The Essential Drucker: The Best of Sixty Years of Peter Drucker's Essential Writings on Management
by Peter F. Drucker
"When Karl Marx was beginning work on Das Kapital in the 1850s," this book begins, "the phenomenon of management was unknown" (p.3). Almost offhandedly, Drucker -- originally writing this passage in his 1988 book The New Realities -- declares Marx's work to be out of date, unable to deal with an institution -- management -- that "has transformed the social and economic fabric of the world's developed countries" (p.3; cf. p.295) and that "has become the new social function" (p.8, his emphasis). Throughout this book, which is a sort of "greatest hits" of Drucker's work from 1954-1999, this theme of management as transformative social institution is developed. And despite some level of disjointedness and a paucity of citations, probably due to the distilled nature of the text, Drucker manages to be relatively coherent and consistent throughout the book.
So what is the book about? Drucker attempts to lay out a vision of what management entails, casting it as a "liberal art" that is less concerned with profits and margins than it is with social impacts, problems, and responsibilities. The vision of management here is broad and developed over a very long career, so it's hard to summarize here, but I'll try.
First, whereas people such as Malone and Beniger claim that the information society came about due to a radical drop in the cost of disseminating information, Drucker argues that "management has been the main agent in this transformation. Management explains why, for the first time in human history, we can employ large numbers of knowledgeable, skilled people in productive work" (p.4). Management "has converted knowledge ... into the true capital of any economy" (p.5). And this enormous transformation has taken place over the last century or so:
Not many business leaders could have predicted this development back in 1870, when large enterprises were first beginning to take shape. The reason was not so much lack of foresight as lack of precedent. At that time, the only large permanent organization around was the army. Not surprisingly, therefore, its command-and-control structure became the model for the men who were putting together transcontinental railroads, steel mills, modern banks, and department stores. The command model, with a very few at the top giving orders and a great many at the bottom obeying them, remained the norm for nearly one hundred years. But it was never as static as its longevity might suggest. On the contrary, it began to change almost at once, as specialized knowledge of all sorts poured into enterprise. (p.5)As large agencies began immediately to transform themselves through the incorporation of specialized knowledge, Drucker argues, management had to coordinate this transformation, "to make people capable of joint performance, to make their strengths effective and their weaknesses irrelevant" (p.10); to establish "common goals and shared values" (p.11); to "enable the enterprise and each of its members to grow and develop as needs and opportunities change" because "every enterprise is a learning and teaching institution" and "Training and development must be built into it at all levels -- training and development that never stop" (p.11). Drucker sees management's work as social and ethical, not primarily focused on profit (p.18), but on human potential and needs. In fact, he devotes a chapter (Ch.4) to nonprofits, and another (Ch.5) on social impacts and social problems.
Drucker has been closely associated with the move to flatten organizations, and in Chapter 6, he discusses the question. He acknowledges that there is no one correct organization, just organizations with strengths and weaknesses related to specific kinds of tasks. And in terms of the supposed end of hierarchy, he terms such claims "blatant nonsense" (p.73). Rather, he says, a flatter organizational structure means that
Individuals will have to be able to work at one and the same time in different organization structures. For one task they will work in a team. But for another tasks they will have to work -- and at the same time -- in a command-and-control structure. The same person who is a "boss" within his or her own organization is a "partner" in an alliance, a minority participation, a joint venture, and so on. (pp.75-76)That is, workers are not free from hierarchy, they have to occupy different hierarchical niches in different structures simultaneously. (I sense some resonance here in Deleuze's discussion of "dividuals.") Increasingly, such workers function not as subordinates but as associates (p.78).
Let's skip ahead to Chapter 15, where Drucker traces some of the implications of workers functioning as associates. He declares:
More and more people in the workforce?and most knowledge workers?will have to manage themselves. They will have to place themselves where they can make the greatest contribution; they will have to learn to develop themselves. They will have to learn to stay young and mentally alive during a fifty-year working life. They will have to learn how and when to change what they do, how they do it and when they do it. (p.217)This means that workers have to continually educate and develop themselves. Since "knowledge workers are likely to outlive their employing organization" (p.217), they must prepare for multiple careers. Drucker has advice on this, mainly in terms of logging and analyzing one's own work patterns. But he also emphasizes education, saying that
The knowledge society must have at its core the concept of the educated person. It will have to be a universal concept, precisely because the knowledge society is a society of knowledges and because it is global - in its money, its economics, its careers, its technology, its central issues, and above all, in its information. Post-capitalist society requires a unifying force. It requires a leadership group, which can focus local, particular, separate traditions onto a common and shared commitment to values, a common concept of excellence, and on mutual respect. (p.289)Drucker calls for "a universally educated person." That doesn't mean a polymath, and "in fact, we will probably become even more specialized. But what we do need -- and what will define the educated person in the knowledge society -- is the ability to understand the various knowledges" (p.294). In the knowledge society, "the new jobs require a good deal of formal education and the ability to acquire and to apply theoretical and analytical knowledge. They require a different approach to work and a different mind-set. Above all, they require a habit of continual learning" (p.305). Whereas their predecessors could count on an end to learning and a steady career path, knowledge workers must be entrepreneurial about developing and determining their own careers, largely through self-directed learning and relearning (p.326). As specialists, they also require an organization to provide essential continuity: "It is only the organization that can convert the specialized knowledge of the knowledge worker into performance" (p.308).
Reading over the quotes I just transcribed, I'm struck by the fact that Drucker's work has become so foundational to the knowledge economy literature. Many of the assertions that Drucker makes here, particularly in terms of continual learning, seem to have been transmitted with relatively little transformation in Zuboff and Maxmin, Malone, and many others. Remarkable!
Yet I found myself wanting much more. Drucker has a real wealth of experience, but the book was thin on case studies and citations, reading more like a series of homilies than anything else. I suspect that that has to do with the fact that the book is a collection of excerpts. As a statement of principles and assumptions, then, this book is fascinating. As an argument based on evidence, it's less convincing. >
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