficult ethical problems involve not right vs. wrong, but right vs. right") reinforce the how-to (and not the "how he did") flavor of the book.

Peter Drucker: Shaping the Managerial Mind is the management counterpart to Jack Beatty's The World According to Peter Drucker, which examined Drucker's political, economic, and social ideas. Both deserve a reserved spot on your bookshelf.

Copyright © 1999 Soundview Executive Book Summaries

Last updated: Dec 1, 1999




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